Indira Devi … Appellant
Versus
Veena Gupta & Ors. … Respondents
CIVIL APPEAL NO. 9833 of 2014
The judgment addresses the issue of whether the right to repurchase a property, as mentioned in a conditional sale deed, can be assigned to another party or if it is personal to the vendor. The court examines previous judgments and legal principles to arrive at its conclusion.
The court begins by referencing the case at hand, where the appellant challenges an order passed by the High Court of Judicature at Patna. The facts of the case involve a conditional sale deed executed by the late Kishori Lal Sahu, who inducted the appellant as a tenant in the property. The sale deed stipulated that if the vendors (Sahu and his son) failed to repay the consideration amount by a specified date, the vendee (the appellant) would become the exclusive owner of the property. Later, Sahu executed a registered gift deed in favor of his daughter-in-law, Veena Gupta, mentioning that she could repurchase the property from the original vendee, Indira Devi.
The civil suit was filed by Sahu and Gupta, seeking specific performance of the contract to repurchase the property or, alternatively, a decree of eviction on the grounds of personal necessity and non-payment of rent. The trial court and the lower appellate court dismissed the suit, but the High Court reversed their judgments and decreed in favor of the plaintiffs. The appellant then appealed to the Supreme Court.
The primary issue before the Supreme Court was whether the right to repurchase, as stated in the sale deed, could be assigned to another party or if it was strictly personal to the original vendor. The court cites previous cases, including T.M. Balakrishna Mudaliar v. M. Satyanarayana Rao and Shyam Singh v. Daryao Singh, to analyze the assignability of the right to repurchase.
In T.M. Balakrishna Mudaliar, the court held that if a contract of repurchase does not indicate that it was intended solely for the benefit of the contracting parties, the right to repurchase can be assigned. It further states that an option to repurchase property is generally assignable unless there are specific terms indicating it is personal to the grantee. Shyam Singh case reaffirms these principles, emphasizing that unless a document explicitly prohibits assignment, the right of repurchase can be transferred.
The court concludes that unless the sale deed contains provisions explicitly prohibiting assignment or transfer, the right to repurchase is not personal to the vendor and can be assigned. It states that the assignment of obligations in a document would require the consent of the other party, but the assignment of rights is generally permissible unless the contract is of a personal nature.
Applying these principles to the present case, the court finds that there is no clause in the conditional sale deed that restricts the assignment of the right to repurchase. Therefore, the right can be assigned by the vendor, and in this case, it was assigned to Veena Gupta, the daughter-in-law of the late Kishori Lal Sahu. The court dismisses the appeal, upholding the judgment of the High Court.
In summary, the Supreme Court concludes that the right to repurchase property mentioned in a conditional sale deed is generally assignable unless there are specific provisions to the contrary. In this case, as there is no prohibition against assignment, the court upholds the assignment of the right to repurchase from the vendor to his daughter-in-law and dismisses the appeal.
Example For More Understanding
Suppose Mr. Anderson owns a property and enters into a conditional sale agreement with Ms. Johnson. The agreement states that if Ms. Johnson fails to repay the agreed-upon purchase price within five years, Mr. Anderson will become the absolute owner of the property. However, if Ms. Johnson repays the purchase price within the stipulated time, Mr. Anderson must reconvey the property to her.
Now, in this case, if the conditional sale agreement does not contain any specific provision stating that the right to repurchase is personal to Ms. Johnson, it would generally be assignable. This means that Ms. Johnson has the option to assign or transfer her right to repurchase the property to a third party, such as Mr. Thompson.
If Ms. Johnson decides to assign her right to repurchase to Mr. Thompson, she can do so through a legally valid assignment document or agreement. By assigning the right to repurchase, Ms. Johnson transfers her entitlement to repurchase the property to Mr. Thompson. As a result, Mr. Thompson becomes the new holder of the right to repurchase, and he would be entitled to exercise that right within the specified timeframe by making the necessary payments to Mr. Anderson.
However, it's important to note that if the conditional sale agreement explicitly states that the right to repurchase is personal to Ms. Johnson and cannot be assigned or transferred, then she would not be able to assign her right to Mr. Thompson or any other person. The specific provisions of the sale deed would govern whether or not the right to repurchase can be assigned.
In summary, unless the conditional sale agreement expressly prohibits the assignment or transfer of the right to repurchase, it can generally be assigned to another party. The assignability of the right to repurchase is subject to the specific terms and provisions mentioned in the sale deed.
July 4, 2023.