Doctrine of Lis Pendens (Section 52)

Once a suit relating to immovable property has been filed and is pending, no party may transfer or otherwise deal with the property in a manner that would defeat the rights of the other party under the decree the court eventually passes. Section 52 of the Transfer of Property Act, 1882 codifies that rule, which the common law had long known by the maxim pendente lite nihil innovetur — pending the suit, nothing should be changed. The transfer is not void; it is good as between the transferor and the transferee. But it is subordinated to whatever the court eventually decrees, and the transferee takes subject to the litigation.

The maxim and the policy

The Supreme Court in Amit Kumar Shah v Farida Khatoon, AIR 2005 SC 2209 / (2005) 11 SCC 403, traced the rule to pendente lite nihil innovetur. The classic exposition is from Turner LJ in Bellamy v Sabine — it is a doctrine common to both law and equity, and rests on the foundation that no action could be brought to a successful termination if alienations pendente lite were permitted to prevail. The plaintiff would be liable in every case to be defeated by the defendant's alienating before judgment, and would be driven to begin his proceedings de novo, only to be defeated again by the same course of conduct.

The doctrine is therefore one of necessity, not of notice. Lord Cranworth in Bellamy v Sabine said it was scarcely correct to speak of lis pendens as affecting a purchaser through the doctrine of notice — the law does not allow litigating parties to give to others, pending the litigation, rights to the property in dispute, so as to prejudice the opposite party. The Privy Council adopted that reasoning in Faiyaz Husain Khan v Prag Narain, (1907) ILR 29 All 339 / 34 IA 142, the leading Indian case. The rule rests on the necessity for final adjudication; it is immaterial whether the alienee pendente lite had, or had not, notice of the pending proceeding.

Statutory anchor — Section 52 in full

Five ingredients of Section 52

The section operates only when each of the following conditions is satisfied. The absence of any one defeats its application.

1. A suit or proceeding is pending. The Explanation supplies a precise rule on commencement and conclusion. Pendency begins on presentation of the plaint or institution of the proceeding in a court of competent jurisdiction. It continues until final decree or order, plus complete satisfaction or discharge — or until execution becomes unobtainable by reason of limitation.
2. The court has authority. Within India (excluding the erstwhile State of Jammu and Kashmir), or in courts established beyond India by the Central Government. A court without inherent jurisdiction — one that lacks the power to entertain the dispute under the basic scheme of jurisdictional rules — does not satisfy this requirement.
3. The suit is not collusive. Collusive proceedings are excluded. The substitute for the older language "contentious suit" is the negative formula "not collusive" — a change of phrasing without change of substance.
4. A right to immovable property is directly and specifically in question. The dispute must be about the immovable property itself, not about something incidental to it. A suit for a money decree that incidentally touches a property is outside the section.
5. The property is transferred or otherwise dealt with by a party to the suit. The transfer must be by a party who is competent to transfer; transfers by strangers to the proceeding fall outside the section. The transferor's act must be one that would, if recognised, affect the rights of any other party under the decree.

Pendency — when it begins, when it ends

Pendency begins on presentation of the plaint or institution of the proceeding in a court of competent jurisdiction. The Explanation makes it clear that the date of presentation in a court that lacks jurisdiction does not count. If a plaint is rejected and re-presented in a competent court, an alienation between the two presentations is not subjected to lis pendens. The Madras High Court applied this in Shakila Banu v Kathija, (2022) 8 MLJ 513.

An appeal or execution proceeding is a continuation of the suit, and lis pendens continues during the appeal or execution. The Supreme Court so held in Ghantsher Ghosh v Madan Mohan Ghosh, AIR 1997 SC 471 / (1996) 11 SCC 446 — the legislature thought it fit to extend the scope of "suit" to cover execution proceedings with decrees passed in such suits. Pendency continues till satisfaction or until execution is barred by limitation. The Supreme Court in Jagan Singh v Dhanwanti, (2012) 2 SCC 628, held that the period continues till the expiration of the period of limitation prescribed for filing an appeal.

Specific applications: a suit for sale on a mortgage is pending after the preliminary decree for sale, and continues until the security is realised for the satisfaction of the judgment-creditor. A suit for foreclosure is pending until the decree is absolute. A suit to enforce a mortgage by sale continues after the decree nisi for sale, and a purchaser, lessee or subsequent mortgagee after a preliminary decree for sale takes subject to the rights of the auction-purchaser at the execution sale. The Supreme Court in Supreme Court Films Exchange Ltd v HH Maharaja Sir Srinath Singhji Deo, (1975) 2 SCC 530 / AIR 1975 SC 1810, applied the principle to a lease executed during attachment of a theatre.

The right must be "directly and specifically" in question

The doctrine requires that a right to immovable property be directly and specifically in question in the suit. Suits for a personal money decree do not satisfy the requirement, even if the defendant is a property owner whose property is later attached. Suits for maintenance, where a charge on property is sought, fall within the section if the charge claimed is on a specific property; a creditor's general suit against the heirs of a deceased debtor does not meet the requirement unless the suit specifically engages a particular property.

Specific suits routinely held to attract the section include suits for specific performance of a contract for sale of immovable property; suits on a mortgage; suits for partition; suits for pre-emption; suits on rent that engage the lessor's reversion; and suits asserting an easement over identified property. Conversely, suits that decide only personal rights, suits for an unliquidated money decree, and award proceedings that do not directly engage immovable property are outside the section.

Even where the suit decides primarily a personal right, if the personal right depends upon ownership of a specific immovable property — a charge for maintenance, a right of redemption, a covenant of pre-emption that has been argued to create an interest — the section may apply. The classic line is drawn between cases where the immovable property is the subject-matter of the dispute (within the section) and cases where it is merely the source from which a personal claim might be satisfied (outside the section).

The suit must not be collusive

The section is taken outside its scope only where the suit is collusive. A collusive suit, the Supreme Court has held, differs from a fraudulent suit. In a collusive proceeding the claim put forward is fictitious, the contest over it unreal, and the decree is a mere mask having the similitude of a judicial determination, worn by the parties to confound third parties. A fraudulent suit, by contrast, is one in which the claim is untrue but the claimant has obtained the verdict by practising fraud on the court — fraudulent suits are real combats; collusive ones are sham combats.

Where the parties to a suit entered into an agreement for the express purpose of defeating a transferee's rights and obtained a decree in terms of the agreement, the rule of lis pendens does not apply — the suit is collusive and is outside the section. But the mere fact that a suit results in a consent decree is no bar to the application of the doctrine. The Madras High Court captured the distinction in Annamalai Chettiar v Malayandi, (1906) ILR 29 Mad 426 — unless a compromise is collusive, the very fact that there is a compromise shows that the suit was, in its origin and nature, contentious.

It is settled, in the absence of fraud or collusion, that the doctrine of lis pendens applies to a suit decided ex parte. Krishnappa v Shivappa, (1907) ILR 31 Bom 393, settled this. The combat is real even when one side does not turn up; the section does not require both sides to fight the action.

Effect on the transferee — voidable, not void

Section 52 does not annul the transfer. The transfer is good as between the parties and operates to vest the title of the transferor in the transferee — it is merely subordinated to the rights eventually decreed in the suit. The Supreme Court in Nagubai Ammal v B Shama Rao, AIR 1956 SC 593 / [1956] 1 SCR 451, made the position clear — the effect of Section 52 is not to wipe out the transfer altogether, but to subordinate it to the rights based on the decree in the suit. Transfers pendente lite have therefore been held valid and operative as between the parties to the transaction.

The transferee pendente lite is, in the words of Khemchand Shankar Choudhari v Vishnu Hari Patil, (1983) 1 SCC 18, a representative-in-interest of the transferor — a person bound by the decree even though he was not made a party to the suit. The transferee may not raise the defence of being a bona fide purchaser for value without notice. Section 52 is a rule of public policy; the question of good faith does not arise. The doctrine forbids transfer of rights in a third party during the pendency of litigation, and the sale is rendered subservient to the decree even if the purchaser was unaware of the litigation.

The Supreme Court summarised the reach of the section in G T Girish v Y Subba Raju, 2022 SCC OnLine SC 60 — the cardinal and indispensable requirement is that the transfer or dealing with the property which is the subject-matter of the proceeding must be carried out by a party to the proceeding. The embargo on transfer is intertwined with the beneficiary of the veto being any other party to the proceeding. Lis pendens can be used both as a sword and as a shield, depending on the right or interest transferred, who the affected party is, and how the transfer is likely to affect any party to the pending proceeding.

Co-defendants and "any other party"

The party whose rights are affected must be a party between whom and the alienating party there is an issue for decision. As in res judicata, the rule of lis pendens will not apply between co-defendants unless the relief claimed in the suit involves a decision between them. A simple way to see this — the section protects "any other party" from being defeated by an alienation, but only where there is an issue between the alienator and that other party. If two defendants make common cause against the plaintiff, and there is no issue between them, an alienation by one does not affect the other under the rule.

A party whose name has been struck off the suit by consent is not bound by the decree, actually or constructively, and is not, therefore, affected by the doctrine. The Supreme Court in Maqbool Alam Khan v Mst Khoderija, [1966] 3 SCR 479 / AIR 1966 SC 1194, applied this rule. The plea of lis pendens cannot, however, be availed of by the person who himself transfers the property pendente lite — he cannot use his own breach of the rule as a shield.

The Supreme Court in Bengal Ambuja Housing Development Ltd v Pramila Sanfui, AIR 2015 SC 3729, drew a related line — a temporary injunction can be granted against only the parties to the suit, and therefore the sale of suit property by persons who are not parties (such as their heirs or strangers) is not hit by Section 52. The section reaches the parties to the suit and their representatives-in-interest; it does not reach independent strangers.

Maharashtra and Gujarat — the registration requirement

The Bombay (Amendment) Act, 1939, altered Section 52 in its application to immovable property situated in what was then the Bombay Presidency, requiring that a notice of the pendency of the suit be registered under Section 18 of the Indian Registration Act, 1908. The amendment was declared by Bombay Act 57 of 1959 to be in force in the whole of the then State of Bombay, and is therefore in force in the present-day States of Gujarat and Maharashtra. In those notified areas, the doctrine of lis pendens operates only if a notice of the lis is registered in the prescribed manner.

The Supreme Court applied the amendment in Sunil D Chedda v Suresh Babulal Seth, AIR 1992 SC 1200 / 1993 Supp (1) SCC 323 — in notified areas, the rule of lis pendens under Section 52 will operate only provided the lis is registered as the local amendment requires. The state amendment converts the doctrine, in those areas, into a species of constructive notice; outside those areas, the original Section 52 operates without any registration requirement and on the basis of necessity rather than notice.

The amended provision has its own list of mandatory particulars — name and address of the property owner, description of the property, the court in which the suit is pending, the nature and title of the suit, and the date of institution. A failure to register the notice in compliance with the local rule means that lis pendens does not apply in those areas, and the transferee takes free of the doctrine.

Lis pendens and temporary injunctions

Section 52 and Order XXXIX of the Code of Civil Procedure, 1908, operate in different spheres. The doctrine of lis pendens does not in terms prohibit a transfer; it merely subordinates the transfer to the eventual decree. A temporary injunction under Order XXXIX, by contrast, operates as a restraint — a breach exposes the party to attachment of property, civil imprisonment, dismissal of suit, striking off of defence, and contempt of court. The two remedies have different deterrent effects and may both be sought in appropriate cases.

In Kachhi Properties, Satara v Ganpatrao Shankarao Kadam, AIR 2011 (NOC) 185 (Bom), the Bombay High Court refused a temporary injunction on the ground that Section 52 provided adequate protection — the occasion for invoking Order XXXIX rules 1 and 2 arises only in rare cases where the plaintiff demonstrates that the rule of lis pendens is inadequate. The Andhra Pradesh High Court in K Ravi Prasad Reddy v G Giridhar, AIR 2022 AP 59, similarly held that lis pendens does not operate as a bar to the grant of injunction where injunctive relief is otherwise warranted.

The deterrent strength of the two remedies differs, and the Bombay High Court in Prakash Gobindram Ahuja v Ganesh Pandharinath Dhonde, 2016 (6) ABR 745, held that registration of notice of pending suit, though desirable, cannot replace an order of injunction where the deterrent effect of the latter is required to prevent multiple subsequent dealings.

Lis pendens, Section 41 and Section 19 of the Specific Relief Act

A transferee pendente lite cannot seek the protection of Section 41 of the Act, since he cannot be regarded as a bona fide transferee from an ostensible owner without notice. The two doctrines exclude each other — Section 41 protects only those who deal with an ostensible owner without notice; Section 52 imputes notice to every transferee from a party to a pending suit, regardless of actual knowledge. An estoppel under Section 41 cannot therefore override the provisions of Section 52.

Section 19 of the Specific Relief Act, 1963, provides that specific performance may be enforced against a subsequent transferee for value who has paid the price in good faith and without notice of the original contract. Even there, the doctrine of lis pendens bites — a transferee who takes during the pendency of a suit for specific performance is not protected, because Section 52 prevents him from defeating the original contract-purchaser's rights under the eventual decree. The Madras High Court applied this in Kurra Murali Krishna Yadav v Sri Lakshmi Rama Cooperative Building Society Ltd, (2022) 2 ALT 516.

The interaction with the principle of res judicata, drawn from the Code of Civil Procedure, is similar. Once a judgment is pronounced by a competent court in regard to the subject-matter of the suit in which the doctrine of lis pendens applies, the decision binds not only the parties but also the transferee pendente lite — the rule of res judicata reinforces the rule of lis pendens. If the earlier suit was dismissed for default and no issue was decided, neither doctrine applies; the Madras High Court so held in Marakkal v S G Kannappan, (2017) 3 MLJ 379.

Pitfalls and exam angles

The first pitfall is to think that lis pendens requires notice. It does not. The rule rests on necessity, not on notice — Lord Cranworth's exposition in Bellamy v Sabine is the foundation. The transferee's actual knowledge or ignorance of the pending suit is irrelevant outside the notified areas of Maharashtra and Gujarat.

The second pitfall is to think that lis pendens renders the transfer void. It does not. The transfer is good as between the parties to it; the section merely subordinates the transfer to the rights eventually decreed. Nagubai Ammal v B Shama Rao is the leading authority, and the Supreme Court has repeatedly affirmed the position.

The third pitfall is to apply the section to suits that do not directly engage immovable property. A money suit, a personal-rights suit, an award proceeding that does not specifically claim a right to a particular immovable property — none of these falls within Section 52. The right to immovable property must be directly and specifically in question; the section is express on that requirement.

The fourth pitfall is to forget the Maharashtra-Gujarat amendment. In notified areas of those two States, the doctrine operates only if a notice of lis is duly registered. Outside the notified areas, the original Section 52 applies without registration. Sunil D Chedda v Suresh Babulal Seth is the standard authority.

The fifth pitfall is to confuse lis pendens with the rule against fraudulent transfers in Section 53. The two doctrines protect creditors from different mischiefs. Section 52 protects parties to a pending suit; Section 53 protects creditors generally. The two may overlap on facts but they have different ingredients and different remedies.

A final caution — the section applies to both sales and to all other modes of transfer or dealing — mortgages, leases, gifts, settlements, surrenders, releases, and any creation of a charge. The phrase "transferred or otherwise dealt with" is wider than mere transfer; the Supreme Court has applied it to wrongful constructions during the pendency of execution, to the assignment of a decree, to the creation of a tenancy, and to an attachment-defeating sale. The doctrine reaches the conduct, not merely the legal form, and the litigant who tries to circumvent the rule by dressing his transfer in another name will find the section bites all the same.