SHYAM SINGH versus DARYAO SINGH (DEAD) BY LRS. AND ORS.

Citation: [2003] SUPP. 5 S.C.R. 784 · Decided: 19-11-2003 · Supreme Court of India · Bench: SHIVARAJ V. PATIL · Disposal: Appeal(s) allowed

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Judgment (excerpt)

A 
B 
SHYAM SINGH 
v. 
DARY AO SINGH (DEAD) BY LRS. AND ORS. 
NOVEMBER 19, 2003 
[SHIVARAJ V. PATIL AND D.M. DHARMADHIKARI, JJ.] 
Specific Relief Act, 1963-Section l 5(b)-Agreement for sale of suit 
property-Agreement for repurchase within a specified time entered into 
C simultaneously-Transfer of the right of repurchase-Suit for specific 
performance/or enforcement of the right of repurchase-Trial Court and first 
appellate court dismissing the suit on ground that the right of repurchase, 
being a personal right, cannot be assigned or transferred to a third party-
High Court affirming on the ground that there was no express prohibition 
against assignment in favour of third party in the agreement for repurchase-
D Correctness of-Held, in law, an implied prohibition cannot be read into an 
agreement in the absence of express prohibition and hence the right of 
repurchase can be assigned or transferred to third party-Matter remanded 
to trial court on account of subsequent developments-Transfer of Property 
Act, 1882; Section 58(C). 
E 
Respondent-defendants 2 to 4 executed a registered sale deed of the suit 
property in favour of respondent I-defendant. On the same day, respondents 2 
to 4 entered into an agreement with respondent 1 for repurchase of the suit 
property within a specified time. Respondents 2 to 4 sold their rights of 
repurchase in favour ofappellant by a registered document. Appellant-plaintiff 
F filed a suit for specific performance of agreement of repurchase against the 
respondent-defendants before trial court. The trial court dismissed the suit 
holding that the document executed in favour of the appellant does not amount 
to transfer of right of repurchase in favour of the appellant but a transfer in 
interest in the property which is invalid since respondents 2 to 4 bad already 
transferred their interest and title in favour of respondent 1. In appeal, the 
G first appellate court upheld the dismissal of the suit by the trial court. Further 
held that the right of repurchase, if any, available to respondent 2 to 4, was a 
personal right which was not assignable or transferable. The High Court 
dismissed the second appeal of the appellant holding that the personal right 
available to respondents 2 to 4 cannot be assigned or transferred in the 
H 
784 
SHY AM SINGH v. DARY AO SINGH (DEAD) BY LRS. 
785 
absence of express prohibition in the agreement for repurchase of the suit A 
property. 
Allowing the appeal and remanding the matter to the trial court, the 
Court 
HELD: 1.1. Reading the agreement for repurchase of the suit property B 
executed in favour of respondents 2 to 4 by respondent 1 as a whole and 
particularly keeping in view the fact that a long period of ten years was fixed 
for obtaining reconveyance, no implied prohibition of transfer or assignment 
can be inferred in the document particularly in view of the provisions under 
section lS(b) of the Specific Relief Act, 1963. Under the terms of the C 
agreement, there is no express prohibition against assignment or transfer of 
the right of repurchase by the original party in favour of the third party. 
[789-C-D; 790-B) 
1.2. Though there is no clear stipulation, both the contracting parties 
would be presumed to have been alive to the legal provisions contained in 
section lS(b) of the Specific Relief Act. The two document-one for sale and D 
the other of repurchase-were executed on the same day. As the sale and 
agreement of repurchase are contained in two separate documents, although 
contemporaneously executed, the transaction cannot be treated a 'mortgage' 
under section 58(c) of the Transfer of Property Act, 1882 but it seems to be 
a transaction akin to a 'mortgage'-ifnot 'mortgage proper'. From the tenor E 
and contents of the two documents contemporaneously executed, it seems that 
respondents 2 to 4 to raise money, sold the property but with a right to 
repurchase on return of the money. (790-D-FJ 
1.3. In the absence of any words or expressions in the documents 
indicating prohibition on assignment or transfer of right of repurchase and F 
in the face of clear provisions of section lS{b) of the Specific Relief Act, 1963, 
an implied prohibition cannot be read into the terms of the document. Merely 
because in the documents, there is mention of 'heirs' of the contracting parties 
but not their 'assignees' or 'transferees', the legal right of assignment 
available to the benefit of original contracting party under section lS

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