TP Act | Suit For Injunction & Declaration Against Alienation Not Maintainable Under Agreement To Sell Without Claiming Specific Performance: Madhya Pradesh High Court

 "Thus, in absence of any relief for specific performance of agreement to sell, there is no chance of plaintiff's acquiring title over the suit property. Further, without having title over the property, the plaintiff was not entitled to a decree of permanent injunction also." Madhya Pradesh High Court has held that an agreement to sell does not confer title or transfer any interest in an immovable property, and a suit seeking a negative declaration and injunction to restrain alienation without claiming specific performance is legally impermissible.

A single bench of Justice Ashish Shroti observed that "in absence of any relief for specific performance of agreement to sell, there is no chance of plaintiff's acquiring title over the suit property," while setting aside the concurrent decrees passed by the courts below.

The plaintiff instituted a civil suit based on a registered agreement to sell dated December 27, 1989, seeking a declaration that defendant no. 1 had no right to alienate the suit land and a permanent injunction restraining alienation. During the pendency of the proceedings, the property was sold via a registered sale deed to defendant no. 4, prompting the plaintiff to challenge the subsequent conveyance without seeking specific performance of his own agreement. Both the Trial Court and the First Appellate Court decreed the suit in favor of the plaintiff, prompting defendant no. 4 to approach the High Court in second appeal.

The primary question before the court was whether the courts below erred in granting a decree of declaration and permanent injunction on the strength of an agreement to sell without the plaintiff claiming specific performance. The court was also called upon to determine whether a non-executant seeking a declaration to render a sale deed ineffective is liable to pay ad valorem court fees.

Agreement To Sell Does Not Confer Title Or Proprietary Interest

Examining the pleadings, the High Court observed that the plaintiff asserted his ownership over the suit property solely based upon the registered agreement to sell, wherein part-payment was made and possession was allegedly delivered. The bench emphasized that under the statutory framework, such an agreement represents merely an executory contract.

"Thus, it is evident that the parties only agreed to sell the suit land, but title of the land was not conveyed in favour of the plaintiff. Plaintiff's assertion of acquiring title over the suit land based upon the agreement to sale dated 27.12.1989, was thus, not acceptable."

Relying on the landmark Supreme Court ruling in Suraj Lamp & Industries (P) Ltd. v. State of Haryana, the court reiterated that Section 54 of the Transfer of Property Act, 1882 explicitly establishes that a contract of sale does not, of itself, create any interest in or charge on property. Immovable property can be transferred only through a registered deed of conveyance.

Suit For Mere Negative Injunction Without Specific Performance Is Impermissible

The court underscored that a prospective vendee cannot seek a negative injunction or a bare declaration against the vendor alienating the property without praying for the substantive relief of specific performance. Citing the High Court's earlier decisions in Prem Bai v. Smt. Neelam and Nehal Shah v. Jameet Singh Kachhwahe, the bench stressed that an agreement holder lacks proprietary title.

The bench referred to the Supreme Court's pronouncement in Correspondence, RBANMS Educational Institution v. B. Gunashekar, which clarified that unless a conveyance is executed, the intending purchaser holds no title to institute suits against third parties, except for the limited remedy of claiming specific performance against the vendor.

The court noted that Section 41(j) of the Specific Relief Act, 1963 expressly bars the grant of an injunction when the plaintiff has no personal interest in the subject matter. Because the plaintiff possessed no legally enforceable proprietary right absent a decree for specific performance, he could not maintain a suit merely to interdict the owner from dealing with the property.

"Thus, the declaration sought by the plaintiff only to the effect that the defendant shall not alienate his property to anyone else and the permanent injunction to restrain him from alienating the property, was not permissible in law. No decree therefore could have been granted by the Courts below."

Non-Executants Need Not Pay Ad Valorem Court Fees For Declaratory Relief

Addressing the issue of valuation and court fees, the High Court held that a person who is not a party to an instrument is not required to pay ad valorem court fees to seek its annulment. The bench reiterated the principles enunciated by the Supreme Court in Suhrid Singh @ Sardool Singh v. Randhir Singh.

The bench highlighted that where an executant seeks the cancellation of a deed, ad valorem court fees on the consideration are mandatory, whereas a non-executant merely seeking a declaration that the conveyance is void and non-binding is only required to pay fixed court fees. The court nevertheless clarified that this finding remained inconsequential in light of the dismissal of the suit on substantive merits.

Allowing the second appeal, the High Court set aside the judgments and decrees of both lower courts and dismissed the plaintiff's suit with costs. The ruling reaffirms that prospective purchasers cannot circumvent the remedy of specific performance by maintaining suits for bare negative injunctions against vendor alienations.

Date of Decision: 23 October 2026