Delhi High Court Directs Seller to Deposit ₹20.5 Crore After Subsequent Sale of Property During Specific Performance Dispute
Delhi High Court Protects Buyer’s Rights in Specific Performance Suit, Orders Status Quo on GK Properties and Directs Seller to Deposit ₹20.5 Crore Sale Consideration
Facts
The Delhi High Court decided interim applications in two connected civil suits concerning properties situated at Greater Kailash-I and Greater Kailash Enclave-II, New Delhi.
In CS(OS) 626/2025, Romi Garg sought specific performance of an Agreement to Sell dated 15 May 2023 allegedly executed by his mother, Sheela Devi, in respect of the GK-I property and basement, ground floor and first floor of the GK-II property for a total consideration of ₹24.50 crore.
Romi Garg claimed that he had already paid ₹23.16 crore out of the total consideration and was ready and willing to pay the remaining ₹1.34 crore. He also claimed that the original title documents of the GK-II property were handed over to him and that he had spent about ₹7.85 crore on construction through Ecogreen.
In CS(OS) 394/2025, White Paper Design Private Limited sought specific performance of a later Agreement to Sell dated 22 July 2024 executed by Romi Garg in its favour for the first floor of the GK-II property for ₹6.25 crore.
During the pendency of the suits, Sheela Devi sold the basement and ground floor of the GK-II property to KIOSK Properties Private Limited for ₹12 crore and the first floor to Bhilai Engineering Industries Limited for ₹8.5 crore. The Court noted that these sales were not disclosed when the matter was first taken up.
Issues
- Whether Romi Garg had made out a prima facie case for interim protection in his suit for specific performance against Sheela Devi.
- Whether White Paper Design Private Limited had made out a prima facie case for protection of its rights under the Agreement to Sell dated 22 July 2024.
- Whether the sale deeds executed by Sheela Devi in favour of KIOSK Properties and Bhilai Engineering during the pendency of the dispute could defeat the earlier contractual rights claimed by Romi Garg and White Paper Design.
- Whether the subsequent purchasers could be treated as bona fide purchasers for value without notice.
- Whether Sheela Devi should be directed to deposit the ₹20.5 crore received from the subsequent purchasers.
Petitioner’s Arguments
Romi Garg argued that Sheela Devi had agreed to sell both suit properties to him under the Agreement to Sell dated 15 May 2023 and that he had paid ₹23.16 crore out of ₹24.50 crore. He submitted that he was always ready and willing to pay the balance amount of ₹1.34 crore.
He further argued that Sheela Devi had handed over the original title deeds of the GK-II property to him and that he had undertaken construction on the suit properties through Ecogreen, spending approximately ₹7.85 crore.
Romi Garg contended that the allegation of forgery raised by Sheela Devi and Anup Garg was false. He relied on the affidavit of his father, Telu Ram, who had witnessed the Agreement to Sell and identified Sheela Devi’s signatures.
He also argued that Sheela Devi acted dishonestly by selling the GK-II property to subsequent purchasers despite having already received substantial consideration from him.
White Paper Design argued that it had a valid Agreement to Sell dated 22 July 2024 in respect of the first floor of the GK-II property and had already paid ₹3.37 crore. It submitted that it was ready and willing to pay the balance amount and had even prepared a demand draft.
White Paper Design further argued that the sale deeds in favour of Bhilai Engineering and KIOSK Properties were subsequent transactions and were subject to the earlier rights created under the Agreements to Sell.
Respondent’s Arguments
Sheela Devi and Anup Garg argued that the Agreement to Sell dated 15 May 2023 was forged and fabricated. They claimed that Sheela Devi’s signatures were forged and that Romi Garg had failed to produce the original agreement.
They also argued that the payments relied upon by Romi Garg were not payments towards the Agreement to Sell, but were merely internal family or business transactions, with money allegedly being moved in and out of Sheela Devi’s account.
They further contended that White Paper Design was controlled by Romi Garg and that its suit was collusive and filed only to create false third-party rights.
KIOSK Properties and Bhilai Engineering argued that they were bona fide purchasers who had paid valuable consideration and had purchased the property after due diligence. They submitted that they were unnecessarily dragged into a family dispute and that they had no notice of the alleged earlier Agreement to Sell dated 15 May 2023.
They also claimed that earlier Agreements to Sell had been executed in their favour by Sheela Devi and that the sale deeds dated 1 September 2025 were valid transactions.
Analysis of the Law
The Court applied the settled principles governing grant of temporary injunction under Order XXXIX Rules 1 and 2 of the Code of Civil Procedure, 1908, namely:
- prima facie case;
- balance of convenience; and
- irreparable injury.
The Court also considered the nature of a suit for specific performance, where readiness and willingness of the plaintiff to perform the contract is a relevant factor.
On a prima facie assessment, the Court found that Romi Garg had shown substantial payment of consideration, possession of original title documents, and readiness and willingness to pay the balance amount.
The Court also considered the effect of subsequent sale deeds executed during the pendency of litigation. Since the sale deeds were executed after the earlier Agreements to Sell and after disputes had already arisen, the Court held that the subsequent transactions could not, at the interim stage, be allowed to defeat the rights claimed by Romi Garg and White Paper Design.
Precedent Analysis
The judgment does not turn on an elaborate discussion of case law. Instead, it applies well-established principles of interim injunctions and specific performance.
The Court relied on the prima facie enforceability of the earlier Agreements to Sell, the plaintiff’s readiness and willingness, and the need to preserve the suit property during litigation.
The Court also accepted the broad principle underlying priority of earlier rights, noting that subsequent sale deeds would remain subject to the rights created in favour of Romi Garg and White Paper Design under the earlier Agreements to Sell.
Court’s Reasoning
The Court found that the genuineness of the Agreement to Sell dated 15 May 2023 could only be finally determined at trial. However, at the interim stage, the Court found several factors supporting Romi Garg’s case.
First, Romi Garg had placed material showing payment of ₹23.16 crore to Sheela Devi. Second, the original title documents of the GK-II property were stated to be in Romi Garg’s possession. Third, the Court found that Romi Garg had demonstrated readiness and willingness to pay the remaining ₹1.34 crore.
The Court also rejected, at the prima facie stage, the argument that irregularities in the stamp paper automatically made the Agreement to Sell forged or invalid.
Regarding the sale deeds dated 1 September 2025 executed in favour of KIOSK Properties and Bhilai Engineering, the Court found several suspicious circumstances. The sale deeds were executed shortly after mediation failed, they were not disclosed to the Court when the matter came up, and they contained statements which appeared contrary to the record.
The Court also noted that the sale deeds stated that Sheela Devi had constructed the property through Anup Garg with her own funds, whereas the record indicated that construction was being carried out by Romi Garg through Ecogreen.
The Court further observed that the sale deeds stated that possession had been handed over to the subsequent purchasers, though an earlier statement before the Court indicated that Sheela Devi and Anup Garg were in possession.
The Court held that, on a prima facie view, KIOSK Properties and Bhilai Engineering could not be treated as purchasers for value in good faith without notice of the earlier rights.
The Court also found that Sheela Devi appeared to have received consideration twice in relation to the GK-II property: first from Romi Garg and later from the subsequent purchasers. Therefore, to protect all parties, the Court directed Sheela Devi to deposit ₹20.5 crore in Court.
Conclusion
The Delhi High Court held that Romi Garg and White Paper Design had made out a prima facie case for interim protection.
The Court directed that status quo regarding title and possession be maintained in respect of the basement, ground floor and first floor of the GK-II property till final disposal of the suits.
The Court also directed status quo regarding title and possession of the GK-I property.
Further, Sheela Devi was directed to deposit ₹20.5 crore, being the sale consideration received from KIOSK Properties and Bhilai Engineering, within four weeks. The amount, once deposited, was directed to be kept in an interest-bearing deposit.
The Court clarified that all observations were only prima facie and would not affect the final outcome of the suits.
Case Details
Case: White Paper Design Private Limited through Mr. Abhishek Bansal, Director v. Mr. Romi Garg & Ors.; and Mr. Romi Garg v. Mrs. Sheela Devi & Ors.
Court: Delhi High Court
Case Number: CS(OS) 394/2025 and CS(OS) 626/2025
Judge: Justice Amit Bansal
Date: 6 July 2026
Result: Interim injunction granted; status quo directed over suit properties; Sheela Devi directed to deposit ₹20.5 crore in Court.
