Facts
The plaintiffs sought a declaration that two registered sale deeds dated 10.03.1975 were void and inoperative on the ground that the defendant had paid only part of the sale consideration and failed to discharge the plaintiffs' outstanding debts as agreed. The Trial Court and First Appellate Court dismissed the suit, but the High Court, in second appeal, declared the sale deeds inoperative.
Issues Framed
Implied Issues:
(a) Whether non-payment of the balance sale consideration renders a registered sale deed void or inoperative.
(b) Whether the High Court was justified in granting cancellation of the sale deeds instead of limiting the plaintiffs to recovery of the unpaid consideration.
Court's Reasoning
(a) The Court held that under S.54 Transfer of Property Act, 1882, payment of the entire sale consideration is not a condition precedent for completion of a sale. A registered sale deed transfers title even where part of the price remains unpaid. (Paras 10–12).
(b) Relying on Vidhyadhar v. Manikrao, (1999) 3 SCC 573, and Dahiben v. Arvindbhai Kalyanji Bhanusali, (2020) 7 SCC 366, the Court reiterated that the remedy for non-payment of the balance consideration is recovery of the unpaid amount, not cancellation of the sale deed. (Paras 10–14).
(c) The High Court erred in treating the sale deeds as void merely because the defendant failed to fulfil his promise to pay the balance consideration and clear the plaintiffs' debts. The sale had become final upon execution and registration. (Paras 13–15).
Held
The appeal was allowed. The High Court's judgment was set aside, and the judgments of the Trial Court and First Appellate Court were restored. The plaintiffs were held entitled only to recover the balance sale consideration with interest and not to cancellation of the sale deeds.
Conclusion
A registered sale deed is not rendered void or inoperative merely because the balance sale consideration remains unpaid; under S.54 TPA, title passes on execution and registration, and the vendor's remedy is recovery of the unpaid consideration.
Relevant Para
Para 14
“The sale deed executed with full knowledge of the part consideration alone having been passed, cannot be rendered void or inoperative merely because the balance consideration promised to be paid, which promise was incorporated in the sale deed, had not been complied with. The right of the plaintiffs was to file for recovery of balance sale consideration and not to seek declaration that the sale deeds were null and void; which they are not.”
Case Details
Citation: 2026 INSC 814
Decided on: 07 August 2026
Case Title: Raziya Begum & Ors. v. Nafisa Begum Abdul Hamid & Ors.
Court: Supreme Court of India
Bench: J. B. Pardiwala, J.; K. Vinod Chandran, J.