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SUPREME COURT OF INDIA
HEMANT GUPTA, V. RAMASUBRAMANIAN, JJ.
Mrs. Umadevi Nambiar - Appellant
Versus
Thamarasseri Roman Catholic Diocese Rep. by its Procurator Devssia’s Son Rev. Father Joseph Kappil - Respondent
Civil Appeal No. 2592 of 2022 (Arising out of Special Leave Petition (C) No.20047 of 2017)
Decided On : 01-04-2022
(A) Transfer of Property Act, 1882 – Section 41 – Transfer by ostensible owner – Partition of property – It is not always necessary for a plaintiff in a suit for partition to seek cancellation of alienations – There are several reasons behind this principle – One is that alienees as well as co-sharer are still entitled to sustain alienation to the extent of share of co-sharer – It may also be open to alienee, in final decree proceedings, to seek allotment of transferred property, to share of transferor, so that equities are worked out in a fair manner – Reasoning given by High Court for holding that appellant ought to have challenged alienations, is that appellant was out of possession – High Court failed to appreciate that possession of an agent under a deed of Power of Attorney is also possession of Principal and that any unauthorized sale made by agent will not tantamount to Principal parting with possession – High Court was wrong in putting against appellant, her failure to challenge alienations – Deed of Power of Attorney did not contain a clause authorizing agent to sell property though it contained two express provisions, one for leasing out property and another for executing necessary documents if a security had to be offered for any borrowal made by agent – By convoluted logic, punctuation marks cannot be made to convey a power of sale – No one can confer a better title than what he himself has – Appellant’s sister did not have power to sell property to vendors of respondent – Vendors of respondent could not have derived any valid title to property – If vendors of respondent themselves did not have any title, they had nothing to convey to respondent – Impugned judgment of High Court set aside and Judgment and preliminary decree passed by trial Court restored. (Paras 14, 15, 17, 19 and 20)
(B) Registration Act, 1908 – Section 49 – Power of Attorney – Ordinarily, a Power of Attorney is to be construed strictly by Court – Document should expressly authorize agent, (i) to execute a sale deed; (ii) to present it for registration; and (iii) to admit execution before Registering Authority. (Paras 17 and 18)
Facts of the case:
Their suit for partition having been decreed by the trial Court but reversed by the High Court in a regular first appeal, plaintiffs have come up with instant appeal.
Findings of Court:
The reasoning given by the High Court for holding that appellant ought to have challenged the alienations, is that the appellant was out of possession. Here again, the High Court failed to appreciate that the possession of an agent under a deed of Power of Attorney is also the possession of the Principal and that any unauthorized sale made by the agent will not tantamount to Principal parting with possession.
Result : Appeal allowed.
Key Points: - The Court held that it is not always necessary for a plaintiff in a partition suit to seek cancellation of alienations. (!) - The deed of Power of Attorney did not contain an express power of sale; thus, an agent cannot be presumed to have authority to sell, and punctuation cannot confer such authority. (!) (!) - The High Court erred in attributing constructive notice to the appellant under Section 3 of the Act; possession of an agent under a Power of Attorney is possession of the principal. (!) - Section 41 of the Transfer of Property Act requires reasonable care by the transferee to ascertain the power to transfer; if no power to sell exists, the transferee cannot rely on Section 41. (!) (!) - A person cannot derive title through an agent who did not have power to alienate; no one can confer a better title than what the transferor had. (!) - The appeal was allowed; the High Court judgment set aside and trial Court decree restored. (!) - The principle that alienees and co-sharers may sustain alienations to the extent of the co-sharer’s share. (!) - The doctrine Nemo dat quod non habet applies to prevent transfer of title by unauthorized alienations. (!) - The interpretation emphasizes that a Power of Attorney requires explicit authorization to sell; mere clauses about leases or security do not grant sale power. (!) (!)
JUDGMENT :
V. Ramasubramanian, J.
1. Their suit for partition having been decreed by the trial Court but reversed by the High Court in a regular first appeal, the plaintiffs have come up with the above appeal.
2. We have heard Shri Dushyant A. Dave, learned senior counsel for the appellant and Shri Thomas P. Joseph, learned counsel for the respondent.
3. The suit schedule property originally belonged to one Ullattukandiyil Sankunni. After his death, the property devolved upon his two daughters, one of whom is the appellant herein. The appellant herein executed a general Power of Attorney on 21.07.1971, registered as Document No.35 of 1971, in favour of her sister Smt. Ranee Sidhan. However, the said power was cancelled on 31.01.1985. But in the meantime, the appellant’s sister was found to have executed four different documents in favour of certain third parties, assigning/releasing some properties. Therefore, the appellant first filed a suit in O.S.No.16 of 1986 followed by another suit in O.S.No.27 of 1988 against the assignees/releasees. Though a preliminary decree was passed in the second suit on 7.01.1989, the appellant came to know later that the assignees/releasees had sold the property to the respondent herein.
4. Therefore, the appellant filed yet another suit in O.S No.130 of 1989, seeking partition and separate possession of her half share in the suit property. The trial Court granted a preliminary decree in favour of the appellant. However, the regular appeal filed by the respondent herein was allowed by a Division Bench of the High Court by the judgment and decree impugned in this appeal. Therefore, the appellant has come up with the above appeal.
5. At the outset, it should be stated that the respondent herein did not dispute the fact that the suit schedule property originally belonged to the father of the appellant and her sister and that the appellant and her sister were entitled to equal shares in the property. But the respondent contested the suit on the grounds inter alia (i) that in view of two prior suits for partition, namely, O.S. No.16 of 1986 and O.S.No.27 of 1988, the suit was barred under Order II Rule 2 of CPC; (ii) that the general Power of Attorney executed by the appellant in favour of her sister, authorized the agent to sign all documents and present them for registration; (iii) that by virtue of the said power, the appellant’s sister transferred the suit schedule properly to four persons, for the purpose of discharging the debts incurred in the family business; (iv) that those transferees, in turn, sold the property to the respondent herein for a valuable consideration; (v) that though the appellant was earlier residing in England, she came back to India and was staying in a house just 1 km. away from the plaint schedule property; (vi) that the appellant was therefore aware of all the transfers including the transfer in favour of the respondent and the development made by the respondent over the suit property; (vii) that, therefore, the appellant is guilty of acquiescence; and (viii) that the respondent has actually developed a commercial complex on the suit property and hence entitled at least to the value of improvements, in the event of a decree being passed.
6. The trial Court framed as many as 23 issues for consideration in the suit. The objection on the basis of Order II Rule 2 of CPC was rejected by the trial Court on the ground that the appellant’s sister had committed a fraud and that the cause of action for the present suit was different from the cause of action for the previous suits. The contention that the appellant was guilty of acquiescence was rejected by the trial Court on a factual finding that the appellant was not aware of the transfer. On an examination of the recitals contained in the Power of Attorney, the trial Court came to the conclusion that the document did not confer any power to sell the property and that, therefore, the appellant’s sister was not entitled to alienate the
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