If there is stay for selling of the said stop in form of lis pendent then you can't sell the shop
Consequences of a sale of a shop on a plot where the other half of the plot is pending in court
Hello all! We had a plot on which we constructed two commercial shops. These 2 shops along with other shops next to our shops were built in front of a residential building, when these shops were constructed the trustee/builder filed a case stating that the ownership should be given to existing tenants and not owners of the shop. The judgement came in our favor and other owners, now we are the owners of that plot (only 2 shops). Those 2 shops were rented out and after some years these 2 shops were let out to some parties and eventually both were sold to different buyers without our consent. After years of fighting the case we won the 1st case and the 1st shop is in our possession now and the 2nd case is going on in the small causes court. As I had mentioned earlier it was built in front of the building and next to that building a redevelopment plan is in progress and due to the political pressures, the shops in that lane has been served a road cutting notice from the authorities. As the 2nd case (for 2nd shop) is still in process and the tenant has already submitted the nominal rent in the court in the beginning of the case. Does this mean that the case is mostly in our favor? And the 1st shop has a buyer, should we sell the 1st shop or should we wait for the 2nd shop’s judgment? My dad keeps saying to me that the plot had only one bill or one rent receipt from the original owner/landlord/trustee and if we sell the 1st shop, the 2nd shop’s case might go out of our hands. Would any document or the judgement relevant to the 1st shop would be of utmost important in the 2nd shop’s case, if the 1st shop is being sold right now?
Asked 6 years ago in Property Law
Religion: Muslim
14 answers received from multiple lawyers
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14 Answers
Case should be in your favour
2) first shop can be sold
3) facts of case are identical. Judgment would be relevant to your case
1. if there is some stay on the sale of the 1st shop then you can't sell, else, yes you can sell,
2. case seems to be in your favour as the facts are almost same as per the 1st case
1. The pendency of the case of payment of rent alone does not cause any favour in your side.
2. Selling a property depends squarely on your discretion.
3. If you have a sale deed in your name in respect of the 2nd shop then there is no way selling the 1st shop would adversely impact the merit of the suit for the 2nd shop.
4. Judgments vary as per the peculiar fact situation of each case.
No impact on secodn shop case. First shop ownership is clear by order of court and selling won`t impact your ownership in 2nd shop.
1. You can sell first shop whose judgement came in your favour.
2. Selling of one part will not impact the case on second part.
Since the matter is pending in the court but the court has not granted stay order then you can sell.
In my opinion, if the shops are not divided by metes and bounds and are under a single title deed, moreover there is a litigation pending, it may not be possible to demarcate the shops with boundaries to enable you to sell one shop alone.
Chances are that you may be in a bad situation by going ahead with the proposed act, hence it would be better that you wait for the litigation to come to a close/disposed to take any action on this.
If the shops are covered under the pagdi system law, would there any long term capital gains tax if the rights are transferred either to the landlord or to the new tenant? Would the owner be liable for LTCG tax or the tenant?
Asked 5 years ago
since it is extinguishment of rights which is to be treated as transfer and chargeable to capital gains
No LTCG taxes will be applicable to this situation.
However income tax may have to be paid by showing this as income from other sources.
In pagdi system, it is not sale of property.
Since judgment is pronounced with respect to first shop, you can go ahead and sell it.
Litigation of Second shop is independent to first shop.
However, the finding giving in judgment needs to be perused for giving clarity.
Yes, there will be LTCG on the same, if the rights are transfer for consideration.
NO
LTCG taxes is applicable.
Yes they are covered and liable