Unilateral cancellation of property sale documents is not valid under the Indian Contract Act and Transfer of Property Act.

VALMIKI J. MEHTA, J.

C.M. Appl. Nos. 20929-30/2017 (for exemptions)

Exemptions allowed, subject to all just exceptions.

C.Ms. stand disposed of.

RSA No. 157/2017 and C.M. Appl. No. 20928/2017 (for stay)

1. This Regular Second Appeal under Section 100 of Code of Civil Procedure, 1908 (CPC) impugns the concurrent judgments of the courts below; of the Trial Court dated 28.3.2016 and the First Appellate Court dated 4.3.2017; by which the suit filed by the appellant/plaintiff for possession, permanent injunction and mandatory injunction, has been dismissed.

2. The facts of the case are that appellant/plaintiff claimed that she was the owner of 200 sq. yards of the property situated in khasra no. 419, Village Saboli, Gali No. 10, Shahdara, Delhi. Out of the area of 200 sq. yards, the appellant/plaintiff sold 70 sq. yards to the respondent no.1/defendant no.1 on 11.2.1998 for a sale consideration of Rs.1,75,000/-. On 11.2.1998, appellant/plaintiff executed the usual set of documentation being the agreement to sell, general power of attorney, Will, receipt, etc. in favour of the respondent no.1/defendant no.1. I may note that the defendant no. 1 in the suit expired pendente lite and therefore she is now represented by her legal heirs. The area of 70 sq. yards consists of two rooms, a latrine and a bath room, and possession of which was taken by the respondents/defendants on 11.2.1998. It was further pleaded in the plaint that since there was non-payment of the entire consideration hence the appellant/plaintiff cancelled the documentation dated 11.2.1998 by the cancellation document dated 6.4.1998, and appellant/plaintiff also sent a legal notice of the same date to the respondents/defendants. It was further pleaded that inspite of cancellation of the documents on 6.4.1998 the respondents/defendants did not vacate the suit property, and hence the subject suit was filed. For the sake of completion of narration it may be stated that defendant no. 1 in the suit was the wife of defendant no. 2, and respondents in this appeal are the defendant no. 2 and the legal heirs of the deceased defendant no. 1.

3. The suit was contested by the respondents/defendants. It was pleaded by the respondents/defendants that complete consideration of Rs.1,75,000/- was paid when the documents dated 11.2.1998 were executed in favour of the respondent no.1/defendant no. 1. It was also pleaded that the appellant/plaintiff with dishonest intentions cancelled the documents on 6.4.1998. It was pleaded by the respondents/defendants that appellant/plaintiff had no authority to cancel the documents and hence the cancellation has no significance to the purchase of the suit property by the respondent no.1/defendant no. 1. The respondents/defendants pleaded that the adjoining 130 sq. yards to the plot of 70 sq. yards was already owned and was in possession of the respondents/defendants, and hence the respondents/defendants are in possession of the whole 200 sq. yards. The suit was accordingly prayed to be dismissed.

4. The main issue which was argued before the courts below, and also before this Court on behalf of the appellant/plaintiff, was that since the complete consideration was not paid hence the documents dated 11.2.1998 executed by the appellant/plaintiff in favour of the respondent no.1/defendant no. 1 were validly cancelled by the cancellation document dated 6.4.1998 and which was duly registered before the Sub-Registrar.

5. The courts below have held that the documents dated 11.2.1998 executed by the appellant/plaintiff in favour of the respondent no.1/defendant no. 1 could not have been legally cancelled. For the disentitlement of the appellant/plaintiff to cancel the general power of attorney reliance is placed by the courts below to Section 202 of the Indian Contract Act, 1872 which provides that the general power of attorney given for consideration is irrevocable. The courts below have also held that the cancelled documents do not mention that consideratio