Delhi High Court Grants Permanent Injunction in Property Dispute, Dismisses Time-Barred Counterclaim Challenging 2006 Sale Deed, and Reaffirms That Mutation Does Not Determine Ownership

Court’s Decision:

The court granted a permanent injunction in favor of the plaintiff, meaning the defendant was legally restrained from interfering with the plaintiff’s possession of the suit property. Additionally, the counterclaim filed by the defendant, which sought cancellation of the sale deed, was dismissed as it was filed beyond the limitation period prescribed under Article 59 of the Limitation Act, 1963.

Facts:

• The plaintiff purchased the disputed land through a registered sale deed dated October 27, 2006 and had been in peaceful possession ever since.
• The defendant, who was the original owner (Bhumidar), later claimed that the sale violated the Delhi Land Reforms Act, 1954 (DLRA) and attempted to reclaim the land.
• The plaintiff had obtained a mutation order in 2014, transferring the property in revenue records, but the defendant objected, leading to ongoing legal proceedings.
• The defendant attempted to forcefully enter the property in August 2021, prompting the plaintiff to file the current lawsuit for an injunction.
• The defendant also filed a counterclaim in February 2024, seeking cancellation of the sale deed.

Issues Before the Court:

1. Whether the plaintiff had lawful possession and was entitled to an injunction against the defendant.
2. Whether the 2006 sale deed was valid, considering the alleged violations of Sections 33 & 42 of the DLRA.
3. Whether the defendant’s counterclaim for cancellation of the sale deed was barred by limitation.
4. Whether the mutation order and revenue records had any bearing on the ownership dispute.

Petitioner’s (Plaintiff’s) Arguments:

1. Sale deed is legally valid – The defendant himself executed the registered sale deed in 2006, and he cannot now dispute its validity.
2. Possession was lawfully transferred – As per the terms of the sale deed, physical possession of the property was handed over at the time of sale.
3. Defendant’s objections were inconsistent – The defendant had earlier admitted to selling the land in mutation proceedings but later started claiming that possession remained with him.
4. The counterclaim is time-barred – Under Article 59 of the Limitation Act, 1963, a suit to cancel a document must be filed within three years from the date of knowledge of fraud or mistake. The defendant waited 18 years (from 2006 to 2024) to challenge the sale, which is far beyond the limitation period.
5. Mutation does not affect ownership – As per Supreme Court precedents, mutation entries in revenue records do not create or extinguish ownership rights.

Respondent’s (Defendant’s) Arguments:

1. Sale was void under Sections 33 & 42 of the DLRA – Since the defendant was a Bhumidar, he was legally prohibited from selling agricultural land under the DLRA.
2. The sale agreement was incomplete – The defendant claimed that the sale was supposed to include another parcel of land, which was never transferred.
3. Possession was never transferred – The defendant argued that revenue records (Khasra Girdawari) continued to show his name, proving that he retained possession.
4. Financial Commissioner’s order is relevant – The defendant referred to ongoing mutation disputes before the Financial Commissioner, arguing that these disputes cast doubt on the validity of the sale.
5. Plaintiff cannot claim ownership via injunction – Since the plaintiff had not filed a suit for declaration of ownership, he could not rely on an injunction suit alone.

Analysis of the Law:

1. Sale Deed Validity & Sections 91 & 92 of the Evidence Act

• The sale deed was a registered document, meaning the defendant cannot introduce oral evidence to contradict it.
• Precedent: S. Saktivel v. M. Venugopal Pillai (2000) 7 SCC 104 – A registered sale deed cannot be altered or challenged through oral agreements.
• The defendant had already admitted to executing the sale in prior proceedings, which further weakened his case.

2. Effect of Mutation on Ownership

• Mutation is only for revenue purposes; it does not confer ownership rights.
• Precedent: Sawarni v. Inder Kaur (1996) 6 SCC 223 – Mutation does not create or extinguish title; it is merely an administrative procedure for tax collection.
• The Financial Commissioner’s order only directed the SDM to reconsider the mutation but did not affect the plaintiff’s possession.

3. Limitation & Counterclaim Dismissal

• Under Article 59 of the Limitation Act, 1963, a suit to cancel a sale deed must be filed within three years.
• The defendant had been aware of the sale since 2006 and had already raised objections in 2014. The 2024 counterclaim was 14 years too late.
• Precedent: Prem Singh v. Birbal (2006) 5 SCC 353 – A registered sale deed carries a presumption of validity, and a challenge must be made within the limitation period.

4. Effect of DLRA on Transfer

• Even if the sale violated Section 33 of the DLRA, the land would revert to the Gaon Sabha, not to the defendant.
• Precedent: Anathula Sudhakar v. P. Buchi Reddy (2008) 4 SCC 594 – In injunction suits, the key question is possession, not title.

Court’s Reasoning:

1. Defendant admitted to executing the sale deed, meaning he cannot now argue that it was invalid.
2. Possession was transferred at the time of sale – This was explicitly mentioned in the registered sale deed.
3. Defendant’s reliance on mutation was misplaced – Mutation does not affect ownership or possession.
4. DLRA provisions do not benefit the defendant – Even if the sale was void, he would not regain possession; the land would go to the Gaon Sabha.
5. The counterclaim was time-barred – A claim to cancel the sale had to be made within three years (by 2009 at the latest), making the 2024 counterclaim invalid.

Conclusion:

• Plaintiff’s permanent injunction was granted – The defendant cannot interfere with the plaintiff’s possession.
• Defendant’s counterclaim was dismissed as time-barred.
• The court reaffirmed that mutation does not impact ownership and that the DLRA does not allow the defendant to reclaim the property.

Implications of the Judgment:

1. Confirms that possession under a registered sale deed is legally protected.
2. Reiterates that mutation is only for tax purposes and does not determine ownership.
3. Strengthens the principle that sale deed challenges must be made within the limitation period.
4. Clarifies that DLRA violations do not give previous owners the right to reclaim land.
5. Sets a precedent for similar property disputes in Delhi involving DLRA provisions.

Also Read – Delhi High Court Dismisses Plea Against Dispossession of Alleged Encroached Land on Yamuna Floodplain: “Revenue Records Do Not Confer Title; Encroachers Cannot Claim Ownership Over Public Land”