ASHA JOHN DIVIANATHAN versus VIKRAM MALHOTRA & ORS.

ASHA JOHN DIVIANATHAN versus VIKRAM MALHOTRA & ORS.

The Court held that Section 31 FERA 1973 mandates previous/general or special permission of the RBI for acquisition, holding or disposal of immovable property by non-citizens and, read with Sections 47, 50 and 63, a transfer without such prior permission is unenforceable in law (effectively prohibited); consequently the gift deeds dated 11.03.1977 and 19.04.1980 were unenforceable, the impugned judgment and decree were set aside, O.S. No.10079 of 1984 was decreed in toto in favour of the plaintiff (predecessor) and the appellant (as legal representative) was entitled to possession and mesne profits with a separate inquiry under Order 20 Rule 12 CPC; contrary High Court decisions were...

Parties
Appellant: Asha John Divianathan; Respondent: Vikram Malhotra; Original Plaintiff: R.P. David (deceased)
Jurisdiction
India
Judgment Date
26 February 2021
Procedural Posture
Civil Appeal / Final Disposal on Appeal From High Court Judgment
Outcome
Appeal allowed
Legal Topics
Section 31 FERA 1973, Section 47 FERA 1973, Section 50 FERA 1973, Section 63 FERA 1973, Void Vs Voidable, Prior RBI Permission, Mesne Profits, Order 20 Rule 12 CPC, Article 142 Constitution
Foreign Exchange Regulation Statutory Interpretation Contract Law Transfer of Property Civil Procedure Constitutional Law Section 31 FERA 1973 Section 47 FERA 1973 +7 more

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Parties

Asha John Divianathan

Appellant

Vikram Malhotra

Respondent

R.P. David (deceased)

Original Plaintiff

Procedural Posture

Civil Appeal / Final Disposal on Appeal From High Court Judgment

Legal Issues

  1. 1 Whether transfer of immovable property by a person who is not a citizen of India without previous general or special permission of the Reserve Bank of India under Section 31 of the Foreign Exchange Regulation Act, 1973 is void or voidable
  2. 2 Whether ex post facto permission can be granted by the RBI under Section 31
  3. 3 Who may challenge transactions entered in contravention of Section 31

Ratio Decidendi

The Court held that Section 31 FERA 1973 mandates previous/general or special permission of the RBI for acquisition, holding or disposal of immovable property by non-citizens and, read with Sections 47, 50 and 63, a transfer without such prior permission is unenforceable in law (effectively prohibited); consequently the gift deeds dated 11.03.1977 and 19.04.1980 were unenforceable, the impugned judgment and decree were set aside, O.S. No.10079 of 1984 was decreed in toto in favour of the plaintiff (predecessor) and the appellant (as legal representative) was entitled to possession and mesne profits with a separate inquiry under Order 20 Rule 12 CPC; contrary High Court decisions were...

Court Disposition

Appeal allowed

Orders

  • Impugned judgment and decree of the Trial Court as confirmed by the High Court set aside
  • O.S. No.10079 of 1984 filed by R.P. David (predecessor) decreed in toto in favour of the plaintiff