2025 INSC 273
SUPREME COURT OF INDIA
(HON’BLE J. B.
PARDIWALA, J. AND HON’BLE R. MAHADEVAN, JJ.)
M.S. ANANTHAMURTHY
Petitioner
VERSUS
J. MANJULA ETC.
Respondent
Civil
Appeal Nos. 3266-3267 OF 2025 (ARISING OUT OF SPECIAL LEAVE PETITION (C) NOS.
13618-13619 OF 2020)-Decided on 27-02-2025
Civil, TPA
(A)
Transfer of Property Act, 1882, Section 54 and 55 – Transfer of Property – Transfer by GPA and Agreement to Sell - Whether
the agent, A. Saraswathi, by virtue of being a holder of the General Power of
Attorney along with Agreement to Sell had any right, title or interest in the
subject-matter of the agency, to execute the registered sale deed dated
01.04.1998 in favour of her son i.e., the appellant no. 2, after the death of
the principal, on 30.01.1997? – Held that it is a settled law that a transfer
of immovable property by way of sale can only be by a deed of conveyance - An
agreement to sell is not a conveyance - It is not a document of title or a deed
of transfer of deed of transfer of property and does not confer ownership right
or title - An agreement to sell does not meet the requirements of Sections
54 and 55 of the TPA to effectuate a ‘transfer’ - From the independent
reading of the POA and the agreement to sell, the submissions of the appellants
fail on two grounds, first, the POA is general in nature and does not secure
agent’s right in the subject-matter of the agency, and secondly, an agreement
to sell simpliciter does not confer ownership in the immovable property so as
to transfer a better title to anyone else.
(Para 47 and 48)
(B)
Specific Relief Act, 1963, Section 38 – Injunction – Title Suit - Whether it was obligatory for the answering respondent
to challenge the execution and validity of the General Power of Attorney and
the Agreement to Sell dated 04.04.1986 and a further prayer to declare that the
registered sale deed dated 01.04.1998 is invalid, non-est or illegal in O.S.
133/2007? – Held that where the question of title is “directly and
substantially” in issue in a suit for injunction, and where a finding on an
issue of title is necessary for granting the injunction, with a specific issue
on title raised and framed, a specific prayer for a declaration of title is not
necessary - As a result, a second suit would be barred when facts regarding
title have been pleaded and decided by the Trial Court - In the present suit,
the findings on possession rest solely on the findings on title - The Trial Court
framed a categorical issue on the ownership of the appellants herein.
(Para 57 and 58)
(C)
General Power of Attorney - Irrevocable’ in a POA – Held that evident from the tenor
of POA that is not irrevocable as it was not executed to effectuate security or
to secure interest of the agent - The holder of POA could not be said to have
an interest in the subject-matter of the agency and mere use of the word ‘irrevocable’
in a POA would not make the POA irrevocable - High Court was right in holding
that the holder did not have any interest in the POA - When the High Court
observes that the power of attorney does not explicitly state the reason for
its execution, it implies that its nature is general rather than special.
(Para 46)
(D)
Contract Act, 1872, Chapter X - Powers-of-Attorney Act, 1882, Section 1-A and 2
- Power of Attorney –
Basic Principle - Held that a power
of attorney derives its basic principles from Chapter X of the Contract
Act which provides for “Agency” along with Sections 1A
and 2 respectively of the Act, 1882 - Agency is a fiduciary
relationship between two persons, where one explicitly or implicitly agrees
that the other will act on their behalf to influence their legal relations with
third parties, and the other similarly agrees to act in this capacity or does
so based on an agreement - The relationship between the executant of a general
power of attorney and the holder of the power is one of principal and agent - A
principal is bound by the acts done by an agent or the contracts made by him on
behalf of the principal - Likewise, power of attorney in the nature of contract
of agency authorizes the holder to do acts specified by the executant, or
represent the executant in dealings with third persons. (Para 27)
(E)
Contract Act, 1872, Chapter X - Powers-of-Attorney Act, 1882, Section 1-A and 2
- Power of Attorney –
Agency - Held that power of attorney
is a creation of an agency by which the grantor/donor/executant authorizes the
grantee/donee/holder/attorney to do the acts specified on his behalf, which
will be binding on the executant as if the acts were done by him. (Para 30)
(F)
Contract Act, 1872, Section 302 – Contract - Revocation of agency - Essentials
of Section 202 of the Contract Act are, first, there shall be a
relationship in the capacity of ‘principal and agent’ between the parties and
secondly, there shall be agent’s interest in the subject-matter of the agency -
If both the conditions are fulfilled the agency becomes irrevocable and cannot
be terminated unilaterally at the behest of the principal.
(Para 35)
(G)
Power of Attorney –
Nature of - Held that the import of
the word “general” in a POA refers to the power granted concerning the subject
matter - The test to determine the nature of POA is the subject matter for
which it has been executed - The nomenclature of the POA does not determine its
nature - Even a POA termed as a ‘general power of attorney’ may confer powers
that are special in relation to the subject matter - Likewise, a ‘special power
of attorney’ may confer powers that are general in nature concerning the
subject matter - The essence lies in the power and not in the subject-matter.
(Para 42)
(H) Power
of Attorney - ‘Irrevocable’ in a POA – Held that a mere use of the word
‘irrevocable’ in a POA does not make the POA irrevocable - If the POA is not
coupled with interest, no extraneous expression can make it irrevocable. At the
same time, even if there is no expression to the effect that the POA is
irrevocable but the reading of the document indicates that it is a POA coupled
with interest, it would be irrevocable.
(Para 45)
(I)
Registration Act, 1908, Section 17 and 49 – General Power of Attorney –
Agreement to sell –
Unregistered documents - Appellants submitted that that since the GPA and the
agreement to sell were executed by the same person in favour of the same
beneficiary, it ought to have been read together – Held that from the combined
reading of the POA and the agreement to sell, the submission of the appellants
fails as combined reading of the two documents would mean that by executing the
POA along with agreement to sell, the holder had an interest in the immovable
property - If interest had been transferred by way of a written document, it
had to be compulsorily registered as per Section 17(1)(b) of the
Registration Act - The law recognizes two modes of transfer by sale, first,
through a registered instrument, and second, by delivery of property if its
value is less than Rs. 100/- - High Court rightly held that even though the GPA
and the agreement to sell were contemporaneous documents executed by the
original owner in favour of the holder, this alone cannot be a factor to reach
the conclusion that she had an interest in the POA - Thus, even though the GPA
and the agreement to sell were contemporaneous documents executed by the
original owner in favour of the same beneficiary, this cannot be the sole factor
to conclude that she had an interest in the subject-matter - Even if such an
argument were to persuade this Court, the document must have been
registered as per Section 17(1)(b) of the Registration Act - In the
absence of such registration, it would not be open for the holder of the POA to
content that she had a valid right, title and interest in the immovable
property to execute the registered sale deed in favour of appellant no.2.
(Para
49, 53 and 55)
JUDGMENT
J.B. Pardiwala, J. :- Leave granted.
2.
Since the issues raised in both the captioned appeals are the same, the parties
are also same and the challenge is also the self-same, hence those were taken
up analogously and are being disposed of by this common judgment and order.
3.
These appeals have been filed before this Court from the judgment and order
passed by the High Court of Karnataka at Bengaluru dated 16.10.2019 in R.F.A.
No. 1318/2014 c/w R.F.A. No. 1317/2014 (“impugned judgment”) whereby the High
Court dismissed the appeals and affirmed the common judgment and decree dated
21.06.2014 passed in O.S. No. 133/2007 and O.S. No. 4045/2008 by the Court of
VIII Additional City Civil & Sessions Judge at Bengaluru City.
A.
FACTUAL MATRIX
4.
The description of the parties before this Court, the High Court and before the
Trial Court is tabulated as follows:-
|
BEFORE
THIS COURT |
BEFORE
THE HIGH
COURT |
BEFORE
THE TRIAL
COURT |
REMARKS |
|
Muniyappa |
- |
- |
Original
Owner |
|
A.
Saraswathi |
- |
- |
Holder of POA |
|
Appellants |
Petitioners |
Plaintiff
in O.S.
No. 4045/2008 |
Defendant in suit instituted by the respondent no. 9 |
|
Respondent Nos. 1-6 |
Respondent
Nos. 1-6 |
Defendant
Nos. 1-6 |
Legal heirs of original owner |
|
Respondent No. 7 |
Respondent
No. 7 |
Defendant
No. 7 |
Purchaser |
|
Respondent No. 8 |
Respondent
Nos. 8-10 |
Defendant
No. 8 |
Purchaser |
|
Respondent No. 9/Answering Respondent |
Respondent
No. 11 |
Plaintiff
in O.S.
No. 133/2007 |
Defendant no. 9 in suit instituted by the appellants/Gift Deed Holder |
Appellant
no. 2 was represented by his general power of attorney holder i.e., appellant
no. 1, for the purposes of the appeal before the High Court and this Court.
5.
The dispute arises from a common claim put forward by the appellants and the
answering respondent on property bearing Site No. 10, out of Sy. No. 55/1,
situated at Chunchaghatta Village, Uttarahalli Hobli, Bangalore South
Taluk (hereinafter referred to as “Suit Property”). The Suit Property
originally formed part of 1 acre 8 guntas of land situated in Chunchaghatta
Village, Uttarahalli Hobli, Bangalore South Taluka within the revenue limits of
Konanakunte Gram Panchayat owned by late Muniyappa @ Ruttappa (hereinafter
referred to as “original owner”). The original owner developed the said land in
the form of individual plots and sold those plots for consideration to various
person. The Suit Property is one of those plots.
6.
It is the case of the appellants that on 04.04.1986, the Suit Property was sold
by the original owner one A. Saraswathi (hereinafter referred to as “holder”)
for total sale consideration of Rs.10, 250/- by executing an irrevocable power
of attorney (hereinafter referred to as “POA”) and an unregistered agreement to
sell. The contents of the said POA and agreement to sell are extracted herein below:-
“GENERAL POWER OF
ATTORNEY KNOW ALL MEN BY THESE PRESENTS THAT, I, Muniyappa urf Ruttappa Son of
Ragallappa, Major, residing at Vajarahalli village, Uttarahalli Hobli,
Bangalore South Taluk do hereby appoint, nominate and constitute Smt. A.
Saraswathi W/O M. S. Anantha Murthy, residing at No. 155, 5th Cross,
Wilsongarden, Bangalore - 560 027 as my General Power of Attorney holder to do
the following acts, deeds and things on my behalf that is to say:
1) To look after, maintain, manage the
Schedule Property in the best manner as my attorney deems fit.
2) To enter into any
type of agreements in respect of the Schedule property with any person for any
amount, receive advance amount, issue proper receipts, apply to the competent
authority seeking permission to execute any type of deeds, in favour of any
persons, and to execute such deeds in favour of such persons, receive full
consideration amount, issue proper discharge thereof, sign all deeds, forms
etc., etc.,
3) To apply for transfer
of Khata and to pay all future taxes and to receive proper receipts.
4) To apply for
sanctioned plan for construction of any type of building on the property and to
construct such building, utilise the same as my attorney deems fit and to get
all profits therefrom.
5) To represent me in
respect of the Schedule property in all Government offices, BDA, BWSSB, KEB,
Corporation etc., etc., apply for any type of documents, receive the same, and
approach BDA for reconvey of Schedule property, to pay all betterment charges
and to do all connected things.
6) In case of
complications to sue such matters in proper courts, of law by engaging the
service of advocates or advocate, sign all forms, vakalath, suits, petitions,
etc, produce any documents in court, take any documents from the court, give
evidence, obtain decree, execute the sale or enter into compromise.
7) The Schedule
property is in my peaceful possession and enjoyment thereof as absolute owner
thereof.
8) My Attorney is ge11erally entitled to do
all such acts, deeds and things, in respect of the Schedule property, which are
not specifically written hereunder and I do hereby agree to ratify confirm all
such acts, deeds and things done by my attorney as the acts, deeds and things
done by me in person and this G.P.A. is irrevocable in nature.
SCHEDULE
Site No. 10, out of
Sy. No. 55/1, situated at Chunchaghatta Village, Uttarahalli Hobli, Bangalore
South Taluk, measuring East to West 30 feet and North to South (40-6” +
42-3”)/2 feet and bounded as follows:-
North by: Road &
South by: Private Property In witnesses whereof I the executant above named
signed this General Power of Attorney on this 4th day of April 1986 at
Bangalore.
Identified by me
Executant Execution admitted before me S.B. Chandrasekhar Bangalore
Metropolitan Area Notary Bangalore Date: 4-4-1986 SALE AGREEMENT This Deed of
Sale Agreement is made on this 4th day of April, 1986 at Bangalore and executed
by Sri. Muniyappa urf Ruttappa, Son of Ragallappa, residing at Chunchaghatta
village, Uttarahalli Hobli, Bangalore South Taluk hereinafter called the
“VENDOR” (which term shall mean and include all his heirs,
executors, administrators and assignees) of the one part and in favour of
Srimathi. A. Saraswathi W/O, Ananthamurthy, residing at No. 155, 5th Cross,
Wilson Garden, Bangalore-560 027 hereinafter called the “PURCHASER” (which term
shall mean and include all heirs, executors, administrators and assignees) of
the other part witnesseth as follows:~ WHEREAS the Vendor is the absolute owner
in peaceful possession and enjoyment of the Schedule Property more fully
described in the Schedule hereunder.
And whereas the Vendor
is in need of funds for the maintenance of his family and other legal
necessities he desired to sell the Schedule Property in favour of the purchaser
for a sum of Rs 10,250/-(Rs. Ten thousand two hundred fifty only) to which the
Purchaser duly agreed to purchase the same for the said sum of Rs. 10,250/-
only. In pursuance of this Sale agreement the purchaser paid a sum of Rs.
5,000/- on 20-5-1985 through a Cheque No. 0861556 of Syndicate Bank,
Wilsongarden Branch, Bangalore and a sum of Rs. 5,250/- only Cheque No. 039
529/243 dated 3.4.86 of Syndicate Bank Wilson Garden, Bangalore total the
Vendor received the full sale consideration of Rs.10,250/- only. This day the
Vendor handed over the vacant possession of the Schedule property to the
purchaser to have and to hold the same as absolute owner.
As there is a
prohibition of selling the revenue sites by the Government of Karnataka the
Vendor could not execute the sale deed. As and when the Government of Karnataka
revokes the fragmentation act the Vendor execute the sale deed.
This day the Vendor
handed over the vacant possession of the Schedule property to the purchaser,
the Vendor have no objection to construct a dwelling house on the Schedule
property the Vendor have no objection to transfer the Khata of the Schedule
Property to the name of the purchaser. The Vendor assures the purchaser
that the schedule property is free from all kinds of encumbrances and it is
free from all taxes.
SCHEDULE:- Site No.
10, out of Sy. No. 55/1, situated at Chunchaghatta Village, Uttarahalli Hobli,
Bangalore South Taluk, measuring East to West 30 feet and North to South (40-6”
+ 42-3”)/2 feet and bounded as follows:-
North by: Road &
South by: Private Property In witnesses whereof both the parties have affixed
their signatures to this sale agreement on the day, month and the year above
first written.
WITNESSES:
1.
2.
3.
VENDOR PURCHASER”
7.
On the same day, the said POA was duly notarized. On 30.01.1997, the original
owner, executant of the POA died. On 01.04.1998, the holder of POA executed a
registered sale deed with respect to the Suit Property in favour of her son,
i.e., the appellant no. 2, in exchange of sale consideration of Rs. 84,000/-.
8. On the other hand, several years after the
death of the original owner, his legal heirs through a registered sale deed
dated 21.03.2003 sold the same Suit Property to the respondent no. 7 for total
sale consideration of Rs. 76,000/-. Subsequently, respondent no. 7 sold the
Suit Property to the respondent no. 8 vide another registered sale deed dated
29.09.2003 for total sale consideration of Rs. 90,000/-. Then, on 06.12.2004,
the respondent no. 8 executed a registered gift deed in favour of her daughter,
i.e., the answering respondent.
9.
It is the case of the appellants that after a long period of time, the father
of appellant no. 2, i.e., the appellant no. 1 herein, visited the Suit Property
on 02.01.2007. To his shock and surprise, he found strangers in possession of
the Suit Property. He, accordingly, lodged a police complaint with the
concerned police station. The occupants as well as the answering respondent
were called by the police to the police station. However, the police closed the
matter saying that the dispute was civil in nature.
10.
Later, the answering respondent filed O.S. No. 133/2007 for permanent
injunction against the appellant no. 2 or anyone else acting under him from
interfering with the peaceful possession and enjoyment of the Suit
Property. Following this, the appellant no. 2 also filed O.S. No.
4045/2008 against the legal heirs of the original owner, the subsequent
purchasers and the answering respondent respectively for declaration of sale
deeds executed on 21.03.2003 and 29.09.2003 respectively, and the gift deed executed
on 06.12.2004 as null and void. He sought further declaration of absolute
ownership and direction to handover vacant physical possession of the Suit
Property. Both the suits were consolidated and tried together by way of
recording common evidence.
11.Upon
appreciation of the oral as well as documentary evidence on record, the Trial
Court vide its common judgment and order dated 21.06.2014 decreed the O.S. No.
133/2007 filed by the answering respondent by granting a decree of permanent
injunction in her favour and dismissed the O.S. No. 4045/2008 filed by the
appellant no. 2 herein.
12.
The findings recorded by the Trial Court in its judgment and order can be
better understood in four parts:-
(i) First, on the
issue of possession the Trial Court recorded that it was an admitted position
that the answering respondent was in possession of the Suit Property. Further,
the registered sale deed dated 29.09.2003 reflected that the respondent
no. 8 had purchased the Suit Property from the respondent no. 7 for total sale
consideration of Rs. 90,000/- and then respondent no. 8 gifted the property to
the answering respondent vide the registered gift deed dated 06.12.2004. While,
evaluating the evidence adduced by the appellants (defendants therein) the
Trial Court from the cross-examination of appellant no. 1 recorded that two
days prior to 01.04.1998, he had visited the Office of Sub-Registrar and found
that the revenue site was being registered. Further, it was an admitted
position that, though allegedly, a general power of attorney (“GPA”) and
agreement to sell were executed by the original owner in favour of the holder
in the year 1986, yet the appellant no. 2 was not in possession of the Suit
Property as on the date of the institution of the suit. The Trial Court held
that the answering respondent is the donee of the Suit Property and is in
lawful possession and that the appellant no.2 is not entitled to seek recovery
of possession.
(ii) Secondly, on the
issue of legality of registered sale deed dated 21.03.2003 that was executed by
the respondent nos. 1-6 in favour of the respondent no. 7, the Trial Court
proceeded with the premise that it was an admitted position that as on the
date of institution of suit, the appellants were not in possession of the Suit
Property. It held that though, the original owner had executed the GPA and the
agreement to sell, yet the holder of POA failed to get it registered in time.
The contention of the appellants that the GPA and the agreement to sell
respectively were not registered in 1986 due to a prohibition on the
registration of revenue lands was rejected. It was held by the Trial Court that
for transfer of ownership in immovable property, whose value is more than Rs.
100/-, the conveyance has to be mandatorily registered as per Section
17 of the Registration Act, 1908 (for short, “Registration Act”) and sale
by GPA is not recognized by law. By placing reliance on Suraj Lamp &
Industries Pvt. Ltd. v. State of Haryana, reported in (2012) 1 SCC 656, the
Trial Court held that the sale deed dated 01.04.1998 executed by the holder of
POA in favour of the appellant no. 2 was invalid along with the admitted
position that it was executed after the death of the original owner. Thus, it
was held that the registered sale deed dated 21.03.2003 executed in favour of
the respondent no. 7 was legal.
(iii) Thirdly, on the issue of legality of
registered sale deed dated 29.09.2003 which was executed by the respondent no.
7 in favour of the respondent no. 8, and the registered gift deed dated 06.12.2004
which was executed by the respondent no. 8 in favour of the answering
respondent, the Trial Court held that the appellants failed to prove that the
above-mentioned sale deed and gift deed were illegal, null and void. At the
same time, it held that the respondent no. 8 had a valid title over the Suit
Property so as to execute the gift deed in favour of the answering respondent.
(iv) Lastly, on the
issue of maintainability of the suit instituted by the appellants, the Trial
Court held that the suit instituted by the appellants was barred by limitation.
It held that as per Article 58 of the Limitation Act, 1963 (for
short, “Act of 1963”), for the purpose of challenging the sale deeds dated
21.03.2003 and 29.09.2003 respectively and the gift deed dated 06.12.2004, he
should have presented the suit within three years from the date of the alleged
sale deed or agreement to sell as he had come to know about the sale
transactions in the year 2003 itself.
B.
IMPUGNED JUDGMENT
13.
Being aggrieved by the order of the Trial Court, the appellants/judgment
debtor, preferred First Appeal. The High Court framed the following points for
determination:-
“14. In the light of
the above, the points that arise U for my consideration in this appeal are:-
1] Whether the
appellant herein (plaintiff in O.S.No.4045/2008) proves that he is the absolute
owner of the suit schedule property?
2] Whether the registered
Sale Deed dated 01-04-1998 in favour of the plaintiff in O.S.No.4045/2008
executed by Smt. A. Saraswathi as a General Power of Attorney holder would
convey a valid title in favour of the plaintiff?
3) Whether the
plaintiff in O.S.No.133/2007 would prove that she is in lawful possession of
the property as on the date of the institution of the suit?
4] Whether the
plaintiff ln O.S.No.133/2007 has proved that there was an interference in her
lawful possession of the suit schedule property by the defendants?
5) Whether the common
judgment and the decrees under appeals deserve interference at the hands of
this Court?”
14.
The High Court dismissed both the appeals and thereby affirmed the judgment and
decree passed by the Trial Court. The High Court dismissed the appeals on four
grounds:-
(i) First, the High
Court held that the appellants had not denied or disputed the existence of the
two registered sale deeds dated 21.03.2003 and 29.09.2003 respectively and the
gift deed dated 06.12.2004 in the suit preferred by the answering
respondent. The said documents made it amply clear that the Suit Property was
sold by the legal representatives of the original owner in favour of the
respondent no. 7, who in turn vide a registered sale deed then sold the same
Suit Property to the respondent no. 8. The respondent no. 8 thereafter gifted
the Suit Property to her daughter, i.e., the answering respondent by way of a
registered gift deed dated 06.12.2004. Accordingly, answering respondent is the
lawful owner in possession of the Suit Property.
The relevant
observations read as under:-
“22. As already
observed above, the plaintiff in O.S.No. 4045/2008 has not denied or disputed
the documents at Exs. P-1, P-2, P-3 which are two registered Sale Deeds and a
Gift deed respectively. By virtue of the said documents, it goes to show that
the suit schedule property was sold by the legal representatives of the
deceased Muniyappa @ Ruttappa in favour of one Sri. S. Sreenivasulu on 21-03-
2003 which Sreenivasulu in turn sold the very same suit scheduled property to
one Smt. C. Roopavathi (the mother of the plaintiff in O.S.No.133/2007) under a
registered Sale Deed dated 29-09-2003. The said Smt. C. Roopavathi, in turn,
has gifted the said property to her daughter – Smt.J. Manjula (plaintiff in
O.S.NO.133/2007) under a registered Gift Deed dated 06-12-2004. It is based
upon these documents and the subsequent documents like tax paid receipts,
self-declaration of property tax and the water bill and water tax receipt which
have all been produced as exhibits in ‘P’ series as observed above, the learned
counsel for the plaintiff in O.S.No.133/2007 (Respondent in R.F.A.No.1318/2014)
contends that, it is Smt. J. Manjula -the plaintiff in O.S.No.133/2007 has been
in lawful possession of the suit schedule property in her capacity as the owner
of the suit schedule property.”
(ii) Secondly, the
High Court observed that the appellant no. 1 in his cross-examination had
admitted that the original owner-executant of POA, died on 30.01.1997. It is
further an admitted position that the registered sale deed in favour of the
appellant no. 2 was executed on 01.04.1998 i.e., after the death of the
executant. The said sale deed was executed by the holder of POA in her capacity
as a GPA holder of the original owner. Therefore, the execution of sale deed
dated 01.04.1998 was after the death of the executant of GPA. The appellants
submitted that since the holder had an interest in the POA, it should be read along
with the agreement to sell which was executed pursuant to sale consideration.
The High Court while addressing the aforesaid submissions of the appellants
held that though the GPA and the agreement to sell were executed by the same
executant on the same day in favour of the same holder yet they cannot be
treated as a single transaction. The detailed and comprehensive reading of the
GPA and the agreement to sell would indicate that the contents of the GPA do
not mention anything about the execution or purpose of executing the
agreement to sell or vice versa.
The relevant
observations read as under:-
“…Even though it is
observed that Exs.D-4 and D-5 were contemporaneous documents executed by Sri.
Muniyappa @ Ruttappa in favour of Smt. A. Saraswathi, by that itself, it cannot
be concluded that, the said Smt. A. Saraswathi had any interest in the Power of
Attorney at Ex.D-4. It is for the reason that the said document at Ex.D-4
nowhere expressly mentions as to for what reason the executant was made to
execute the said document and more particularly, the executant has nowhere
whispered in it that the attorney has acquired any interest in the property
mentioned in the said Power of Attorney. However, the said Power of Attorney –
Smt. A. Saraswathi whether is having any interest under the said irrevocable
Power of Attorney has to be gathered from the circumstance of the case and the
position of law. If it can be concluded that she had acquired interest by
virtue of Exs.D-4 and D-5, then probably, Section 202 of the Contract
Act may come into picture. Otherwise, it would be Section 201 of the
Contract Act that may come into operation.”
(iii) Thirdly, the
principal contention of the appellants was that since the holder of POA had an
interest in the property which is the subject-matter of the POA, the POA would
not come to an end on the death of the executant by virtue of Section
202 of the Indian Contract Act, 1872 (for short, “the Contract Act”).
The High Court held that executing a POA, including an irrevocable one or an
agreement to sell for immovable property, does not automatically transfer any
right or interest to the beneficiary, such as the attorney or agreement
holder. By referring to the decisions of the High Court of Rajasthan
in Prahlad & Ors. v. Laddevi & Ors., reported in 2007 SCC OnLine
Raj 19 and the High Court of Karnataka in Wajid Pasha v. The Chairman,
Bangalore Development Authority, reported in 2013 SCC OnLine Kar 10135, the
High Court held that the purpose for which the GPA was executed had not been
stated either in the GPA or the agreement to sell. It was observed that
indisputably, the holder of POA did not enforce the agreement to sell against
the legal representatives of the executant of the POA. After the death of the
executant, the holder of POA transferred the Suit Property to her son i.e., the
appellant no. 2, for a sale consideration of Rs. 84,000/- which was
considerably higher than the amount she paid for the Suit Property to the
original owner. Thus, the High Court held that the case of the appellants would
not be covered by Section 202 of the Contract Act and that the POA
did not create any right or interest in the favour of the holder of the POA.
The relevant observations read as under:-
“38. Illustration (a)
to Section 202 of the Contract Act is clear and applicable to those
cases where the very purpose or execution of the Power of Attorney is to enable
the Power of Attorney to get his/her entitlement paid to him/her. It
is in that case, the attorney holder can be called as having interest in
the General Power of Attorney executed in his/her favour, whereas, in the case
on hand, as already observed above, the purpose for which the General Power of
Attorney was executed by Sri. Muniyappa @ Ruttappa is nowhere made clear either
in Ex.D-4 or Ex.D-5. Merely because they are contemporaneous documents, it
cannot be inferred that the holder of the said agreement would get an interest
under the General Power of Attorney so as to over come Section 201 of
the Contract Act and fall within the scope of Section 202 of the same
Act. This is clear in all the three judgments referred above which
were relied upon by the learned counsel for the respondents.
Rather in those
situations, where the sale agreement holder though was put in possession and
had already parted with some consideration, the remedy available to such
agreement holder would be for enforcing the contract, specifically either as
against the executant or his/her legal representatives.”
(iv) Fourthly, the
High Court noted that the answering respondent not only established her lawful
possession over the Suit Property as on the date of the institution of the suit
but was also able to establish that there was interference with her peaceful
possession by the appellants herein. The High Court held that the suit was not
barred by limitation. It held that the Trial Court erred in holding so, as the
suit was one for declaration and possession of the property. Therefore, as per Article
65 of the Act of 1963, the period of limitation would be twelve years.
15.
In such circumstances, referred to above, the appellants are here before
this Court with the present appeals.
C.
SUBMISSIONS ON BEHALF OF THE APPELLANT(S)
16.
Ms. Farhat Jahan Rehmani, the learned counsel appearing for the appellants
submitted that the present case relates to the scope, interpretation and
construction of the POA and the agreement to sell dated 04.04.1986 executed by
the original owner in favour of holder. Hence, the limited question for our
determination is whether the POA, which was coupled with interest is
irrevocable as per Section 202 of the Contract Act or it stood
terminated upon the death of the original owner as per Section 201 of
the Contract Act?
17.
Ms. Rehmani submitted that the fact of execution of the POA and the agreement
to sell in favour of the holder by the original owner in exchange of sale
consideration is not disputed. Since both the POA and the agreement to sell are
in favour of the same person, they should be read together and construed
harmoniously. The holder of POA executed the registered sale deed dated
01.04.1998 in favour of the appellant no. 2. Further, there is no challenge to
the validity of the GPA and agreement to sell dated 04.04.1986 and the
registered sale deed dated 01.04.1998. The GPA specifies that it had been
executed for the purpose of the Suit Property. It specifically mentions that it
is ‘irrevocable’ and the schedule to the GPA references the particulars of the
Suit Property. The GPA read with the agreement to sell would indicate that it
had been executed for a valid sale consideration, and possession of the Suit
Property was also delivered to the holder of POA. Thus, she had an interest in
the subject-matter of the agency being irrevocable. By placing reliance
on Section 202 of the Contract Act, he submitted that where the agent
himself has interest in the property which forms a subject-matter of the
agency, the agency cannot be terminated to the prejudice of such interest of
the agent. In the facts of the case, Section 202 of the Contract Act
is applicable and not Section 201.
18.
It was further submitted that the High Court erred in holding that the purpose
for which the GPA and the agreement to sell was executed was not mentioned in
either of the documents and therefore, even though the two documents are
contemporaneous yet it cannot be inferred that the holder of the two documents
would derive an interest in the subject-matter of the GPA. Ms. Rehmani asserted
that it has to be inferred that the original owner executed the agreement
to sell as a consequence of executing the GPA in favour of the holder, hence,
the said POA is not irrevocable merely for the reason that in the said
documents the purpose for executing the GPA and agreement to sell has not been
mentioned.
19.
While drawing the Court’s attention to para 26 of Suraj Lamp (supra),
she submitted that the case of Suraj Lamp (supra) will not be
applicable to the facts of the present case as in the present case the holder
of GPA executed the registered sale deed on 01.04.1988 which was much prior in
time. She further distinguished the decision in Prahlad (supra)
and Wajid Pasha (supra) referred to and relied upon by the High Court
on facts. Ms. Rehmani submitted that the High Court failed to consider that
there was no challenge to the validity of the GPA, and the registered sale deed
executed in favour of appellant no. 2. In such circumstances, a suit for
injunction simpliciter filed by the answering respondent would not be
maintainable. Further, the respondent no. 7 had no title in the Suit Property
as the title had already been conveyed under the registered sale deed and there
was no challenge to the same. The suit O.S. No. 4045/2008 filed by the
appellants for declaration and possession ought to have been decreed.
20. In view of the aforesaid submissions, the
counsel prayed that the impugned judgment passed by the High Court be set aside
and appellants be declared to be the true owner of the Suit Property and grant
possession thereof.
D.
SUBMISSIONS OF BEHALF OF THE RESPONDENT(S)
21.
Mr. Mahesh Thakur, the learned counsel appearing for the answering respondent
submitted that an agreement of sale creates an interest against the vendor or
his legal representatives and to enforce that interest the intended buyer is
required to file a suit for specific performance by virtue of Section
40 of the Transfer of Property Act, 1882 (for short, “the TPA”). In view
of Section 17 of the Registration Act, a property worth Rs. 100 or
more cannot be transferred without registration. In the present case, the value
of property is more than Rs. 100, therefore, the original owner could not have
transferred the property merely by an agreement to sell or GPA or by executing
both.
22.
To buttress his aforesaid submission that such documents cannot pass on title,
Mr. Thakur relied on the decision in Suraj Lamp (supra) to submit
that by virtue of Section 54 of the TPA, an agreement to sell does
not create any interest in or charge on such property. Further, a POA is
not an instrument of transfer qua any right, title or interest in any immovable
property. A sale by an agreement to sell or GPA will neither convey any title
nor create any interest in an immoveable property. He relied on Wajid
Pasha (supra) to submit that the contract of agency gets automatically
terminated by death of either of the parties. As soon as the executant of POA
dies, the right given to the agent comes to an end. Once the agency is
terminated, the agent cannot act on the basis of the power granted to him under
the GPA. He also placed reliance on Prahlad (supra) to submit
that a POA granted by the donor to the donee is operative and effective only
during the lifetime of the donor. Since the donor and done are in a relationship
of master-agent a POA cannot stand after the death of the donor. He asserted
that the principle of nemo dat quod non habet would apply meaning thereby that
the holder of POA could not have passed a title that she did not possess.
23.
Mr. Thakur further submitted that even if for the sake of argument, it is
presumed that the GPA was coupled with interest and Section 202 of
the Contract Act comes into operation, still it can apply only to an extent
that the buyer can enforce the agreement against the vendor or his
legal representatives for specific performance or for return of the sale
consideration paid. Lastly, he submitted that it is not the case of the
appellants that legal representatives of the original owner were aware about
the transaction between their father and the holder of POA. Answering
respondent now holds the position of a bona fide purchaser for valuable
consideration.
24.
In such circumstances referred to above, the counsel prayed that there
being no merit in the present appeals, those may be dismissed.
E. ISSUES FOR CONSIDERATION
25.
Having heard the learned counsel appearing for the parties and having gone
through the materials on record, the following questions fall for our
consideration:
a. Whether the agent,
A. Saraswathi, by virtue of being a holder of the General Power of Attorney
along with Agreement to Sell had any right, title or interest in the
subject-matter of the agency, to execute the registered sale deed dated
01.04.1998 in favour of her son i.e., the appellant no. 2, after the death of
the principal, on 30.01.1997?
b. Whether it was obligatory for the answering
respondent to challenge the execution and validity of the General Power of
Attorney and the Agreement to Sell dated 04.04.1986 and a further prayer to
declare that the registered sale deed dated 01.04.1998 is invalid, non-est or
illegal in O.S. 133/2007?
F.
ANALYSIS
26.
At the cost of repetition, we deem it necessary to state how the property
exchanged hands on both sides. It is the case of the appellants that the
original owner executed a GPA and agreement to sell in favour of the holder.
Thereafter, the holder in her capacity as a holder of POA vide a registered
sale deed sold the Suit Property to her son, appellant no. 2. On the other
hand, it is the case of the respondents that after the death of the original
owner, his heirs (respondent no. 1-6) sold the Suit Property to S.
Sreenivasullu (respondent no.7) vide a registered sale deed, thereafter, S.
Sreenivasullu sold the Suit Property to C. Roopavathi (respondent no. 8) vide
another registered sale deed. Lastly, C. Roopavathi vide a registered gift deed
gifted the Suit Property to her daughter, J. Manjula (answering respondent).
Appellant’s Version
Respondent’s Version
Muniyappa @Ruttapa (Owner) After Muniyappa’s
death
Heirs of the Owner
A. Saraswathi (GPA holder) S. Sreenivasullu
C. Roopavathi
A. Manohar (appellant no. 2)
J. Manjula (answering respondent)
i. Relationship
between the Executant and Holder of General Power of Attorney
27.
A power of attorney derives its basic principles from Chapter X of the
Contract Act which provides for “Agency” along with Sections 1A and 2 respectively
of the Powers of Attorney Act, 1882. Agency is a fiduciary relationship
between two persons, where one explicitly or implicitly agrees that the other
will act on their behalf to influence their legal relations with third parties,
and the other similarly agrees to act in this capacity or does so based on an
agreement. The relationship between the executant of a general power of
attorney and the holder of the power is one of principal and agent. A principal
is bound by the acts done by an agent or the contracts made by him on behalf of
the principal. Likewise, power of attorney in the nature of contract of agency
authorizes the holder to do acts specified by the executant, or represent the
executant in dealings with third persons.
28.
In the case of Syed Abdul Khader v. Rami Reddy & Ors., reported in
(1979) 2 SCC 601, this Court held that the relation between the donor of the
power and the donee of the power is one of the principal and agent having its
genesis in a contract. It further observed that the term “agency” refers to the
relationship in which one person has the authority or ability to establish
legal relations between a principal and third parties. This relationship arises
when a person, known as the agent, has the authority to act on behalf of
another, called the principal, and agrees to do so. The relevant observations
are reproduced herein below:-
“10. The first
contention of the appellant is that it was impermissible in law for three
persons to jointly grant a power of attorney in favour of Defendant 34. Barring
the ipse dixit of the learned counsel nothing was shown to us to make such a
joint power impermissible in law. The relation between the donor of the power
and the donee of the power is one of the principal and agent and the expression
“agency” is used to connote the relation which exists where one person has an
authority or capacity to create legal relations between a person occupying the
position of principal and third parties. The relation of agency arises whenever
one person called the agent has authority to act on behalf of another called
the principal and consents so to act. The relationship has its genesis in a
contract. If agency is the outcome of a contract between the principal and the
agent, in order to show that three principals jointly constituting an agent by
a deed called “Power of Attorney” was impermissible, provisions
of Contract Act or the general law of contract should have been shown
as having been violated by such a contract.
Nothing of the kind was pointed out to us. On
the contrary, in Halsbury's Laws of England, Vol. I, 4th Edn., para 726, the
following proposition has been stated:
“Co-principals may
jointly appoint an agent to act for them and in such case become jointly liable
to him and may jointly issue him.” We are in agreement with this view and,
therefore, three principals could jointly appoint an agent.” (Emphasis
supplied)
29.In
State of Rajasthan v. Basant Nahata, reported in (2005) 12 SCC 77, while
dealing with the challenge to the constitutional validity of Section
22A of the Registration Act, it was held that a deed of power of attorney
is a document of convenience empowering the agent to act for the principal or
manage the affairs of the principal. The relevant observations are reproduced herein
below:
“Power of attorney
13. A grant of power
of attorney is essentially governed by Chapter X of the Contract Act. By
reason of a deed of power of attorney, an agent is formally appointed to act
for the principal in one transaction or a series of transactions or to manage
the affairs of the principal generally conferring necessary authority upon
another person. A deed of power of attorney is executed by the principal in
favour of the agent. The agent derives a right to use his name and all acts, deeds
and things done by him and subject to the limitations contained in the said
deed, the same shall be read as if done by the donor. A power of attorney is,
as is well known, a document of convenience.
14. Besides the
Contract Act, the Powers-of-Attorney Act, 1882 deals with the subject. Section
1-A of the Powers-of-Attorney Act defines power of attorney to include
any instruments empowering a specified person to act for and in the name
of the person executing it. Section 2 of the said Act reads, thus:
“2. Execution under
power of attorney.—The donee of a power of attorney may, if he thinks fit,
execute or do any instrument or thing in and with his own name and signature,
and his own seal, where sealing is required, by the authority of the donor of
the power; and every instrument and thing so executed and done, shall be as
effectual in law as if it had been executed or done by the donee of the power
in the name, and with the signature and seal, of the donor thereof.
This section applies
to powers of attorney created by instruments executed either before or after
this Act comes into force.” Execution of a deed of power of attorney,
therefore, is valid in law and subject to the provisions of the Act is not
compulsorily registerable.”
(Emphasis
supplied)
30.
From the above exposition of law, it is settled that power of attorney is a
creation of an agency by which the grantor/donor/executant authorizes the
grantee/donee/holder/attorney to do the acts specified on his behalf, which
will be binding on the executant as if the acts were done by him.
31.
In the present case, the original owner, executant of the POA, holds the
position of a principal. Whereas, the holder of the POA is an agent. There is
no gainsaying in the fact that the original owner by executing the POA dated
04.04.1986 in favour of the holder entered into a principal-agent
relationship with each other. We shall now proceed with an independent as well
as combined reading of the GPA and the agreement to sell.
ii.
Independent Reading of the General Power of Attorney and the Agreement to Sell
a. ‘Interest’ in Power of Attorney
32.
It was submitted on behalf of the appellants that the GPA read with the
agreement to sell categorically states that POA was executed for a
consideration, and the possession of the Suit Property was delivered to the
holder. It was further submitted that since both the documents were executed on
the same day, in favour of the same person, they should be read together and
construed harmoniously. It is because of this reason that POA holder (agent)
has an interest in the subject- matter of the agency and the POA is coupled
with interest which makes the agency irrevocable by virtue of Section
202 of the Contract Act.
33.
Section 201 of the Contract Act prescribes various ways of revocation of
authority given by the principal to his agent. A principal can terminate the
contract of agency unless such revocation is precluded by Section
202 of the Contract Act. Section 202 of the Contract Act, as an
exception to the general rule under Section 201, prescribes that
where an agent has himself an interest in the property which forms the
subject-matter of the agency, the agency cannot be terminated to the prejudice
of such interest unless there is an express stipulation to the contrary.
34.
Illustration (a) to Section 202 of the Contract Act states that A
(principal) has given authority to B (agent) to sell A’s land, and to pay
himself i.e., the agent, from the proceeds the debt which is due to him from A.
Illustration (b) states that A (principal) has consigned 1,000 bales of cotton
to B (agent), who has given an advance on the bales of cotton. Now, A wishes B
to sell the cotton and recover his advance from the sale proceeds. In both the
cases, A can neither revoke the authority nor agency will be terminated by his
insanity or death. It is important to take a note that in both the cases, the
agent has an interest vested in the subject- matter of the agency. The factum
of interest or security of the agent, in both cases, does not imply that the
agent’s right to remuneration constitutes an interest in the subject matter of
the agency; rather, it extends beyond the mere advancement of remuneration or
commission. Where POA is coupled with an interest, it metamorphosizes to an
irrevocable agency unless expressly stated otherwise. There an agent’s
right to remuneration is not an interest in the subject-matter of the agency.
35.Therefore,
the essentials of Section 202 of the Contract Act are, first, there
shall be a relationship in the capacity of ‘principal and agent’ between the
parties and secondly, there shall be agent’s interest in the subject-matter of
the agency. If both the conditions are fulfilled the agency becomes irrevocable
and cannot be terminated unilaterally at the behest of the principal. As the
first condition is satisfied in the present case, we shall now proceed to
examine whether from the reading of the GPA, the holder of POA had an interest
in the subject matter of the agency, namely, the Suit Property.
36.
We may quote an extract from Bowstead on Agency, 14th Edition, page 423 it
stated as under:-
“(i) Where the
authority of an agent is given by deed or for valuable consideration, for the
purpose of effectuating any security, or of protecting or securing any interest
of the agent, it is irrevocable during the subsistence of such security or
interest. But it is not irrevocable merely because the agent has an interest in
the exercise of it or has a special property in, or lien for advances upon, the
subject matter of it, the authority not being given expressly for the purpose
of securing such interest or advances;
(ii) Where a power of attorney, whenever
created is expressed to be irrevocable and is given to secure a proprietary
interest of the donee of the power, or the performance of an obligation owed to
the donee, then, so long as the donee has that interest, or the obligation
remains undischarged, the power is irrevocable;
(iii) Authority
expressed by this article to be irrevocable is not determined by the death,
insanity or bankruptcy of the principal, nor ......where the principal is an
incorporated company, but its winding up or dissolution, and cannot be revoked
by the principal without the consent of the agent.”
37.As
far back as 1931, in Dalchand v. Seth Hazarimal & Ors., reported in 1931
SCC OnLine MP 57, the defendant-agent claimed that he had an interest in the
cloth supplied to him by the plaintiff-principal for sale because according to
the agent he was entitled to keep for himself any amount obtained by him as per
the assigned rates. The court held that the agent had no interest in the
property being sold or in the proceeds of sale until sale is complete. The
relevant observations are reproduced herein below:-
“5. For the plaintiff,
Vishnucharya v. Ramchandra [[1881] 5 Bom. 253.], has been cited, in which it
has been held that an agent for the collection of rents cannot be regarded as having
an interest in the property merely because he is authorized to take his salary
out of the rents. It is objected on behalf of the defendants that this decision
runs directly contrary to Illus. (a), S. 202. But I find that a similar
view has been taken in Lakhmiohand v. Chotooram [[1900] 24 Bom. 403.], in which
the facts more closely resemble those of the present case and it was held that
the interest which an agent has in effecting a sale and the prospect of
remuneration to arise therefrom is not such an interest as would prevent the
termination of the agency.
6. I am in respectful
agreement with the decisions in these two Bombay cases. They and the case
before me are clearly distinguishable from the case stated in Illus.
(a), Section 202 of the Contract Act. In the illustration, the
principal was under a liability to the agent quite apart from the contract of
agency, and the authority given to him to sell the principal’s land was by way
of security for the discharge of that liability. In the present case, the agent
had no interest in the property to be sold or in the sale proceeds thereof
until a sale had been actually effected, and revocation of the agency, before
sale had been effected, deprived him of nothing that had accrued to him.”
(Emphasis supplied)
38.
In the case of Palani Vannan v. Krishnaswami Konar, reported in 1945 SCC
OnLine Mad 119, the decree-holder had executed a POA authorizing the holder to
execute the decree. Later, the executant revoked the POA through a notice. The
question before the court was whether the notice revoking the authority was
valid in law or not. The court held that the POA was not coupled with interest
as the object of the POA was not securing any interest of the agent. It held
that the primary object of the POA was to recover the fruits of the decree on
behalf of the principal despite the fact that the agent’s remuneration was
fixed to be drawn from the proceeds of the decree. The relevant observations
are reproduced herein below:
“It is only necessary to refer to one further
decision, Frith v. Frith [[1906] A.C. 254.], in which the Judicial Committee
discuss the general position relating to these matters. Their Lordships point
out that in what is known as Carmichael's case [[1896] 2 Ch. 643.]:
“The donor of the power,
for valuable consideration, conferred upon the donee, authority to do a
particular thing in which the latter had an interest, namely, to apply for the
shares of the Company which the donee was promoting for the purpose of
purchasing his own property from him, and the donor sought to revoke that
authority before the benefit was reaped.” The effect of all these cases appears
to be stated accurately in Bowstead on the Law of Agency, Eighth Edition, page 456.
It is stated (Article 138):
“Where the authority
of an agent is given for the purpose of effectuating any security, or of
protecting or securing any interest of the agent, it is irrevocable during the
subsistence of such security or interest.”
--xxx--
My view of this
document is as follows. I think its primary object was to recover on behalf of
the principal the fruits of his decree. It contained incidentally a provision
for the employment of the agent, Vedavyasachar, in order to realize that
decree. It provides that his remuneration is to be one-half of the proceeds. It
contains an indemnity clause against any out-of-pocket expenses which he is
entitled also to recover from the amount of the decree. But the object of the
power-of-attorney is not for the purpose of protecting or securing any interest
of the agent. I think that part of the agreement is purely incidental. There
is, however, another feature of this document which seems to me to be
conclusive against the appellants. The last words, “I shall not for any
reason whatever, cancel without your permission this authority which I have
given to you, without paying the amount expended by you and without giving the
aforesaid relief for your trouble”, seem to me to make express provision for
the revocation of the above power. It can be done in two ways, (a) by consent,
for that is what I understand “your permission” to mean, and (b) if that
permission is withheld, on payment by the principal of all out-of-pocket
expenses and also remuneration for his services. With regard to remuneration,
the wording is vague, “without giving the aforesaid relief for your trouble”.
(Emphasis
supplied)
39.To
the same effect is the decision of High Court of Delhi in Shri Harbans
Singh v. Smt. Shanti Devi, reported in 1977 SCC OnLine Del 102. The High Court
while dealing with the question of whether the powers of attorney executed by
the appellant were cancelled validly, laid down the conditions of
irrevocability of a contract of agency as, (i) authority to agent given for
valuable consideration;
(ii) such valuable
consideration was given for the purpose of effectuating a security or
protecting or securing the interest of the agent; (iii) agency not being
irrevocable merely because the agent has some interest in carrying it out or
holds a special right, such as a lien or advance, over its subject matter.
Thus, the agency has to be specifically meant to secure the agent’s benefit or
interest. It further observed that the interest of the agent can be
inferred from the language of the document or from the course of business
between the principal and agent. The observations are reproduced herein below:-
“All the conditions of
irrevocability are satisfied in the present case. The authority to the agent
was given for valuable consideration which proceeded from the respondent. It
was given for the purpose of effectuating a security or protecting or securing
the interest of the agent. For, the only purpose of the agency was to ensure
and secure the performance of the contract by the appellant in favour of the
respondent for whom Shri Gulati was acting as the husband and the nominee and,
therefore, a representative or an agent. Where the performance of the agency is
not to secure the interest or the benefit of the agent then the agency is not
irrevocable merely because the agent has an interest in the exercise of it or
has a special property in or lien for advances upon the subject-matter of it.”
(Emphasis
supplied)
40.
In the present case, it is evident from para 1 of the GPA executed by the
original owner in favor of the holder that the POA was to look after, maintain,
manage the Scheduled Property. Para 2 states that the attorney can enter into
any agreement with any person with respect to the Scheduled Property for any
amount, receive advance amount, to execute deeds in favor of such persons,
issue proper discharge. Para 3 states that attorney has the power to apply for
transfer of khata and to pay all future taxes and receive receipts. Further, para
4 states that the attorney can apply for sanctioning of plan for the
purpose of construction, utilize the Scheduled Property as the holder deems fit
and receive all profits therefrom. Para 5 states that the attorney has the
power to represent the holder in all Government Offices and do all things
connected. Para 6 states that the attorney can pursue matters in courts, give
evidence, obtain decree, execute the same. Further, para 7 states that the
Scheduled Property is in owner’s peaceful possession and enjoyment. Lastly,
para 8 states that the attorney is generally entitled to do all acts required
in respect of the Suit Property which are not specifically mentioned and that
the GPA is irrevocable. b. Nature of Power of Attorney
41.
It is now appropriate to analyze the nature of the GPA, specifically whether it
is general or special. While construing a document, a reader should not go by
the title to the document or the nomenclature of the document. In such a case,
the court is endowed with a duty to see the contents of the document and
intention of the parties which can be gathered from the terms of the document
and/or from circumstances under which the document was entered into. The
intention of the parties can be ascertained from the language used by the
parties. A document has to be seen as a whole.
42.
The import of the word “general” in a POA refers to the power granted
concerning the subject matter. The test to determine the nature of POA is the
subject matter for which it has been executed. The nomenclature of the POA does
not determine its nature. Even a POA termed as a ‘general power of attorney’
may confer powers that are special in relation to the subject matter. Likewise,
a ‘special power of attorney’ may confer powers that are general in nature
concerning the subject matter. The essence lies in the power and not in the
subject-matter.
43.
In Halsbury, Vol. 1, at page 151, the author defines special and general
agents, the definition of general agent has been stated as follows:
“A general agent is
one who has authority, arising out of and in the ordinary course of his
business or profession, to do some act or acts on behalf of his principal in
relation thereto; or one who is authorised to act on behalf of the principal
generally in transactions of a particular kind or incidental to a particular
business.”
44.A
three-Judge Bench of this Court settled the rules of interpretation applicable
to power of attorney in Timblo Irmaos Ltd., Margo v. Jorge Anibal Matos
Sequeira, reported in (1977) 3 SCC 474. It was held that words used in a POA
must be interpreted in the context of the whole; the purpose of the
powers conferred must then be examined through the circumstances in which
it was executed; and finally, necessary powers must be implied. The relevant
observations are reproduced herein below:-
“11. We think that
perhaps the most important factor in interpreting a power of attorney is the
purpose for which it is executed. It is evident that the purpose for which it
is executed must appear primarily from the terms of the power of attorney
itself, and, it is only if there is an unresolved problem left by the language
of the document, that we need consider the manner in which the words used could
be related to the facts and circumstances of the case or the nature or course
of dealings. We think that the rule of construction embodied in proviso 6
to Section 92 of the Evidence Act, which enables the Court to examine
the facts and surrounding circumstances to which the language of the document
may be related, is applicable here, because we think that the words of the
document, taken by themselves, are not so clear in their meanings as the
learned Judicial Commissioner thought they were.
--xxx--
13. The learned
Judicial Commissioner had, in our opinion, overlooked several well-known rules
of interpretation: firstly, that, a word used in a document has to be
interpreted as a part of or in the context of the whole; secondly, that, the
purpose of the powers conferred by the power of attorney have to be ascertained
having regard to the need which gave rise to the execution of the document, the
practice of the parties, and the manner in which the parties themselves
understood the purpose of the document; and, thirdly, that, powers which are absolutely
necessary and incidental to the execution of the ascertained objects of
the general powers given must be necessarily implied.”
(Emphasis
supplied)
45.
Further, a mere use of the word ‘irrevocable’ in a POA does not make the POA
irrevocable. If the POA is not coupled with interest, no extraneous expression
can make it irrevocable. At the same time, even if there is no expression to
the effect that the POA is irrevocable but the reading of the document
indicates that it is a POA coupled with interest, it would be irrevocable. The
principles of construction of a POA termed as ‘irrevocable’ was explained in
Manubhai Prabhudas Patel v. Jayantilal Vadilal Shah, reported in 2011 SCC
OnLine Guj 7028. The relevant observations are reproduced below:-
“12. I am of the view
that while construing a document, it is necessary to determine the real
intention of the parties. The mere form in which document is couched is
immaterial. The intention of the parties has to be gathered from the terms of
the documents themselves and from such of the surrounding circumstances, as
later required to show in what manner the language of the document is related
to the existing fact. It is very difficult task to know the intention of the
parties on the basis of the recital of the document. But, the Court can rely
safely on the language of the document, the language, which has been used by
the parties to manifest the intention of the parties. If the Court goes on
extraneous evidence, that may lead to more difficulty and confusion. But, there
are certain principles to be borne in mind. The first principle is, the mere
saying that the power of attorney is an irrevocable power of attorney coupled
with interest is not the end of the matter. The Court, can clearly say
that the document, though, is styled as an irrevocable power of attorney is not
in substance a power coupled with interest so as to make it an irrevocable
power of attorney. At the same time, even if there is no title to show that the
power is an irrevocable power, but, the substance of the entire document would
suggest that the same is an irrevocable power coupled with interest. Therefore,
a document has to be construed as a whole. A stray sentence here and there
cannot be picked out to construe a document. To understand the tenor of the
document and the intention of the parties, it has to be read as a whole. The
real intention of the parties has to be covered not merely from what ex-facie
is stated in the document, but, from the totality of the recitals in the
document. At this stage, I may quote with profit a very lucid judgment rendered
by learned Single Judge of Madras High Court explaining the general principles
regarding the construction of power of attorney. In case of Anantha
Pillai v. Ratiinasabapatiiy Mudaliar, reported in 1968 (2) MLJ 574, Ismail, J.
(as he then was), held thus:
“The general
principles regarding the construction of power of attorney are well settled.
Powers of attorney must be strictly construed as giving only such authority as
they confer expressly or by necessary implication. Where an act purporting to
be done under the power of attorney is challenged as being in excess of the
power, it is necessary to show that on a fair construction of the whole
instrument the authority in question is to be found within the four corners of
the instrument either by express terms or by necessary implication. Some of the
principles governing the construction of a power of attorney are:(1) the
operative part of the deed is controlled by the recitals, (2) where an authority
is given to do particular acts, followed by general words, the general words
are restricted to what is necessary for the performance of the particular acts,
(3) the general words do not confer general powers but are limited to the
purpose for which the authority is given and are construed as enlarging the
special powers only when necessary for that purpose; (4) a power of
attorney is construed so as to include all medium powers necessary for its
effective execution. Bearing these general principles in mind the question for
consideration is whether the power of attorney in this case authorised the
first defendant to enter into an agreement to sell or authorised him to execute
a sale-deed….””
(Emphasis
supplied)
46.
Applying the above exposition of law in the facts of the present case, it is
evident from the tenor of POA that is not irrevocable as it was not executed to
effectuate security or to secure interest of the agent. The holder of POA could
not be said to have an interest in the subject-matter of the agency and mere
use of the word ‘irrevocable’ in a POA would not make the POA irrevocable. The
High Court was right in holding that the holder did not have any interest in
the POA. When the High Court observes that the power of attorney does not
explicitly state the reason for its execution, it implies that its nature is
general rather than special.
47.
It is a settled law that a transfer of immovable property by way of sale can
only be by a deed of conveyance. An agreement to sell is not a conveyance. It
is not a document of title or a deed of transfer of deed of transfer of
property and does not confer ownership right or title. In Suraj
Lamp (supra) this Court had reiterated that an agreement to sell does
not meet the requirements of Sections 54 and 55 of the TPA
to effectuate a ‘transfer’.
48.
From the independent reading of the POA and the agreement to sell, the
submissions of the appellants fail on two grounds, first, the POA is general in
nature and does not secure agent’s right in the subject-matter of the agency,
and secondly, an agreement to sell simpliciter does not confer ownership in the
immovable property so as to transfer a better title to anyone else. iii.
Combined Reading of the General Power of Attorney and the Agreement to Sell
49.
The issue at hand may also be looked at from another angle. The appellants have
submitted that that since the GPA and the agreement to sell were executed by
the same person in favour of the same beneficiary, it ought to have been read
together.
50.
Here, we deem it appropriate to take note of Sections
17 and 49 of the Registration Act respectively. The provisions
have been reproduced herein below:-
“17. Documents of
which registration is compulsory.—(1) The following documents shall be
registered, if the property to which they relate is situate in a district in
which, and if they have been executed on or after the date on which, Act
No. XVI of 1864, or the Indian Registration Act, 1866, or the Indian Registration
Act, 1871, or the Indian Registration Act, 1877, or this Act came or comes
into force, namely:—
(a) instruments of
gift of immovable property;
(b) other
non-testamentary instruments which purport or operate to create, declare,
assign, limit or extinguish, whether in present or in future, any right, title
or interest, whether vested or contingent, of the value of one hundred rupees
and upwards, to or in immovable property;
(c) non-testamentary
instruments which acknowledge the receipt or payment of any consideration on
account of the creation, declaration, assignment, limitation or extinction of
any such right, title or interest; and
(d) leases of
immovable property from year to year, or for any term exceeding one year, or
reserving a yearly rent;
(e) non-testamentary
instruments transferring or assigning any decree or order of a Court or any
award when such decree or order or award purports or operates to create,
declare, assign, limit or extinguish, whether in present or in future, any right,
title or interest, whether vested or contingent, of the value of one hundred
rupees and upwards, to or in immovable property:
Provided that the
[State Government] may, by order published in the [Official Gazette], exempt
from the operation of this sub-section any lease executed in any district, or
part of a district, the terms granted by which do not exceed five years and the
annual rents reserved by which do not exceed fifty rupees.
(1A) The documents
containing contracts to transfer for consideration, any immovable property for
the purpose of section 53A of the Transfer of Property Act, 1882 (4
of 1882) shall be registered if they have been executed on or after the
commencement of the Registration and Other Related laws (Amendment) Act,
2001 (48 of 2001) and if such documents are not registered on or after
such commencement, then, they shall have no effect for the purposes of the said
section 53A.
(2)
Nothing in clauses (b) and (c) of sub-section (1) applies to—
(i) any composition
deed; or
(ii) any instrument
relating to shares in a joint stock Company, notwithstanding that the assets of
such Company consist in whole or in part of immovable property; or
(iii) any debenture
issued by any such Company and not creating, declaring, assigning, limiting or
extinguishing any right, title or interest, to or in immovable property except
in so far as it entitles the holder to the security afforded by a registered
instrument whereby the Company has mortgaged, conveyed or otherwise transferred
the whole or part of its immovable property or any interest therein to trustees
upon trust for the benefit of the holders of such debentures; or
(iv) any endorsement
upon or transfer of any debenture issued by any such Company; or
(v) any document other
than the documents specified in sub-section (1A) not itself creating,
declaring, assigning, limiting or extinguishing any right, title or interest of
the value of one hundred rupees and upwards to or in immovable property, but
merely creating a right to obtain another document which will, when executed,
create, declare, assign, limit or extinguish any such right, title or interest;
or
(vi) any decree or
order of a Court [except a decree or order expressed to be made on a compromise
and comprising immovable property other than that which is the subject-matter
of the suit or proceeding]; or
(vii) any grant of immovable property by
[Government]; or
(viii) any instrument
of partition made by a Revenue- Officer; or
(ix) any order
granting a loan or instrument of collateral security granted under the Land
Improvement Act, 1871, or the Land Improvement Loans Act, 1883; or
(x) any order granting
a loan under the Agriculturists, Loans Act, 1884, or instrument for
securing the repayment of a loan made under that Act; or (xa) any order made
under the Charitable Endowments Act, 1890 (6 of 1890), vesting any
property in a Treasurer of Charitable Endowments or divesting any such
Treasurer of any property; or
(xi) any endorsement
on a mortgage-deed acknowledging the payment of the whole or any part of the
mortgage-money, and any other receipt for payment of money due under a mortgage
when the receipt does not purport to extinguish the mortgage; or
(xii) any certificate
of sale granted to the purchaser of any property sold by public auction by a
Civil or Revenue-Officer.
Explanation.—A
document purporting or operating to effect a contract for the sale of immovable
property shall not be deemed to require or ever to have required registration
by reason only of the fact that such document contains a recital of the payment
of any earnest money or of the whole or any part of the purchase money.
(3) Authorities to
adopt a son, executed after the 1st day of January, 1872, and not conferred by
a will, shall also be registered.”
--xxx--
49. Effect of
non-registration of documents required to be registered.—No document required
by section 17 [or by any provision of the Transfer of
Property Act, 1882 (4 of 1882)], to be registered shall—
(a) affect any
immovable property comprised therein, or
(b) confer any power
to adopt, or
(c) be received as
evidence of any transaction affecting such property or conferring such power,
unless it has been registered:
[Provided that an
unregistered document affecting immovable property and required by this Act or
the Transfer of Property Act, 1882 (4 of 1882), to be registered may
be received as evidence of a contract in a suit for specific performance under
Chapter II of the Specific Relief Act, 1877 (3 of 1877) *** or as evidence of
any collateral transaction not required to be effected by registered
instrument.]”
51.Section
17(1)(b) prescribes that any document which purports or intends to create,
declare, assign, limit or extinguish any right, title or interest, whether
vested or contingent, of the value of one hundred rupees and upwards to or in
immovable property is compulsorily registerable. Whereas, Section
49 prescribes that the documents which are required to be registered
under Section 17 will not affect any immovable property unless it has
been registered.
52.The
aforesaid has been emphatically laid down by this Court in Shyam
Narayan Prasad v. Krishna Prasad & Ors., reported in (2018) 7 SCC 646. The
relevant observations are reproduced herein below:-
“20. Section
17(1)(b) of the Registration Act mandates that any document which has the
effect of creating and taking away the rights in respect of an immovable
property must be registered and Section 49 of the Registration Act
imposes bar on the admissibility of an unregistered document and deals
with the documents that are required to be registered under Section
17 of the Registration Act. Since, the deed of exchange has the effect of
creating and taking away the rights in respect of an immovable property, namely,
RCC building, it requires registration under Section 17. Since the deed of
exchange has not been registered, it cannot be taken into account to the extent
of the transfer of an immovable property.”
(Emphasis
supplied)
53.
Even from the combined reading of the POA and the agreement to sell, the
submission of the appellants fails as combined reading of the two documents
would mean that by executing the POA along with agreement to sell, the holder
had an interest in the immovable property. If interest had been transferred by
way of a written document, it had to be compulsorily registered as
per Section 17(1)(b) of the Registration Act. The law recognizes two
modes of transfer by sale, first, through a registered instrument, and second,
by delivery of property if its value is less than Rs. 100/-.
54.
This principle was recently elaborated by the High Court of Karnataka in
Channegowda & Anr. v. N.S. Vishwanath & Ors., reported in 2023 SCC
OnLine Kar 153. The relevant portion is reproduced as under:-
“14. An attempt is
made on behalf of the plaintiffs to contend that the second plaintiff has sold
the property as a General Power of Attorney Holder and not as a title holder.
It is argued that the
Power of attorney is not compulsorily registrable. The submission is noted with
care. Suffice it to note that a deed of power of attorney is not one of the
instruments specified under Section 17 of the Registration Act
compulsorily registrable. However, if a power has been created empowering the
attorney to sell the property i.e., if a document that gives a right to the
attorney holder to sell the immovable property, then it would be a document
creating an interest in immovable property, which would require compulsory
registration. In the present case, the General Power of Attorney alleged to
have been executed by defendants 1 to 3 in favor of the second plaintiff is
coupled with interest i.e., power of alienation is conferred but it is not
registered. The Apex Court in the SURAJ LAMP's case has held that the
General Power of Attorney Sale, or Sale Agreements/Will do not convey title and
do not amount to transfer, nor can they be considered valid modes of transfer
of immovable property. Therefore, it can be safely concluded that the
declaration of facts/statement of facts (affidavit) and General Power of
Attorney do not convey title. They are inadmissible in evidence.”
(Emphasis
supplied)
55.
The High Court rightly held that even though the GPA and the agreement to sell
were contemporaneous documents executed by the original owner in favour of the
holder, this alone cannot be a factor to reach the conclusion that she had an
interest in the POA. Thus, even though the GPA and the agreement to sell were
contemporaneous documents executed by the original owner in favour of the same
beneficiary, this cannot be the sole factor to conclude that she had an
interest in the subject-matter. Even if such an argument were to persuade this
Court, the document must have been registered as per Section 17(1)(b) of
the Registration Act. In the absence of such registration, it would not be open
for the holder of the POA to content that she had a valid right, title and
interest in the immovable property to execute the registered sale deed in
favour of appellant no. 2.
56.The
practice of transferring an immovable property vide a GPA and agreement to sell
has been discouraged by the following observations of this Court in Suraj
Lamp (supra). The relevant observations are reproduced herein below:-
“24. We therefore
reiterate that immovable property can be legally and lawfully
transferred/conveyed only by a registered deed of conveyance. Transactions of
the nature of “GPA sales” or “SA/GPA/will transfers” do not convey title and do
not amount to transfer, nor can they be recognised or valid mode of transfer of
immovable property. The courts will not treat such transactions as completed or
concluded transfers or as conveyances as they neither convey title nor create
any interest in an immovable property. They cannot be recognised as deeds of
title, except to the limited extent of Section 53-A of the TP Act.
Such transactions cannot be relied upon or made the basis for mutations in
municipal or revenue records. What is stated above will apply not only to deeds
of conveyance in regard to freehold property but also to transfer of leasehold
property. A lease can be validly transferred only under a registered assignment
of lease. It is time that an end is put to the pernicious practice of
SA/GPA/will transactions known as GPA sales.”
(Emphasis
supplied)
iv.
Effect of Suit for Injunction simpliciter
57.
The appellants submitted that the answering respondent had not challenged the
validity of the GPA and the agreement to sell dated 04.04.1986 executed in
favour of the holder and registered sale deed dated 01.04.1998 executed in
favour of appellant no. 2. The appellants’ submission does not hold good, as
the absence of a separate suit for declaration or even a specific prayer to
that effect does not alter the legal position of either party in the facts of
this case. The legal standing of both parties remains unaffected, for want of a
distinct challenge to the instruments in question.
58.
Where the question of title is “directly and substantially” in issue in a suit
for injunction, and where a finding on an issue of title is necessary for
granting the injunction, with a specific issue on title raised and framed, a
specific prayer for a declaration of title is not necessary. As a result, a
second suit would be barred when facts regarding title have been pleaded and
decided by the Trial Court. In the present suit, the findings on possession
rest solely on the findings on title. The Trial Court framed a categorical
issue on the ownership of the appellants herein.
To
summarize, where a finding on title is necessary for granting an
injunction and has been substantially dealt with by the Trial Court in a
suit for injunction, a direct and specific prayer for a declaration of title is
not a necessity.
59.
Where a finding on an issue of title is not necessary for deciding the question
of possession and the grant of an injunction, or where no issue on title has
been framed to decide a suit for injunction, any observation or decision on
title would be incidental and collateral and will not operate as res judicata.
However, findings on an issue of title in an earlier suit will operate as res
judicata in a subsequent suit where the question of title is directly and
substantially in issue in a suit for injunction.
60.
In the case of Sajjadanashin Sayed MD. B.E. EDR. (Dead) by LRS. v. Musa
Dadabhai Ummer, reported in (2000) 3 SCC 350, this Court laid down the test to
decide when a case will fall in “directly and substantially in issue” or
“collaterally or incidentally in issue”. The relevant observations are
reproduced herein below:-
“24. Before parting
with this point, we would like to refer to two more
rulings. In Sulochana Amma v. Narayanan Nair [(1994) 2 SCC 14]
this Court held that a finding as to title given in an earlier injunction suit
would be res judicata in a subsequent suit on title. On the other hand,
the Madras High Court, in Vanagiri Sri Selliamman
Ayyanar Uthirasomasundareswarar Temple v. Rajanga Asari [AIR 1965 Mad
355 : ILR (1965) 1 Mad 232] held (see para 8 therein) that the previous suit
was only for injunction relating to the crops. Maybe, the question of title was
decided, though not raised in the plaint. In the latter suit on title, the
finding in the earlier suit on title would not be res judicata as the earlier
suit was concerned only with a possessory right. These two decisions, in our
opinion, cannot be treated as being contrary to each other but should be
understood in the context of the tests referred to above. Each of them can
perhaps be treated as correct if they are understood in the light of the tests
stated above. In the first case decided by this Court, it is to be assumed that
the tests above-referred to were satisfied for holding that the finding as to
possession was substantially rested on title upon which a finding was felt
necessary and in the latter case decided by the Madras High Court, it must be
assumed that the tests were not satisfied. As stated in Mulla, it all depends
on the facts of each case and whether the finding as to title was treated as
necessary for grant of an injunction in the earlier suit and was also the
substantive basis for grant of injunction. In this context, we may refer to
Corpus Juris Secundum (Vol. 50, para 735, p. 229) where a similar aspect in
regard to findings on possession and incidental findings on title were dealt
with. It is stated:
“Where title to
property is the basis of the right of possession, a decision on the question of
possession is res judicata on the question of title to the extent that
adjudication of title was essential to the judgment; but where the question of
the right to possession was the only issue actually or necessarily involved,
the judgment is not conclusive on the question of ownership or title.””
(Emphasis
supplied)
61.
In Anathula Sudhakar v. P. Buchi Reddy (Dead) by LRs., reported in (2008) 4 SCC
594, this Court expounded upon the question whether a finding regarding title
could be recorded in a suit for injunction. The relevant observations are being
reproduced below:-
“21. To summarise, the
position in regard to suits for prohibitory injunction relating to immovable
property, is as under:
(a) Where a cloud is
raised over the plaintiff's title and he does not have possession, a suit for
declaration and possession, with or without a consequential injunction, is the
remedy. Where the plaintiff's title is not in dispute or under a cloud, but he
is out of possession, he has to sue for possession with a consequential
injunction. Where there is merely an interference with the plaintiff's lawful
possession or threat of dispossession, it is sufficient to sue for an
injunction simpliciter.
(b) As a suit for
injunction simpliciter is concerned only with possession, normally the issue of
title will not be directly and substantially in issue. The prayer for
injunction will be decided with reference to the finding on possession. But in
cases where de jure possession has to be established on the basis of title to
the property, as in the case of vacant sites, the issue of title may directly
and substantially arise for consideration, as without a finding thereon, it
will not be possible to decide the issue of possession.
(c) But a finding on
title cannot be recorded in a suit for injunction, unless there are necessary
pleadings and appropriate issue regarding title (either specific, or implied as
noticed in Annaimuthu Thevar [Annaimuthu Thevar v. Alagammal, (2005) 6 SCC
202] ). Where the averments regarding title are absent in a plaint and where
there is no issue relating to title, the court will not investigate or examine
or render a finding on a question of title, in a suit for injunction. Even
where there are necessary pleadings and issue, if the matter involves complicated
questions of fact and law relating to title, the court will relegate the
parties to the remedy by way of comprehensive suit for declaration of title,
instead of deciding the issue in a suit for mere injunction.
(d) Where there are
necessary pleadings regarding title, and appropriate issue relating to title on
which parties lead evidence, if the matter involved is simple and
straightforward, the court may decide upon the issue regarding title, even in a
suit for injunction. But such cases, are the exception to the normal rule that
question of title will not be decided in suits for injunction. But persons
having clear title and possession suing for injunction, should not be driven to
the costlier and more cumbersome remedy of a suit for declaration, merely because
some meddler vexatiously or wrongfully makes a claim or tries to encroach upon
his property. The court should use its discretion carefully to identify cases
where it will enquire into title and cases where it will refer to the plaintiff
to a more comprehensive declaratory suit, depending upon the facts of the
case.” (Emphasis supplied)
62.
We are conscious of the fact that the holder of POA did not choose to register
the agreement to sell executed by the original owner in her favour. On this, we
would like to underscore the observations of this Court on the objective and
advantages of registration in Suraj Lamp (supra). The relevant
excerpt has been reproduced herein below:-
“Advantages of
registration
15. In the earlier order dated 15-5-2009
[(2009) 7 SCC 363 : (2009) 3 SCC (Civ) 126] , the objects and benefits of
registration were explained and we extract them for ready reference: (SCC p.
367, paras 15-18) “15. The Registration Act, 1908 was enacted with
the intention of providing orderliness, discipline and public notice in regard
to transactions relating to immovable property and protection from fraud and
forgery of documents of transfer. This is achieved by requiring compulsory
registration of certain types of documents and providing for consequences of
non-registration.
16. Section
17 of the Registration Act clearly provides that any document (other than
testamentary instruments) which purports or operates to create, declare,
assign, limit or extinguish whether in present or in future ‘any right, title
or interest’ whether vested or contingent of the value of Rs 100 and upwards to
or in immovable property.
17. Section
49 of the said Act provides that no document required by Section
17 to be registered shall, affect any immovable property comprised therein
or received as evidence of any transaction affected such property, unless it
has been registered. Registration of a document gives notice to the world that
such a document has been executed.
18. Registration
provides safety and security to transactions relating to immovable property,
even if the document is lost or destroyed. It gives publicity and public
exposure to documents thereby preventing forgeries and frauds in regard to
transactions and execution of documents. Registration provides information to
people who may deal with a property, as to the nature and extent of the rights
which persons may have, affecting that property. In other words, it enables
people to find out whether any particular property with which they are
concerned, has been subjected to any legal obligation or liability and who
is or are the person(s) presently having right, title, and interest in the
property. It gives solemnity of form and perpetuate documents which are of
legal importance or relevance by recording them, where people may see the
record and enquire and ascertain what the particulars are and as far as land is
concerned what obligations exist with regard to them. It ensures that every
person dealing with immovable property can rely with confidence upon the
statements contained in the registers (maintained under the said Act) as a full
and complete account of all transactions by which the title to the property may
be affected and secure extracts/copies duly certified.” Registration of
documents makes the process of verification and certification of title easier
and simpler. It reduces disputes and litigations to a large extent.”
(Emphasis
supplied)
G.
CONCLUSION
63.
For all the aforesaid reasons, we have reached the conclusion that no error not
to speak of any error of law could be said to have been committed by the High
Court in passing the impugned judgment.
64.
As a result, the appeals stand dismissed. Parties shall bear their own costs.
Pending application(s), if any, stand disposed of.
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