Bhola Paik vs. The State of West Bengal & Ors. - We however clarify that if at any stage to be effected by any sale or creation of third party right made by the appellant herein the same shall be subject to the result of the suits filed by the appellant herein as well as respondent Nos.5 and 6 herein.

 SCI (2026.10.26) in Bhola Paik vs. The State of West Bengal & Ors.   [Civil Appeal No. ……. (@SLP(C)  No(s). 27629/2023)] held that; 

• We however clarify that if at any stage to be effected by any sale or creation of third party right made by the appellant herein the same shall be subject to the result of the suits filed by the appellant herein as well as respondent Nos.5 and 6 herein.

• The appellant shall also indicate in the sale agreement/sale deed to be executed in favour of third parties about the pendency of the suits between the parties.

Blogger’s Comments; Mr. A. Santhil Kumar in his post in LinkedIn has identified following  major takeaways;

Subject to Lis Pendens: Under Section 52 of the Transfer of Property Act, 1882, any transfer or sale of property during ongoing litigation is bound by the eventual result of the suit.

Mandatory Disclosure to Buyers: Developers and sellers must explicitly state and disclose the pendency of the litigation directly inside the sale agreements or sale deeds executed with third-party buyers.

No Obstruction of Decrees: As affirmed in related jurisprudence like Alka Shrirang Chavan vs. Hemchandra Rajaram Bhonsale (Supreme Court Case Details), buyers who purchase property during a pending suit (transferees pendente lite) cannot use their purchase to resist or obstruct the execution of a court decree if the seller loses the case 

Excerpts of the order;

Leave granted.

# 2. We have heard learned counsel for the appellant and learned senior counsel for respondent Nos.5 and 6 and learned counsel for respondent Nos.2 to 4 and learned counsel for the first respondent-State.

# 3. Learned counsel for the appellant submitted that the direction contained in paragraph 14 of the impugned order is causing prejudice to the appellant inasmuch as the construction has been completed and the flats are ready for sale. However, the direction not to create any third party interest or transfer is not in accordance with law in asmuch as Section 52 of the Transfer of Property Act, 1882 enables a sale to be effected of the disputed property subject to the result of the suit. She further submitted that this Court may grant the said permission instead of the Trial Court granting permission to effect the same and grant leave to effect third party interest. She further submitted that as a result of the direction in paragraph 14 of the impugned order, the suit is moving at a snail’s pace and respondent-defendant Nos.5 and 6 in the suit are seeking adjournments. Further, the very same respondent Nos.5 and 6 have also filed a separate suit which is also clubbed with the suit filed by the appellant herein. Hence, the embargo on creation of third party interest may be removed.

# 4. Learned senior counsel appearing for respondent Nos.5 and 6 as well as learned counsel for the other respondents have however supported the impugned order and they contended that when there is a dispute concerning title, the appellant cannot be permitted to create third party interest. Hence, there is no merit in this appeal.

# 5. We have considered the arguments advanced at the bar and we have noted the fact that the appellant herein has already  completed the construction and there are also third parties who were ready and willing to purchase the flats constructed by the appellant herein subject to the result of the suit and the risk involved therein.

# 6. In the circumstances, paragraph 14 of the impugned order which reads as under, is set aside:

• “14.The appellant is at liberty to carry on with the construction work in accordance with the previously sanctioned plan subject to the conditions that he or his agents, partners and any other person under him shall not use the property, nor create any third party interest in respect of the same, nor transfer the said property in any manner whatsoever without the leave of the competent Civil Court of law. However, the appellant will be at liberty to undertake regular maintenance work if the same is required, to keep the building in a proper condition.”

# 7. We however clarify that if at any stage to be effected by any sale or creation of third party right made by the appellant herein the same shall be subject to the result of the suits filed by the appellant herein as well as respondent Nos.5 and 6 herein. 

# 8. The appeal is allowed in the aforesaid terms.

# 9. As the suits are pending since the year 2022, we request the concerned Trial Court to dispose of the suit as expeditiously as possible, obviously with the cooperation of the parties.

# 10. The appellant shall also indicate in the sale agreement/sale deed to be executed in favour of third parties about the pendency of the suits between the parties.

# 11. Pending application(s), if any, shall stand disposed of.

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