Sale Deed Executed without Payment of Price is Void as payment of Price is an essential part of a Sale: Supreme Court [Read Judgment]

The Supreme Court held that the Sale Deed executed without payment of the price is void as payment of the price is an essential part of a sale.

The appellant, Kewal Krishan executed a power of attorney in favor of Sudarshan Kumar on 28th March 1980. Acting on the basis of the said power of attorney, two sale deeds were executed by Sudarshan Kumar on 10th April 1981. The first sale deed was executed by him by which he purported to sell a part of the suit properties to his minor sons. The sale consideration was shown as Rs.5,500/-. The other sale deed was executed by Sudarshan Kumar in favour of his wife in respect of the remaining part of the suit properties. The consideration shown in the sale deed was Rs.6,875/-. The respondents are Sudarshan Kumar, his wife, and his sons.

The Trial Court dismissed the suits filed by the appellant. The Trial Court held that the suit lands were intended to be purchased only by Sudarshan Kumar and that is how the original sale deeds were in possession of Sudarshan Kumar. The Trial Court accepted the contention that he was the exclusive owner and the appellant was the benamidar. The Trial Court upheld the contention of Sudarshan Kumar regarding legality and validity of the power of attorney and both the sale deeds which were the subject matter of challenge. Trial Court held that as Sudarshan Kumar was the only owner of the suit properties, the appellant was disentitled to any relief. The Trial Court also held that the prayer for grant of a share in compensation in respect of the tube well was barred by provisions of Rule 2 of Order II of the Code of Civil Procedure, 1908.

The division bench of Justice Ajay Rastogi and Justice Abhay S.Oka held that a sale of immovable property has to be for a price. The price may be payable in the future. It may be partly paid and the remaining part can be made payable in the future. The payment of the price is an essential part of a sale covered by section 54 of the TP Act. If a sale deed in respect of immovable property is executed without payment of the price and if it does not provide for the payment of the price at a future date, it is not a sale at all in the eyes of law. It is of no legal effect. Therefore, such a sale will be void. It will not effect the transfer of the immovable property.

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