Allowing an appeal in Sharadamma v Mohammed Pyrejan (Deceased) through Legal Representives & Anr, the Supreme Court recently held that an assignor or seller does not lose his or her interest in an ongoing suit merely as a result of the assignment or release of the rights to the property in question.
In 1998, Sharadamma had unsuccessfully filed a suit before a trial court in Karnataka, for the purpose of declaration of title and for restoration of possession on the strength of a registered sale deed of a property dated 10 November 1965. She had also claimed a sum of ₹3,000 towards past damages and a further sum of ₹20 per day as continuing damages.
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Sharadamma filed an appeal against the trial court’s dismissal of the suit before Karnataka High Court. In 2011 while waiting for the high court to rule on her appeal, Sharadamma released her interest in the property in favour of her daughter who in turn transferred it through a sale deed. In 2013, Karnataka High Court dismissed the appeal on the ground that Sharadamma had lost her right to continue the appeal as she had released her interest in the property.
Referring to past judgments, the court stated that a suit or appeal cannot be dismissed on account of the failure of an assignee to file an application to continue the proceedings. It would be open to the assignor to continue the proceedings notwithstanding the fact that he or she ceased to have any interest in the subject-matter of the dispute. The assignor can continue the proceedings for the benefit of assignee.
Holding that the order passed by Karnataka High Court was “patently illegal”, the Supreme Court set aside the order. The Supreme Court then remitted the matter to Karnataka High Court to decide afresh.
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The dispute digest is compiled by Bhasin & Co, Advocates, a corporate law firm based in New Delhi. The authors can be contacted at lbhasin@bhasinco.in or lbhasin@gmail.com. Readers should not act on the basis of this information without seeking professional legal advice.
