Supreme Court of India· 07 August 2026

If the balance sale consideration under a registered sale deed is never paid, can the vendor have the sale deed declared void and cancelled?

Raziya Begum & Ors v. Nafisa Begum Abdul Hamid & Ors

2026 INSC 814 · Civil Appeal No. 7225 of 2011
Coram: K. Vinod Chandran; J. B. Pardiwala

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Answer

No. The Court held that non-payment of the balance consideration does not invalidate a registered sale deed; the vendor's only remedy is a suit to recover the balance consideration with interest, not cancellation of the sale deed or a declaration that it is void.

Headnote

Transfer of Property Act, 1882 — s.54 — Sale — Part payment of consideration — Validity of sale deed — Transfer of Property Act, 1882 — s.54 — Payment of full price not essential — Held: Section 54 does not make payment of the entire price at execution a condition of a completed sale. A sale is valid once the price is paid, promised, or part-paid and part-promised, and the document is registered. (¶10, 12) Transfer of Property Act, 1882 — s.54 — Remedy for unpaid balance — Held further: Non-payment of the balance consideration does not render the sale deed void or invalidate it; the vendor's remedy is a suit to recover the balance with interest, not cancellation of the sale deed or a declaration of its nullity. (¶11, 14) Transfer of Property Act, 1882 — s.54 — Appeal allowed — Held further: The plaintiffs, having never sued to recover the balance, could not seek cancellation instead; the sale accordingly became final. Appeal allowed, the High Court's judgment reversed and the Trial Court's dismissal of the suit restored, the appellants to pay the outstanding balance with interest from 10.03.1975. (¶14, 17)

In the Court's own words

Paragraph 11Dahiben (supra) also, while interpreting Section 54 of the Act, held that actual payment of entire sale price at the time of execution of sale deed is not an essential condition for completion of sale. When a sale deed is registered, even upon part payment of the sale price, title would pass to the transferee. The non- payment of remaining part of the sale price would not invalidate it and the remedy would be to recover the balance sale consideration, but not cancellation of sale deed for non-payment of balance sale consideration.

Paragraph 14Even if we understand the High Court having not entered into a reappreciation of facts, it is clear that the conclusion on the available facts was wrong. The sale deed executed with full knowledge of the part consideration alone having been passed, cannot be rendered void or inoperative merely because the balance consideration promised to be paid, which promise was incorporated in the sale deed, had not been complied with. The right of the plaintiffs was to file for recovery of balance sale consideration and not to seek declaration that the sale deeds were null and void; which they are not.

Acts & Sections

s.54 Transfer of Property Act, 1882s.100 Code of Civil Procedure, 1908

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Also decided in this judgment

Under Section 54 of the Transfer of Property Act, 1882, is payment of the entire sale price at the time of execution necessary for a sale to be validly completed?

Plain-language answer prepared by the LexStreak Editorial Desk — verify against the judgment. Source: Supreme Court of India. Corrections