#agreement to sell

The Delhi High Court held that forfeiture of earnest money under an Agreement to Sell is not automatic; the party retaining the deposit must prove actual legal injury and quantifiable loss under Section 74 of the Indian Contract Act. The court distinguished the K.R. Suresh precedent, ruling it inapplicable to simple recovery suits, thereby strengthening a vendee's right to recover earnest money absent proven damages.

The Delhi High Court overturned two district-court possession orders, ruling that an unregistered agreement to sell cannot be invoked to obtain possession under Order XII Rule 6 CPC and does not attract the protection of Section 53A of the Transfer of Property Act. This limits claimants from using informal sale agreements to secure possession of property.

An agreement to sell a premises and receipt of part-payment cannot by themselves terminate an existing lease; only a surrender under Section 111 of the Transfer of Property Act ends tenancy. This clarifies that landlords must obtain a formal surrender before evicting tenants, protecting occupants in similar sale-related disputes.

The Karnataka High Court holds that a buyer under an agreement to sell cannot implead as a party in a partition suit involving the vendor’s property unless they first obtain a decree for specific performance. This clarifies that equitable rights under contract are not sufficient to intervene in ownership disputes - only a judicially enforced title grants standing, protecting co-owners from speculative claims.

ITAT Pune rules that substantial payment and possession transfer under an agreement to sell qualifies for Section 54F exemption, even if the sale deed is registered years later. This clarifies that formal registration delay does not invalidate the exemption claim, offering relief to taxpayers in similar transactions.

The Himachal Pradesh High Court ruled that a non-agriculturist in actual, continuous possession under a pre-1995 agreement to sell cannot be dispossessed by self-help, and the original owner cannot seek injunction merely on grounds of transferee status. This affirms equitable possession as a shield against eviction, even where statutory restrictions on land transfer exist.

Allahabad HC rules that a transferee’s possessory title under Section 53A of the Transfer of Property Act remains enforceable even after the agreement’s expiry, provided possession is undisturbed and full consideration is paid. The ruling shields transferees from eviction or interference by the transferor or third parties, reinforcing equitable protection for part-performance.

Punjab & Haryana High Court rules that Section 34 CPC overrides contractual interest rates in non-commercial agreements, limiting future interest to 6% per annum even if parties agreed to higher rates. The judgment reinforces statutory protections in private residential transactions, impacting sellers defaulting on sale agreements.

The Punjab & Haryana High Court ruled that proving an agreement to sell alone is insufficient for specific performance; the plaintiff must demonstrate continuous readiness and willingness to perform. Five years of inaction after title perfection defeats equitable relief, reinforcing that specific performance is not an automatic remedy but a discretionary equitable relief requiring active compliance.

Punjab & Haryana HC rules that once a defendant admits their signature on a post-dated stamp paper agreement, the burden shifts to them to prove forgery with cogent evidence. The court dismissed the appeal, holding that prior access to blank papers does not automatically invalidate the agreement, reinforcing the presumption of valid execution under contract law.

The Punjab & Haryana High Court has ruled that in suits seeking declaration of ownership after forfeiture of earnest money under an agreement to sell, the court fee must be calculated only on the earnest money amount, not the full sale consideration, if possession has not been transferred. This clarifies a critical cost threshold for property litigants and prevents disproportionate fee burdens in cases where no transfer of title or possession has occurred.

The Punjab & Haryana High Court ruled that a defendant's admission in a prior Negotiable Instruments Act case conclusively proves the existence of an Agreement to Sell, relieving the plaintiff of the burden to prove readiness and willingness in detail when execution is denied. This streamlines specific performance claims by leveraging admissions from related proceedings.

Punjab & Haryana HC reinforces that plaintiffs seeking specific performance must prove continuous readiness and willingness throughout the litigation. In a landmark ruling, the court awarded 12% interest on the balance consideration to balance equity after a 38-year delay in enforcing a 1988 land sale agreement, setting a precedent for equitable relief in long-pending property disputes.

Punjab & Haryana High Court reiterates that mere breach of an agreement to sell, without proof of dishonest intent at the time of contract execution, remains a civil dispute. Criminal proceedings under Sections 420, 467, 468, and 471 IPC cannot be invoked to pressure parties in civil disputes, reinforcing the bar on criminalizing civil wrongs absent fraudulent mens rea.

Bombay High Court holds that mere agreement to sell agricultural land does not violate Section 43 of the Bombay Tenancy Act; forfeiture unjustified without completed transfer.