The Delhi High Court has overturned two district court possession decrees, clarifying that an unregistered Agreement to Sell cannot be used as a basis for a decree under Order XII Rule 6 of the CPC, nor does it attract protection under Section 53A of the Transfer of Property Act. The judgment refines the doctrine of part performance and stresses the need for clear, unequivocal admissions before invoking discretionary relief.
Background & Facts
The Dispute
The plaintiff, Raj Rani Uppal, initiated two separate civil suits seeking possession of different portions of a property at No.36/7, East Punjabi Bagh, New Delhi. The first suit (CS No.328/2021) targeted the Upper Ground Floor occupied by Rahul Chaudhary; the second suit (CS No.460/2021) targeted the Third Floor occupied by Kamal Kant Sharma and Ritesh Kumar. Both suits alleged arrears of rent, mesne profits and sought permanent injunctions.
Key Facts
- 31.08.2016: Rent Agreement executed between Raj Rani Uppal (landlord) and Rahul Chaudhary (tenant) for the Upper Ground Floor at Rs 32,000 per month, commencing 10.09.2016.
- 16.11.2016: Notarised Agreement to Sell executed between the plaintiff and the defendants (Rahul Chaudhary and Kamal Kant Sharma) for the Upper Ground Floor and Third Floor, total consideration Rs 1,50,00,000. The agreement expressly cancelled the earlier rent agreement.
- 02.11.2016: Token money of Rs 7,50,000 paid in cash to the plaintiff.
- 10.01.2019: Receipt-cum-Possession Letter handed over vacant possession of the Third Floor to the defendants.
- 08.02.2017 & 13.02.2017: Advance rent deposits of Rs 5,00,000 and Rs 2,50,000 made by Rahul Chaudhary.
- 06.09.2019: Rahul Chaudhary transferred Rs 1,50,000 for rent (Sept-Dec 2019).
- 06.12.2019: Fresh Rent Agreement executed for the Upper Ground Floor at Rs 37,000 per month, later increased to Rs 40,700.
- 12.12.2019: Cash payment of Rs 1,00,000 to the plaintiff’s son for Jan-Feb 2020 rent.
- Various dates 2019-2021: Multiple payments made by Kamal Kant Sharma and Rahul Chaudhary towards the sale consideration, totalling Rs 43,20,000.
- 01.03.2021: Legal notice terminating Rahul Chaudhary’s tenancy and demanding arrears of Rs 4,67,800 with 24% interest.
- 24.03.2021: Legal notice terminating the tenancy of Kamal Kant Sharma and Ritesh Kumar, demanding arrears of Rs 2,52,900 and rent for April 2021.
- 09.10.2024: District Judge decreed possession against Rahul Chaudhary under Order XII Rule 6 CPC.
- 15.10.2024: District Judge decreed possession against Kamal Kant Sharma and Ritesh Kumar under Order XII Rule 6 CPC.
Procedural History
- 28.03.2023: Regular First Appeals (RFA 104/2025 & RFA 222/2025) filed before the Delhi High Court under Section 96 CPC against the two district court judgments.
- 31.08.2026: Judgment delivered by Hon'ble Ms. Justice Neena Bansal Krishna.
The Parties' Positions
- Appellants (Rahul Chaudhary & Kamal Kant Sharma): Assert that the Agreement to Sell, though unregistered, constitutes part performance under Section 53A TPA and that the tenancy was terminated by express clause in the agreement. They seek reversal of the possession decrees.
- Respondent (Raj Rani Uppal): Argues that the Agreement to Sell is unregistered, therefore ineffective for possession protection; the tenancy continued until proper notice; the district court correctly exercised discretion under Order XII Rule 6 CPC.
Relief Sought
- Appellants: Set aside the possession decrees dated 09.10.2024 and 15.10.2024; remand the matters for trial on merits; direct parties to appear before the District Judge on 17.09.2026.
- Respondent: Maintain the decrees and possession orders.
The Legal Issue
The central question was whether an unregistered Agreement to Sell can (i) constitute a clear, unequivocal admission of tenancy such that a decree of possession may be passed under Order XII Rule 6 CPC, and (ii) attract protection of possession under Section 53A of the Transfer of Property Act despite its lack of registration.
Arguments Presented
For the Appellant(s)
- The Agreement to Sell expressly cancelled the earlier rent agreement, thereby terminating the tenancy; the defendants’ continued possession is that of prospective purchasers, invoking part performance under Section 53A TPA.
- Substantial payments of Rs 43,20,000 demonstrate that the parties acted on the agreement, satisfying the test of part performance.
- Reliance on Union of India v. M/s K.C. Sharma & Co. and R. Kanthimathi v. Beatrice Xavier to argue that possession can be protected even without registration when the transferee is in actual possession and has acted on the contract.
For the Respondent
- Section 17(1A) of the Registration Act, 1908 mandates registration of any document dealing with immovable property; an unregistered agreement cannot confer any right to possession under Section 53A TPA.
- The district judge correctly applied the discretionary nature of Order XII Rule 6 CPC; there was no clear, unconditional admission that the defendants remained tenants after the Agreement to Sell.
- Citing S.M. Asif v. Virendra Kumar Bajaj and Karan Kapoor v. Madhuri Kumar that admissions must be unequivocal before a decree can be passed under Order XII Rule 6 CPC.
The Court's Analysis
The Court began by examining the statutory framework. Section 53A TPA protects a person who has taken possession of immovable property in part performance of a contract of sale, provided the contract is registered or, if unregistered, the document falls within the exception under Section 17(1A) Registration Act. The Court noted that the Registration Act expressly requires registration of any instrument affecting immovable property where the law mandates it, and an unregistered instrument “shall have no effect” for purposes of Section 53A.
"The learned District Judge rightly held that the Appellants are not entitled to the protection under Section 53A TPA."
The Court then turned to the doctrine of part performance. It reiterated that part performance does not create a title; it merely allows the contract to be admitted as evidence in a suit for specific performance. The Court emphasized that the protection under Section 53A is not a blanket right conferred by part performance; registration remains a prerequisite unless the statute expressly relaxes the requirement, which it does not.
Next, the Court scrutinised the admissions under Order XII Rule 6 CPC. It quoted S.M. Asif that the power to pass judgment on admissions is discretionary and cannot be invoked where the admission is not “clear, unequivocal and unconditional”. The written statements of the defendants admitted initial tenancy but simultaneously pleaded that the tenancy was terminated by the Agreement to Sell. This dual pleading, the Court held, negated any unequivocal admission of continued tenancy.
The Court also examined the factual matrix surrounding the Agreement to Sell. While the agreement contained a clause cancelling the rent agreement, the Court observed that the parties’ conduct - particularly the filing of a separate suit for specific performance (CS DJ No. 929/2024) - indicated that the dispute over possession and title remained unresolved. Hence, the possession could not be protected under Section 53A pending adjudication of the specific performance suit.
Distinguishing Union of India v. M/s K.C. Sharma (where the Supreme Court dealt with a registered sale), the Court held that the present case involved an unregistered instrument, making the reliance on that precedent untenable. The Court further relied on Vayyaeti Srinivasarao v. Gaineedi Jagajyothi to underscore that an express or implied surrender of tenancy must be evident from the conduct of the parties; here, the conduct was mixed and did not conclusively demonstrate surrender.
Finally, the Court concluded that the district judge erred in (i) treating the unregistered Agreement to Sell as a basis for possession under Section 53A, and (ii) treating the defendants’ pleadings as a clear admission for the purpose of Order XII Rule 6 CPC. Accordingly, the decrees were set aside and the matters remanded for a full trial on merits.
The Verdict
The Court set aside the possession decrees dated 09.10.2024 and 15.10.2024, held that the unregistered Agreement to Sell cannot confer protection of possession under Section 53A TPA, and that the defendants’ pleadings did not amount to a clear, unequivocal admission required for a decree under Order XII Rule 6 CPC. The matters were remanded to the learned District Judge, West District, Tis Hazari, Delhi, with a direction to hear the suits on merits and to appear on 17 September 2026.
What This Means For Similar Cases
Unregistered Sale Agreements Do Not Confer Possession Rights
Practitioners must ensure that any agreement intended to affect title to immovable property is duly registered. Reliance on an unregistered instrument for possession claims under Section 53A TPA is untenable.
- Register all sale agreements where the property is to be transferred.
- If registration is pending, advise clients that possession cannot be protected under Section 53A.
Admissions Must Be Clear and Unconditional for Order XII Rule 6 CPC
A mixed pleading - admitting tenancy while simultaneously asserting termination - fails the test of unequivocal admission. Courts will refuse to invoke the discretionary power under Order XII Rule 6 CPC.
- Draft pleadings to avoid contradictory statements.
- When a defence hinges on an agreement to sell, ensure the agreement’s terms and the parties’ conduct unmistakably demonstrate surrender of tenancy.
Separate Suit for Specific Performance Remains Essential
When title and possession are contested, a suit for specific performance should proceed independently; it cannot be merged into a possession decree under Order XII Rule 6 CPC.
- File a distinct specific performance suit.
- Do not rely on part performance to secure possession before the substantive title dispute is resolved.
