Sale Deed Executed In The Teeth Of Injunction Order: Telangana HC Dismisses Pendente Lite Purchaser's Appeal

The appeal was dismissed on the ground of maintainability since there was an injunction order that restrained alienation of the scheduled property by way of sale, gift, lease or creating any third-party interest over the suit property until further orders of the court. The Court explained that an appeal was not allowed in this situation.

A Division Bench of Justice Moushumi Bhattacharya and Justice Nagesh Bheemapaka found, “We accordingly hold that the order dated 18.09.2015 was a consent order recording the consent of both the plaintiffs as well as the defendants and that the appellant/defendant No.2 cannot contend otherwise. The appellant would therefore fall under the embargo of reopening the consent order or challenging the same under section 96(3) of the C.P.C”

Senior Advocate A. Venkatesh appeared for the appellant, while Senior Advocate V. Ravinder Rao represented the respondents.

The respondent had filed a suit for the specific performance of an agreement of sale. The Trial Court thereby granted ad interim injunction by restraining the defendant from alienating or creating any interest in the suit schedule property in favour of any third party. However, the defendant alienated the suit schedule property in favour of the appellant.

The High Court noted that the appeal challenged the judgment which directed the appellant, to execute a registered sale deed in favour of the respondent for the property, as per an agreement of sale.

The Court found that the judgment of the Trial Court was based on the mutual consent of both parties, as recorded in the consent order. “Section 96 (3) of The Code of Civil Procedure Code, 1908, which relates to Appeal from original decree, contains an embargo on filing an Appeal from a decree passed by a Court with the consent of the parties,” it remarked.

The appellant's argument that the impugned judgment was not a consent decree was rejected by the Court. “Admittedly, the appellant/defendant No.2, is a purchaser pendente lite which entered into a transaction with the defendant No.1 for purchase of the suit schedule property in the teeth of the order of injunction passed by the Trial Court,” the Bench noted.

The Bench stated that the issue of maintainability was grounded on whether the transactions in favour of the appellant, being in violation of the order of injunction, could have any legal sanctity.

Therefore, it was held, “We are of the view that the defendant No.2/appellant purchased the property in the teeth of the injunction order and hence is disentitled from pursuing further remedies against the impugned judgment.”

Accordingly, the High Court dismissed the appeal.

Cause Title: B. Narasimha Reddy v. T. Seshikanth Reddy

Appearance:

Appellant: Senior Advocate A. Venkatesh

Respondents: Senior Advocate V. Ravinder Rao; Advocate P. Madhusudhan Reddy

Click here to read/download the Judgment