Introduction

Doctrine of Part Performance is an equitable doctrine and it is incorporated to

prevent fraud and from taking illegal advantage on account of non-registration
of the document. This Doctrine is based on the maxim, Equity look at as it is
done which ought to have been done.

Basically the doctrine says that the transferor or any person claiming under him
shall be debarred from enforcing against the transferee and the person claiming
under him any right in respect of the property of which the transferee has taken
or continued in possession, other than a right expressly provided by the term of
the contract.

Definition
The doctrine of part performance is enshrined in the provisions of The Transfer
of Property Act, 1882.
Section 53-A of the Act, deals with definition of the doctrine and it says:

When any person contracts to transfer for consideration any immovable

property by writing signed by him or on his behalf from which the terms
necessary to constitute the transfer can be ascertained with reasonable certainty,
and the transferee has, in part performance of the contract, taken possession of
the property or any part thereof, or the transferee, being already in possession,
continues in possession in part performance of the contract and has done some
act in furtherance of the contract, and the transferee has performed or is willing
to perform his part of the contract, then, notwithstanding that where there is an
instrument of transfer, that the transfer has not been completed in the manner
prescribed therefore by the law time being in force, the transferor or any person
claiming under him shall be debarred from enforcing against the transferee and
persons claiming under him any right in respect of the property of which the
transferee has taken or continued in possession, other than a right expressly
provided by the terms of the contract:
Provided that nothing in this section shall affect the rights of a transferee for
consideration who has no notice of the contract or of the part performance
thereof.

Illustration:
A contract to transfer his immovable property to B by way of sale and put B in
possession of the property before a regular Sale-Deed is executed. The contract
is said to be partly performed and if later on A refuses to execute regular
document of sale and files a suit for eviction against B treating B as trespasser.
Then B can resist A’s claim on the ground that the contract of transfer in his
favour has partly been performed and that A should not be allowed to go back
upon his own word.

Ingredients of Section 53-A

Bombay High Court in Kamalabai Laxman Pathak v. Onkar Parsharam Patil[1],

has given emphasis on the ingredients of the Section 53-A which are as follows:

Contract for Transfer of immovable property:

For the application of this section, the first condition is that there must be a
contract and the contract must be transfer of immovable property for value.
a) Written contract:
The contract must be written. Section 53 –A is not applicable if the contract for
transfer is oral. In V.R. Sudhakara Rao v. T.V. Kameswari[2], it was held that
the benefit of section 53-A is not available to a person who is in possession of
property based on oral agreement of sale. Writing alone is not sufficient. The
contract must also be duly executed. That is to say, it should be signed by the
transferor or by any other person on his behalf.

b) Valid Contract:
It may be noted that Section 53-A is applicable only where contract for the
transfer is valid in all respects. It must be an agreement enforceable by law
under the Indian Contract Act, 1872.

c) Immovable property:
This section is applicable only in case of transfer of immovable property. It does
not apply to an agreement for the transfer of movable property even though
supported with consideration. The defence of Part Performance is not available
in respect of possession of movables (Hameed v. Jayabharat Credit &
Investment Co. Ltd and Ors.[3])
 

Transfer for consideration:

The written contract must be for the transfer of an immovable property for
consideration. The written contract on the basis of which the property has been
possessed, must clearly suggest the transfer of property. If the document is
ambiguous or confusing, this section cannot be made applicable. It is one of the
necessary ingredients of section 53-A that the terms of written contract must be
ascertainable with reasonable certainty (Hamida v. Humer and Ors.[4]).
 

Possession in furtherance of Contract:

The Transferee has taken possession or continues possession in part

performance of the contract or, has done some act in furtherance of the contract
(A.M.A Sultan (deceased by LRs) and Ors. v. Seydu Zohra Beevi[5]).
 
Some Act in furtherance of the contract:

Taking possession is not only the method of part performance of contract. If the
transferee is already in possession of the property then, after the contract of
transfer, he has to do some further act in part performance of the contract
(Nathulal v. Phoolchand[6]).
 

Transferee is willing to perform his part of contract:

Section 53-A is based on the principle of Equity. Equity says that one who seeks
equity must do equity. Therefore, where a person claims protection of his
possession over a land under section 53-A, his own conduct must be equitable
and just. It is an essential condition for the applicability of this section that the
transferee must be willing to perform his part of contract (Sardar Govindrao
Mahadik and Anr. vs. Devi Sahai and Ors Govind[7])

Scope of Doctrine of Part Performance

The Doctrine of Part Performance is applicable to only written and valid

contract. It is not applicable to oral or void agreement. The contract must be in
writing and signed by the transferor. The transferee has taken possession of the
property as a part performance of a contract and transferee must be ready and
willing to perform his part of promise. This section is applicable not only to the
contract of sale but it is applicable to all such contracts of transfer for
consideration. It has been held in (Jacobs Private Limited vs. Thomas Jacob [8])
that the doctrine is intended to be used as a shield, not a sword.

Amendments to Section 53-A of Transfer of Property Act, 1882 (hereinafter

called as T.P. Act)

An amendment has been made in Section 53-A of Transfer of Property Act by

the Registration and other related laws and Act (48 of 2001). This Amending
Act (48 of 2001) has made following changes in section 53-A:

Section Amendment

Sub Section 1 A of Registration Act inserted:

The documents containing contract to transfer for consideration, any
immovable property for the purpose of Section 53-A of Transfer of
Section Property Act, 1882 (4 of 1882) shall be registered if they have been
17 executed on or after the commencement of the Registration and other
Related Laws (Amendment) Act, 2001 and if such documents are not
registered on or after such commencement then, they shall have no
effect for the purposes of the said section 53-A

Section 49 of Registration Act, in the proviso; words, figures and

Section
letters as evidence of part performance of a contract for the purposes
49
of Section 53-A of T.P. Act, 1882 (4 OF 1882), shall be Omitted.

Section
In Section 53-A, para no. 4 of T.P. Act, the words the contract, though
53-A para
required to be registered, has not been registered, or, Omitted.
4

The provisions of this Amending Act (Act of 48 of 2001) came into force with
effect from 24-September-2001. This Amendment Act is not retrospective.

Legal Effect of the Amending Act (48 of 2001) in Section 53-A:

In para fourth of Section 53-A of T.P. Act, the words the contract, though
required to be registered, has not been registered has now been omitted. This
may mean to suggest that non registration of any contract to transfer for
consideration is not any relevant factor (i.e. not necessary) for the application of
part performance under this section; and, the defence of part performance is
available also on the basis of an unregistered document.

But this is not the case. The same Amending Act (48 of 2001) has
simultaneously amended section 17 and Section 49 of Registration Act.
Therefore, the amendment in section 53-A should be read with amendments in
section 17 and section 49 of Registration Act.  the amendments of section 17
and section 49 of Registration Act has now incorporated the law which fulfills
the real purpose of amending Section 53-A of the T.P. Act. The object or the real
purpose of these amendments (Amending Act 48 of 2001) is that there should
not be any perpetual possession of an immovable evading the law of
registration. Accordingly, section 53-A of the T.P. Act now insists upon proof of
some acts having being done in furtherance of contract. There must be real
nexus between ‘contract’ and the ‘acts done in pursuance or furtherance
thereof’.

CASE LAWS:-

1. Sheth Maneklal Mansukh Bhai v. Messrs. Hormusji Jamshedji[9]

In this case, A Talukdari estate, consisting of 12 villages in the Viramgam

taluka of Ahmedabad District, was owned by many talukdars. Rampura was one
of the localities where the estate was taken over by the government under
section 28 of the Gujarat Talukdars Act.

Maneklal Mansukhbhai, the complainant, applied to Talukdari settlement

officer in 1916 for a permanent lease.

So, on the 12th of July 1917, he granted permission to the petitioner because he
was in desperate need of a place to set up his ginning factory, and he sent a
letter to the government requesting their approval, which was signed by both the
proposer and the officer, indicating that he accepted the petitioner’s proposal
and agreed to lease the land after the government approved it.

It was also agreed that the lessee would take possession of the land after the
private settlements between him and the existing tenants were completed.

In addition, if no settlement is made, the settlement officer stated that he would

make arrangements to evict the renter. Finally, on July 20, 1917, the
government gave its approval.

Although a draught had been developed, a formal registration was yet to be

completed. The plaintiff then built up the factory and bungalow, and he
continued to pay the rent for nearly two years, even though the management
was moved to that of the talukdars, as per the deed.

In 1924, the plaintiff gave the defendant, Hormusji Jamshedji, a mortgage or

ijaradar on the property and buildings on it, making them the mortgagee.

In 1933, when they were unable to pay the rent, the mortgagee acquired control
of the mortgaged property using equity of redemption. All of Manilal
Maganlal’s rights were transferred to the defendant as a result of this.

The plaintiff now claims that because the defendants do not have a permanent
lease in their name, they are unable to take ownership of the land and has filed a
lawsuit to evict them.

So, the defendants claimed the land, claiming that because the plaintiff did not
have a registered lease document, they were never the lessees in the first place
and were only trespassers, and that the Talukdar Settlement Officer’s lease was
also contested.

As a result, the defendants argued that they were the long-term tenants and that
the plaintiff should be evicted.
So, the Trial Court determined that the lease agreement was invalid and that the
equitable part performance theory did not apply in this case, implying that
defendants were the rightful tenants.

Furthermore, the Assistant Judicial Magistrate stated that Section 53 A is a

complete answer in this case, and that because there was a written agreement
with the government by annexure Ex.181 it can be taken as evidence for the
same, even though no registered deed is available.

Plaintiffs had a lease agreement and thus had the doctrine of estoppel, so the
defendants filed an appeal.

However, the Bombay high court overturned this decision, stating that the
defendants treated the plaintiffs as landlords because they were paying their
rentals, but that they would not be permanent lessees.

Because there was no primary proof of a registered lease deed, the high court
dismissed the plaintiff’s claim, ruling that the defendants lacked legal standing.
As a result, both parties were harmed.

The Supreme Court discussed Section 53A of the Transfer of Property Act

1882 in detail, with the clause stating that any written agreement, i.e., a signed
contract by both parties, must be present, and some work must be done in line
with the part performance.

As a result, Ex. 181 was considered secondary evidence in this case, and it was
said that there was a written contract in the government files that was signed by
both T.S.O. and Manilal.

As a result, this was deemed sufficient evidence for the same.

It is also stated that the equity of part performance, which is drawn from
English law, is actively implemented in the laws of lease termination. Hence,
there was no need to execute a registered lease deed.

As a result, there existed a lease agreement, and the defendant can lease it again
once the deed is registered and the plaintiff relinquishes all rights.

As a result, the Court decided that a formal deed isn’t required if both parties
sign a written agreement that can be proven by proof.

Thus, the High Court’s ruling was overturned, and the Assistant Judge’s
decision was reinstated.

2. Moolchand Bakhru & Anr v. Rohan & Others[10]

In this matter, Mr. Moolchand had written many letters to Mr. Bhagwan Das,
requesting that he sell his half-share interest in the property because he needed
money.

Respondents, on the other hand, took possession of the property, claiming that
the letters were a contract to give the property away, and that Bhagwan Das
now has adverse possession of the entire property.

Therefore, the aggrieved plaintiff went to Court, where the High Court stated
that the defendants could not be given possession because of adverse
possession, but rather because of letters written by Moolchand to Bhagwan Das
stating that the property should be sold, but that they would continue to be in
joint possession with no mesne profits to be paid to the plaintiff.

As a result, the case was taken to the Supreme Court.

The Supreme Court noted that the letters written by Moolchand to Bhagwan
Das stating that he would give his half share of the property in exchange for
some money could not be considered a written agreement between the parties,
and that it could only be considered an oral agreement.

Furthermore, the term of the agreement must be seen and its reasonableness
must be determined before deciding whether it is an oral or written agreement.
In this situation, he has written about selling his part of land, but the other
essentials of a sale agreement have not been met.

As a result, the requisite terms cannot be determined from the letters, and they
will not be covered by Section 53A as letters construed only as an oral
agreement.

This was also important because, under Section 53A, the transferee must be
provided possession in order to protect his interest in part performance, and
Bhagwan Das was never given possession, even after a written agreement was
established.

Hence, the respondents in this case were required to pay mesne profits to the
plaintiffs because they were not in possession of the property, as stated by the
Supreme Court in overturning the High Court’s decision.

3. Union of India v. M/s K.C. Sharma & Co.& Ors

Here, Gaon Sabha Luhar Heri, Delhi, owned 36 bighas and 11 bhiswas of land.

The Government (Appellants) acquired this land under sections 4(1) and 6 of
the Land Acquisition Act of 1894.

So, in this case, the respondents (K.C. Sharma) claimed that the land was given
to them on lease by Gaon Sabha, i.e., the Gram Panchayat, and that because the
government now owns it, they must compensate the respondents under the
award proceeding instituted by the respondents in the Civil Court under sections
30 and 31 of the Land Acquisition Act, 1894.
The land had been allocated by the gramme sabha to be cleared of’ shora’ and
made cultivable. As a result, they had been farming the land and removing all
‘shora’ in accordance with this.

As a result, the case was taken to the city Civil Court in 1989, where the extra
District Judge Delhi ruled that the government is obligated to compensate the
respondents for 87 percent of the loss experienced as a result of the acquisition,
and the gram panchayat for 13 percent.

The government claimed in 1992, in support of this order, that the respondents
were not the lessees of the Goan Sabha, and even several locals agreed.

As a result, a Writ of Habeas Corpus was filed in the Delhi High Court.

The High Court dismissed the writ in 1997, asking the Additional District
Magistrate to intervene under section 18 of the Land Acquisition Act of 1894,
and deciding whether or not a separate action was required.

At this point in the proceedings, Gram Sabha has submitted an application

under Order 1 Rule 10 to add a person as a party to the investigation.

Then, in 2005, Union of India filed a separate litigation in the Delhi High Court,
which was then transferred to the Additional District Judge because of the
pecuniary jurisdiction.

They argued that the Court’s 1989 order was founded on fraudulent facts.

They further claimed that the ex-Pradhan worked with the respondents and that
the land was only supplied for a five-year term.

In 2006, the Delhi High Court ruled that the Union of India had failed to prove
the fraud due to a lack of evidence.
At the time of the land transfer, an acceptable agreement was reached and
signed by all parties.

Furthermore, the land auction at the time was conducted through fair bidding
and was regulated. As a result, there is no evidence of cooperation.

The Respondent’s Appeal was granted, and the Trial Court’s decision was
reversed.

Further, the case went to the Supreme Court, where the ASG on behalf of the
appellant claimed that the respondents were not entitled to 87 percent of the
compensation and that the Trial Court’s Judgement and decree were proper, but
the High Court reversed it without considering that the judgement was obtained
through fraud.

They claimed that the compensation award was gained through fraud, and that
because there was no lease document, it could only be interpreted as a
permission to labour on the land, there was no reason to compensate them. T

he respondent claim that the evidence on record shows that Goan Sabha
intended to lease the land, and that the land was pleased with the agreement of
the Dy. Director Panchayat.

And because the respondents have owned land for over 30 years, there was no
need to discuss a licence.

Even though no lease deed was executed or recorded, the learned Senior
Counsel stated that the respondents are entitled to such possession of land and
benefit under section 53 A of the Transfer of Property Act, 1882, based on the
doctrine of part performance.
The High Court’s ruling on fraud was maintained by a three-judge bench
consisting of J. Ashok Bhushan, J. R. Subhash Reddy, and J. M.R. Shah on
August 14, 2020, because there were insufficient evidences.

The Trial Court’s ruling for compensation from 1989 was upheld.

According to section 53 A of the Transfer of Property Act, the respondents were

placed in possession of the land by way of lease, and it makes no difference
whether there was a lease deed or not because there was an agreement and the
parties’ intents were apparent, as the facts clearly establish .

The lease was also approved by the board of directors.

As a result, the court stated that those who have acted on a legitimate sale of
contract but do not have a valid registered deed in their favour will have their
right of possession safeguarded.

As a result, regardless of whether there is a registered or documented sale deed

or not, the transferee has the right to safeguard his ownership from the
transferor under Section 53A of the Transfer of Property Act, 1882.

Conclusion:
Thus, the doctrine of part performance is an equitable doctrine. It is
incorporated to prevent fraud from taking advantage on account of non-
registration of the document. It is based on the doctrine: Equity looks at the
intention rather than form.