Supreme Court Rules on Rights of Pendente Lite Transferees in H. Anjanappa & Ors. vs. A. Prabhakar & Ors.
The Hon’ble Supreme Court of India, in the landmark case of H. Anjanappa & Ors. vs. A. Prabhakar & Ors., ruled that a pendente lite transferee (a person who purchases a disputed property during ongoing litigation) does not automatically have the right to be impleaded in a suit. The Court emphasized that such an impleadment is only permitted in exceptional circumstances where the transferee's rights are significantly jeopardized.
Key Legal Principles Established by the Supreme Court
A bench comprising Justice JB Pardiwala and Justice R Mahadevan laid down the following principles:
Discretionary Impleadment: The Court can allow a pendente lite transferee to be impleaded under Order I Rule 10 CPC or Order XXII Rule 10 CPC, based on case-specific facts.
No Automatic Right: A transferee pendente lite does not have an inherent right to be impleaded.
Case-Specific Allowance: Courts are not bound to implead a transferee in all cases.
Nature of Suit Matters: The decision depends on the nature of the litigation and available evidence.
Risk of Non-Impleadment: If a transferee does not seek impleadment, they bear the risk of unfavorable proceedings.
Binding Effect of Judgment: Even if a transferee pendente lite is not impleaded, they are bound by the court's ruling.
Applicability of Section 52 TPA: Any sale during litigation is subject to Section 52 of the Transfer of Property Act, 1882.
Right to Seek Leave to Appeal: A transferee pendente lite can seek court permission to be impleaded on their own or at the request of another party.
Case Background & Supreme Court's Judgment
In this case, Respondent Nos. 1 and 2 purchased a property while a suit for specific performance was pending. Their plea for impleadment was dismissed by the trial court and attained finality as no appeal was filed. Later, when the trial court ordered the execution of the sale deed in favor of the plaintiff, Respondent Nos. 1 and 2 filed an appeal in the Karnataka High Court, which granted them leave despite their non-impleadment.
However, the Supreme Court overturned the High Court’s decision, ruling that since their impleadment plea was already dismissed, they had no right to appeal. The Court held that only an aggrieved person whose rights are directly affected can file an appeal, which was not the case here.
Impact of Section 52 of the Transfer of Property Act, 1882
The Court reaffirmed that while pendente lite transfers are not void, they remain subject to the final judgment of the case. Since Respondents 1 and 2 purchased the property while litigation was pending and under an injunction, their plea lacked merit.
Observations by the Court
The Supreme Court explicitly rejected the argument that Respondents Nos. 1 and 2 should be impleaded because they were deceived by the seller. It clarified that if they were cheated, they could pursue separate legal remedies against the seller but not interfere in the ongoing litigation.
Final Verdict
The Supreme Court allowed the appeal, overruling the Karnataka High Court's decision and upholding the trial court’s stance that Respondents 1 and 2 had no right to challenge the judgment.
This ruling sets a significant precedent in property litigation, reinforcing that pendente lite transferees must adhere to existing legal principles and cannot intervene in ongoing suits without substantial cause.