What is doctrine of lis pendens? Discuss whether the doctrine would be applicable in case of (1) Judgment Debtor,.... (2) Transfer was made under pre-existing rights.

Question: What is doctrine of lis pendens? Discuss whether the doctrine would be applicable in case of (1) Judgment Debtor, who sells suit property during execution. (2) Transfer was made under pre-existing rights. [MPJS 2011]

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Answer

The Doctrine of Lis Pendens, derived from Latin, translates to “pending litigation.” It is a legal principle that pertains to immovable property and is dealt with in Section 52 of the Transfer of Property Act, 1882, in India.

The doctrine of lis pendens can be defined as the legal authority, control, or jurisdiction that a court holds over the property in question during the entire duration of a lawsuit, extending until a final judgment is reached. It encompasses the set of laws, norms, and principles that govern and restrict the application of the common law maxim, which stipulates that no modifications regarding the subject of a lawsuit can be made while it remains unresolved.

Section 52 of the Transfer of Property Act lays down the provision regarding the doctrine of lis pendens. According to Section 52:

During any ongoing legal proceedings, within India or established by the Central Government, where specific rights to immovable property are at stake and the proceedings are non-collusive, no party can transfer or deal with the property in a way that affects the rights of others without the court's authorization and on terms it may impose.

The doctrine of lis pendens is essential as it prevents the transfer of the title of any disputed property without the Court’s consent, there can be endless litigation, and it will become impossible to bring a lawsuit to a successful termination if alienations are permitted to prevail, and covenants are not imposed.

The ‘Transferee pendente lite’ is bound by the verdict just as if he were a party to the suit and the transfer shall be subservient to the result of the pending lawsuit.

(1) Whether the doctrine would be applicable in the case of the Judgment Debtor, who sells suit property during execution.

In the given scenario, if a Judgment Debtor sells the suit property during the execution of a judgment, and if the litigation is still ongoing, Section 52 would generally apply to restrict the transfer or any other dealings with the property.

The principle of lis pendens, as elucidated by the Hon’ble Supreme Court in Thomson Press (India) Ltd. v. Nanak Builders & Investors P.Ltd., Civil Appeal No. 1518 of 2013, underscores that a transferee pendente lite is bound by the court's decision as if they were a party to the suit. While a pendente lite transfer is effective in transferring title, it remains subservient to the rights of the transferor in the pending suit and is subject to any decision the court may ultimately render. Relevant observations of the Supreme Court in the said judgment are set out below:

“ It is well settled that the doctrine of lis pendens is a doctrine based on the ground that it is necessary for the administration of justice that the decision of a court in a suit should be binding not only on the litigating parties but on those who derive title pendente lite. The provision of this Section does not indeed annul the conveyance or the transfer otherwise, but to render it subservient to the rights of the parties to a litigation. Discussing the principles of lis pendens, the Privy Council in the case of Gouri Dutt Maharaj v. Sukur Mohammed & Ors.AIR (35) 1948, observed as under:

“The broad purpose of Section 52 is to maintain the status quo unaffected by the act of any party to the litigation pending its determination. The applicability of the section cannot depend on matters of proof or the strength or weakness of the case on one side or the other in bona fide proceedings. To apply any such test is to misconceive the object of the enactment and in the view of the Board, the learned Subordinate Judge was in error in this respect in laying stress, as he did, on the fact that the agreement of 8.6.1932, had not been registered.”

Therefore, in the given scenario, the doctrine of lis pendens would likely be applicable, and any sale or transfer of the suit property by the Judgment Debtor during the execution phase would be subject to the authority of the court and the terms it may impose.

(2) Whether the doctrine would be applicable in case of Transfer was made under pre-existing rights.

The doctrine of lis pendens applies only to a transfer Pendente lite, but it cannot affect a pre-existing right. The Full Bench of the East Punjab High Court in Wazir Ali Khan v. Zahir Ahmad Khan, A.I.R. 1949 East Punj. 193, At p. 195, the learned Judges observed:

" It is settled law that unless a transfer pendente lite can be held to be a transfer in recognition of a subsisting preemptive right, the rule of lis pendens applies and the transferee takes the property subject to the result of the suit during the pendency where of it took place".

In the case of Bishan Singh & Others v. Khazan Singh & Another, 1958 AIR 838, before the Hon’ble Supreme Court, it was held:

If the sale is a transfer in recognition of a preexisting and subsisting right, it would not be affected by the doctrine, as the transfer does not create a new right Pendente lite but if the preexisting right became unenforceable because of limitation or otherwise, the transfer, though ostensibly made in recognition of such a right, in fact creates only a new right pendente lite.

Referring to the said legal position on the doctrine of lis pendens, the court held that, the appellants’ right of pre-emption was subsisting and was not barred by limitation at the time of the transfer in their favour as they had filed a suit and had obtained a decree and the coercive process was still in operation. Consequently, the appellants were not hit by the doctrine of lis pentlens and they acquired an indefeasible right to the land when they took possession of it after depositing the purchase money in court.