Registered sale deed does not automatically confer ownership of property: Supreme Court

The Supreme Court has held that a registered sale deed of a property cannot by itself establish ownership over the property if the seller did not have a clear title to begin with [Mahnoor Fatima Imran & Ors. vs. M/S Viswesara Infrastructure Pvt. Ltd. & Ors].A bench of Justices Sudhanshu Dhulia and K Vinod Chandran said a buyer cannot claim lawful possession of a property on the strength of registered sale deed, especially when the land was already vested with the government under land reform laws..The Court passed the ruling on May 7 in a batch of appeals related to 53 acres of land in Raidurg Panmaktha village in Telangana’s Ranga Reddy district. The land was part of a larger 99-acre parcel that had been declared surplus under the Andhra Pradesh Land Reforms Act in 1975 and had vested with the State.The appeals were filed by legal heirs of the original landowners. They challenged a Telangana High Court Division Bench order that had restrained the State from dispossessing certain individuals who claimed to have bought the 53 acres from a co-operative housing society called Bhavana Society. These buyers had relied on registered sale deeds executed in their favour..The Supreme Court found that the Bhavana Society itself had not acquired valid title. Its claim was based on an agreement of sale from 1982, which was never followed by a registered conveyance. A later-validated version of that agreement also appeared inconsistent, and the Court said both documents were unreliable. .The Bench noted that Bhavana Society had filed a suit for specific performance based on the 1982 agreement but the suit was dismissed in 2001 and never restored. The agreement was later “revalidated” without being properly registered, which the Court said was not sufficient to establish title.“There can be no valid transfer of title in the absence of a proper registered deed,” the Court held, adding that registered documents give public notice of a transaction but do not automatically confirm ownership if the seller has no right to sell..The Court also said the Division Bench of the High Court had wrongly presumed possession in favour of the buyers based on earlier interim orders passed in related cases. It said the petitioners had failed to prove actual possession.“Mere reliance on interim orders cannot establish actual and physical possession,” the Court said, adding that the principle of possession applies even more strictly in writ proceedings where no evidence is recorded..The Court restored the findings of the single judge, who had refused to protect the buyers from being evicted. It noted that the extraordinary power of the High Court under Article 226 of the Constitution should not be exercised when the claim to title is unclear and possession is disputed..The Court also pointed to a history of conflicting claims by the original landowners and their power of attorney holders before various authorities under land reform and ceiling laws. It said these proceedings showed a pattern of shifting positions depending on convenience..While noting that the State may now proceed under the Land Reforms Act to protect the land, the Court clarified that all parties would be at liberty to pursue appropriate remedies before civil courts or under applicable statutes..With these findings, the Court allowed the appeals and restored the single-judge decision, effectively lifting the protection that had been granted to the buyers from eviction..The petitioners were represented by Senior Advocate Nidhesh Gupta along with advocates Yelamanchili Shiva Santosh Kumar, Rudrajit Ghosh, Japneet Kaur, Trisha Chandran, Avi Leuna, Khyati Chhabra, Maria Jerome J, Tarun Gupta, P Mohith Rao, J Akshitha, J Venkat Sai, Eugene S Philomene, PS Sudheer, MA Chinnasamy and Devendra Pratap Singh.The respondents were represented by Senior Advocates Hiren P Raval and S Niranjan Reddy along with advocates Mahesh Agarwal, Arshit Anand, Vidisha Swarup, Aryan Rachh, Urmi H Raval, Shreshtha N, EC Agrawala, Devina Sehgal, S Uday Bhanu, Akhila Palem, D Srinivas, T Ratnakar, Somanatha Padhan and C Raghavendren..[Read Judgment]