DOCTRINE OF LIS PENDENS [Section 52]

Transfer of Property Act, 1882

TANMOY MUKHERJI INSTITUTE OF JURIDICAL SCIENCE

Dr. Tanmoy Mukherji

[Advocate]

 

DOCTRINE OF LIS PENDENS [Section 52]

 TANMOY MUKHERJI

Advocate

 

 

Section 52 of the Transfer of Property Act, 1882 deals with 'the Doctrine of Lis Pendens'. Section 52 relates to Transfer of Property pending suit relating thereto. It runs as follows:

-During the pendency in any Court having authority within the limits of India excluding, the State of Jammu and Kashmir or established beyond such limits by the Central Government of any suit or proceeding which is not collusive and in which any right to immovable property is directly and specifically in question, the property cannot be transferred or otherwise dealt with by any party to the suit or proceedings so as to affect the rights of any other party thereto under any decree or order which may be made therein, except under the authority of the Court and on such terms as it may impose.

Explanation-

For the purposes of this section, the pendency of a suit or proceeding shall be deemed to commence from the date of the presentation of the plaint or the institution of the proceeding in a Court of competent jurisdiction, and to continue until the suit or proceeding has been disposed of by a final decree or order and complete satisfaction or discharge of such decree or order has been obtained, or has become unobtainable by reason of the expiration of any period of limitation prescribed for the execution thereof by any law for the time being in force.

Amendment- Section 52 has been amended by Section 14 of the Transfer of Property (Amendment) Act 20 of 1929. The word 'pendency' has been substituted for the words 'active prosecution' which gave rise to a great conflict of decisions. The words 'any suit or proceedings which is not collusive' have been substituted for the words 'a contentious suit or proceeding' which also led to conflicting decisions on the question as to when a suit or proceeding became contentious. To remove this latter conflict, an explanation is also added fixing the time during which a suit is deemed to be pending for the purposes of the section.

Meaning –

-The expression 'Lis' means "litigation" (or an action or a suit). 'Pendens' means "pending" (continuing). Lis pendens collectively means 'pending suit or an action'.

-According to the doctrine, 'where a suit is pending before the competent court, in which any right to property is (directly or indirectly or specifically) in question, the property cannot be transferred or dealt with by any party to the suit except under the authority by Court or such terms as it may impose'.

-In simple words, when title of property is in question before a court of competent jurisdiction, such property should not be transferred by way of sale or gift or lease or mortgage. If transferred, such transfer is invalid and the transferee has no claim.

Examples-

(1) 'A' says that he is the owner of property 'X'. 'B' also claims to be the owner of the same property 'X' and sued 'A'. When the matter (i.e. dispute as to title of the property) is pending before the Court, 'A' cannot transfer the property by sale or gift etc. If so such transfer is not valid.

Case References-

 

Bellamy vs. Sabine (1857) 1 De C & J. 5661 -

In this case, 'F' being an heir sued 'E' for selling an estate to 'S'. During pendency of the suit 'S' transferred it to 'B', who had notice (knowledge) of the suit. The court through Turner, L.J. held in favour of 'F'.

Turner, L.J. observed- 'When a litigation is pending between a plaintiff and a defendant as to the rights to the particular estate, the necessity of mankind requires, that the decision of the Court shall be binding not only on the litigant parties, but also on those who derive title under them by alienation made pending the suit.'

Faiyaz Hussain Khan vs. Prag Narain (1907) 29 All 399-

The effect of the application of the doctrine is that it does not annul the conveyance, but only renders it subservient to the rights of the parties to the litigation.

Jayaram Mudaliar vs. Ayyaswami and others, AIR 1973 S.C. 569- Supreme Court  held 'The purpose of Section 52 of the T.P.Act is not to defeat any just and equitable claim but only to subject them to the authority of the Court, which is dealing with the property to which claim are put forward'.

Underlying Principle-

The Doctrine of Lis-pendens is based on the Common Law maxim 'Pendente lite nihil innovator', which means, "During pendency of a litigation nothing new should be introduced". It is based upon public policy and holds good though it creates hardship to an innocent purchaser.

Section 52 when analyzed shows that it is in two parts. The first part lays down the conditions for the applicability of the doctrine and the second part lays down what are the consequences if the doctrine applies.

Essential Conditions of the Doctrine-

 For application of the doctrine, the following conditions are to be satisfied-

(1) There must be pendency of a suit or pendency of a proceeding.

(2) The pendency of suit must be in the court of competent jurisdiction (Competent Court).

(3) The suit or proceeding should not be collusive.

(4) A right to immovable property should be (directly or indirectly or specifically) in question in the suit. (The question involved in the suit must be a right to immovable property).

(5) The transfer should be made by one of the parties to the litigation without authority of the court.

(6) The alienation must affect the right of the other party.

1.Pendency of a suit-

-The pendency of suit commences from the date of filing of plaint, and continues till the disposal of the suit by a decree or an order. Appeals and execution proceedings come within the purview of continuation of the proceedings. If the plaint is filed in High Court and is returned for presentation in Lower Court competent to try, the pendency commences from the date of filing in the High Court. If the suit is first filed in lower court and from there, if it is returned for presentation in High Court, then the pendency commences from the date of presentation in the High Court.

-There was a conflict of opinion as to the question, 'whether the pendency commences from the date of filing a suit or date of serving the summons. The Privy Council settled this question in-

Prag Narayan vs. Priyaz Hassan Khan, 29 All. 339-

 That the pendency of a suit commences from the date of filing of the plaint and not from the date of serving of summons.

In the case Hari Lal vs. Balwantia and others, AIR 1998 Alld. 211-

It was held that if the plaintiff was entitled to get maintenance in the life time of his husband and could pray for charge against the property of her husband, later this right of the wife would not be affected by the sale deed executed during the pendency of the suit on the transfer of such property to the defendants and the sale deed would be hit by virtue of Section 52 of the Transfer of Property Act.

2. Competent Court-

 Section 52 applies if the suit is pending before the Court of competent jurisdiction.

3. Must not be collusive-

 The doctrine (Section 52) is not applicable if the suit is collusive. A collusive suit is not real and it is a preplanned one to defeat the defendants.

4. Immovable Property-

The issue or question involved in the suit must be a right with regard to an immovable property.

5. Actual transfer-

For application of the doctrine, there must exist actual transfer which includes sale, gift, mortgage, lease etc.

6. Affecting another's right-

For application of the doctrine, the transfer should affect the right of another person. The transfer during pendency is not ipso facto void, but voidable. The doctrine is not applicable if the rights of the transferor alone are affected and not the rights of parties to the suit.

Applicability of Lis Pendens-

It applies to those transfers which are made during pendency of suit or appeal arising out of that suit. Such transfers are liable to be declared void and invalid.

Doctrine in India-

The leading case on this doctrine in India is -

Faiyaz Hussain Khan vs. Prag Narian (29 All 339)-

 In which the Privy Council quoted with approval the observation of Turner, LJ, and Lord Cranworth in Bellamy's case, and many other cases in this country involving the question of lis pendens have been decided on the same principle. The rule, it will be obvious, is not based on the doctrine of notice but on expediency, i.e. the necessity for final adjudication.

 National Textile Corporation (U.P) Ltd., Karipur vs. Swadeshi Cotton Mills Co. Ltd. and others (2000(1) A.W.C. 2.11(Noc)-

It was held that Section 52 enacts the doctrine of lis pendens. It imposes a prohibition on transfer or otherwise dealing with any property during the pendency of a suit, provided, the conditions laid down in the section are satisfied.

Exceptions-

 The Doctrine of Lis Pendens is not applicable in the following cases.

(1) Where transfer takes place with the consent of the Court.

(2) Where the transfer relates to money disputes.

(3) Where the transfer is for revenue sales.

Res judicata and Lis Pendens-

The rule of Res judicata prevents the owner from dealing Lis. Pendens and once a judgment is pronounced by a competent court in regard to the subject matter of the suit in which the doctrine of Lis Pendens applies, the decision is res judicata and binds not only party to the suit but also the transferee Pendente Lite.

Lis pendens and the Doctrine of notice-

The rule contained in Section 52 of the Transfer of Property Act is, however, not based on the doctrine of notice but on expediency. The lis pendens rule does not annul the transfer but only renders it subservient to the rights of the parties to the litigation. According to this rule, therefore, whosoever purchases a property during the pendency of a suit is bound by the judgment that may be made against the person from whom he derived title even though such a purchaser was not a party to the action or had no notice of the pending Litigation.