Doctrine of Part Performance | Property Law - CLAT PG PDF Download

Introduction

• The Doctrine of Part Performance is an equitable principle designed to prevent fraud and misuse arising from the non-registration of documents.
• It is based on the maxim that equity considers what has been done rather than what ought to have been done.
• The doctrine essentially states that the transferor or anyone claiming under them cannot enforce against the transferee or their successors any rights regarding the property, except for those explicitly outlined in the contract, if the transferee has taken or continued possession of the property.

Definition

The doctrine of part performance is outlined in The Transfer of Property Act, 1882.

• Section 53-A of the Act defines the doctrine as follows:
• When a person contracts to transfer immovable property for consideration through a written agreement signed by him or on his behalf, from which the terms of the transfer can be reasonably ascertained, and the transferee has taken possession of the property or any part of it in part performance of the contract, or the transferee, already in possession, continues in possession in part performance of the contract and has undertaken some action in furtherance of the contract, and the transferee has fulfilled or is willing to fulfill his part of the contract, then, despite the transfer not being completed as per legal requirements, the transferor or anyone claiming under him is barred from enforcing against the transferee and his successors any rights concerning the property of which the transferee has taken or continued possession, except for rights explicitly stated in the contract.
• However, this section does not affect the rights of a transferee for consideration who is unaware of the contract or its part performance.

Illustration

• If A agrees to sell his immovable property to B and puts B in possession of the property before a formal Sale-Deed is executed, the contract is considered to be partly performed.
• If later A refuses to execute the formal sale document and files a suit to evict B, treating B as a trespasser, B can defend himself by arguing that the contract of transfer in his favor has been partly performed, and A should not be allowed to go back on his promise.

Ingredients of Section 53-A

• There must be a contract for the transfer of immovable property for value.

Written Contract

• The contract must be in writing. Section 53-A does not apply to oral contracts.
• The contract should be duly executed, meaning it must be signed by the transferor or someone on their behalf.

Valid Contract

• The contract for transfer must be valid in all respects and enforceable under the Indian Contract Act, 1872.

Immovable Property

• Section 53-A is applicable only to the transfer of immovable property and not to movable property.

Transfer for Consideration

• The written contract must clearly indicate the transfer of immovable property for consideration.
• The terms of the written contract should be ascertainable with reasonable certainty.

Possession in Furtherance of Contract

• The transferee must have taken possession or continued possession in part performance of the contract.
• If the transferee is already in possession, they must do some act in furtherance of the contract.

Transferee Willing to Perform

• The transferee must be willing to perform their part of the contract.
• Their conduct must be equitable and just.

Scope of Doctrine of Part Performance

• The Doctrine of Part Performance applies only to written and valid contracts. It is not applicable to oral or void agreements.
• The contract must be in writing and signed by the transferor.
• The transferee must have taken possession of the property as part performance of the contract and must be ready and willing to perform their part of the promise.
• This section is applicable not only to contracts of sale but to all contracts of transfer for consideration.
• The doctrine is intended to be used as a shield, not a sword.

Legal Effect of the Amending Act (48 of 2001) in Section 53-A

• The amendment in Section 53-A of the T.P. Act, which removed the requirement for registration of contracts, suggests that non-registration is not a relevant factor for the application of part performance.
• However, this should be read in conjunction with the amendments in Section 17 and Section 49 of the Registration Act.
• The amendments aim to prevent perpetual possession of immovable property evading the law of registration.
• Section 53-A now requires proof of acts done in furtherance of the contract.