The Bombay High Court has delivered a definitive ruling clarifying the limited scope of Section 6 of the Specific Relief Act, 1963, holding that developers cannot invoke this summary remedy to recover possession of flats from purchasers over disputes concerning unpaid consideration. This judgment reasserts the principle that Section 6 is not a tool for resolving contractual breaches or title disputes, but a narrow procedural safeguard against unlawful dispossession.
Background & Facts
The Dispute
The dispute arose between Jayashree Jaisingh Babar, a flat purchaser, and Shirish Ramdas Sarode, a real estate developer, over possession of Flat No. 4 in Manasi Apartment, Pune. The parties executed a registered Agreement for Sale on 25 August 2004 for a total consideration of Rs. 3,55,000, excluding additional charges. The developer claimed the purchaser failed to pay Rs. 36,000 for additional work and Rs. 10,000 for electricity connection, and terminated the agreement on 8 January 2007. The purchaser, however, asserted she had paid Rs. 4,23,000 and took possession in February 2005.
Procedural History
- 2004: Registered Agreement for Sale executed between developer and purchaser.
- 2006: Purchaser filed a complaint before the District Consumer Redressal Forum seeking possession; the Forum granted refund of Rs. 3,43,643 with interest but denied possession.
- 2009: Developer lodged a police complaint alleging illegal occupation and filed a civil suit under Section 6 of the Specific Relief Act.
- 2012: The suit was renumbered as Regular Civil Suit No. 1261 of 2012.
- 2022: The Trial Court decreed the suit, ordering the purchaser to restore possession and pay Rs. 84,000 per annum as compensation.
- 2022: Purchaser filed Civil Revision Application under Section 115 of the Code of Civil Procedure.
Relief Sought
The developer sought restoration of possession, injunction against creation of third-party rights, compensation for illegal occupation, and mesne profits. The purchaser challenged the maintainability of the suit under Section 6, arguing it involved complex contractual disputes beyond the scope of summary remedy.
The Legal Issue
The central question was whether a developer can invoke Section 6 of the Specific Relief Act to recover possession of a flat from a purchaser on the ground of non-payment of consideration, and whether such a suit can include claims for injunction and compensation.
Arguments Presented
For the Appellant/Petitioner
Mr. Deepak M. Gupte argued that Section 6 is a summary remedy meant only to restore possession after unlawful dispossession, without adjudicating title or contractual obligations. He contended that the developer was never in settled possession of the flat, as he was merely a constructor holding the property on behalf of landowners. The suit’s inclusion of claims for injunction and compensation rendered it non-maintainable under Section 6. He relied on Hawabai Wd/o Suleman Haji Ahmed Oomar v. Abdul Sattar Suleman Haji Ahmed Oomar to argue that Section 6 cannot be used to resolve disputes arising from incomplete sale transactions.
For the Respondent/State
Mr. Girish Agrawal contended that the purchaser’s forcible occupation of the flat after termination of the Agreement for Sale constituted illegal dispossession. He argued that the Trial Court’s findings on possession were factual and beyond revisionary interference. He relied on Miraj Medical Centre v. Sunil Tukaram Danane and Kesoram Industries Ltd. v. Allahabad Bank to assert that findings of the Consumer Forum could be considered, and that compensation was ancillary to the main prayer for possession.
The Court's Analysis
The Court undertook a rigorous doctrinal analysis of Section 6 of the Specific Relief Act, emphasizing its summary and exceptional nature. It held that the remedy is confined to three narrow inquiries: (i) whether the plaintiff was in possession before dispossession; (ii) whether dispossession occurred within six months; and (iii) whether it was without consent and without due process of law. The Court explicitly rejected the notion that Section 6 can be used to resolve disputes over payment of consideration, termination of agreements, or claims for damages.
"The moment additional relief is sought in the suit, the same would travel beyond the ambit of Section 6 of the Specific Relief Act."
The Court observed that the plaint included prayers for injunction against third-party rights, compensation for mental agony, loss of goodwill, and mesne profits - all of which required adjudication of title, contractual validity, and damages. These issues are inherently substantive and cannot be resolved in a summary proceeding. The Trial Court’s detailed examination of payment records, cheque encashment, and termination notices further confirmed that the suit had transcended the boundaries of Section 6.
The Court also examined the concept of "settled possession" under Section 6, citing Ashapura Options Pvt. Ltd. v. Ashapura Developers and ITC Ltd. v. Adarsh Coop. Housing Society Ltd. It held that a developer, who constructs a flat on behalf of landowners and holds it pending sale, cannot be said to be in "settled possession" of the unit. The purchaser’s occupation, even if disputed, was not mere trespass but a claim under a contractual right. The Court emphasized that animus possidendi - the intention to possess as one’s own - is essential for Section 6 protection, and a developer lacks this when holding property for sale.
The Court further clarified that the Consumer Forum’s earlier order denying possession did not trigger res judicata, as the suit itself was jurisdictionally flawed. The remedy for the developer lay in a substantive suit for recovery of possession based on title, not a summary proceeding.
The Verdict
The petitioner won. The Bombay High Court held that Section 6 of the Specific Relief Act cannot be invoked by a developer to recover possession of a flat from a purchaser over disputes concerning non-payment of consideration. The impugned decree was set aside, and the suit was dismissed for being non-maintainable. The developer retains the right to file a substantive suit for recovery of possession based on title.
What This Means For Similar Cases
Summary Remedies Cannot Substitute Substantive Suits
- Practitioners must avoid filing suits under Section 6 of the Specific Relief Act where the dispute involves contractual breaches, non-payment, or termination of sale agreements.
- Developers must file regular suits under Section 9 of the Code of Civil Procedure for recovery of possession based on title, not summary remedies.
- Courts must dismiss Section 6 suits at the threshold if pleadings include claims beyond restoration of possession.
Developer’s Possession Is Not "Settled" Under Section 6
- A developer holding a flat pending sale does not acquire "settled possession" under Section 6, even if the flat is completed and occupied.
- Occupation by a purchaser under a registered agreement, even if disputed, cannot be treated as illegal dispossession under Section 6.
- Courts must apply the animus possidendi test strictly: possession must be as an owner, not as a custodian or agent.
Compensation and Injunction Are Jurisdictionally Barred
- Claims for compensation, mesne profits, or injunction against third-party transfers cannot be adjudicated in a Section 6 suit.
- If such claims are included, the entire suit becomes non-maintainable and must be dismissed, not severed.
- Practitioners should draft pleadings with precision: Section 6 suits must contain only allegations of dispossession, date, and lack of consent.
