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2024 Supreme(Mad) 1045

IN THE HIGH COURT OF JUDICATURE AT MADRAS
THE HONOURABLE MR.JUSTICE V.LAKSHMINARAYANAN
M.Chinnathambi @ Mani – Appellant
Versus
Kannaiyan - Respondent
S.A.No.405 of 2013
Decided On : 29-01-2024

Advocates:
Advocate Appeared:
For the Appellant : Mr.N.Suresh
For the Respondent: Mr. A.Tamilvanan

IMPORTANT POINT
A Power of Attorney can be revoked by the principal unless it is coupled with an interest in the property, as per Section 202 of the Indian Contract Act.

Headnote:

POWER OF ATTORNEY - CANCELLATION OF POWER OF ATTORNEY - Indian Contract Act, Section 202 - The court discussed Section 202 of the Indian Contract Act, which states that an agency cannot be terminated to the prejudice of the agent's interest in the property unless there is an express contract to the contrary. The court interpreted this provision to mean that a Power of Attorney can be revoked by the principal unless it is coupled with an interest. The court concluded that the Power of Attorney in question did not create an interest in favor of the plaintiff, allowing the defendant to cancel it.

Fact of the Case:

The plaintiff filed a suit against the defendant for a declaration that the cancellation of a Power of Attorney was non-est and for a permanent injunction against the defendant from alienating the property. The defendant admitted to executing the Power of Attorney but claimed it was cancelled due to the plaintiff's failure to account for transactions related to the property.

Finding of the Court:

The trial court dismissed the plaintiff's suit, and the appellate court confirmed this decision. The courts found that the Power of Attorney was not coupled with an interest, allowing the defendant to cancel it.

Issues: 1) Whether the plaintiff is entitled to the declaration relief as prayed for? 2) Whether the plaintiff is entitled to a permanent injunction as prayed for?

Ratio Decidendi: The court held that a Power of Attorney can be revoked by the principal unless it is coupled with an interest in the property. The absence of such interest in this case justified the cancellation of the Power of Attorney by the defendant.

Final Decision: The Second Appeal was dismissed, confirming the lower courts' judgments and decrees.

JUDGMENT :

Prayer:- This Second Appeal has been filed under Section 100 of Civil Procedure Code against the Judgment and decree dated 11.10.2012 made in A.S.No.115 of 2011 on the file of the learned I Additional Subordinate Judge, Salem confirming the judgment and decree dated 01.06.2011 passed in O.S.No.546 of 2010 on the file of the I Additional District Munsif, Salem.

This Second Appeal has been preferred against the Judgment and decree dated 11.10.2012 made in A.S.No.115 of 2011 on the file of the learned I Additional Subordinate Judge, Salem confirming the judgment and decree dated 01.06.2011 passed in O.S.No.546 of 2010 on the file of the I Additional District Munsif, Salem.

2. For the sake of convenience, the parties are referred to as per their rankings in the suit.

3. The plaintiff pleads that the defendant is the owner of the suit schedule mentioned property. On 8.10.2004, the defendant executed Power of Attorney appointing the plaintiff as his agent. This document is registered vide document no.323 of 2004 on the file of the Salem (East) District Registration Office at Salem. On 14.07.2004, the defendant approached him for selling the suit property fixing the price at Rs.1,85,000/-. The plaintiff agreed to purchase the same and paid an advance of Rs.10,000/-. Deducting the amount of Rs.10,000/- already paid, the plaintiff pleaded that he paid balance of Rs.1,75,000/- on 18.10.2004.

4. In the meantime, one Palaniappan approached the plaintiff and offered to purchase the property @ Rs.105/- per sq.feet and an agreement was entered into between the plaintiff and the said Palaniappan on 12.10.2007. The said Palaniappan presented a suit in O.S.No.17 of 2008 on the file of the Principal Subordinate Judge, Salem for recovery of amount paid by him as he was not willing to proceed with the sale transaction.

5. It is the further case of the plaintiff that the defendant had approached him for some more amount than Rs.1,85,000/- that has been offered for sale of the property. As the plaintiff was not willing for the same, the Power of Attorney executed by the defendant in favour of the plaintiff was cancelled by a document dated 11.02.2008. Therefore, the plaintiff came forward with the suit for declaration that the cancellation of Power of Attorney dated 11.02.2008 is non-est and not binding on him and also for the relief of permanent injunction restraining the defendant from in any manner alienating the property.

6. The defendant, on entering appearance, presented a statement, praying to reject the claim made by the plaintiff. The same is as follows:

    (i) He admitted that he executed the Power of Attorney in favour of the plaintiff,

(ii) He also admitted the cancellation of Power of Attorney

(iii) Palaniappan had filed a suit against him and since there was a dispute with respect to pathway running over the property, he was not willing for converting the sale agreement entered into between himself and the plaintiff into a sale deed, but wanted to refund the advance amount that he received from the plaintiff. He further pleaded that the entire amount paid by Palaniappan was repaid by the defendant and not by the plaintiff.

7. On the strength of their respective pleadings, the parties went on trial. On the basis of these pleadings, the following issues were framed:

    i) Whether the plaintiff is entitled to declaration relief as prayed for?

ii) Whether the plaintiff is entitled to permanent injunction as prayed for?

8. The plaintiff entered the witness box and examined himself as PW.1 apart from examining one Maiyappan as PW2. He marked Exs.A1 to A13. Similarly, the defendant entered the witness box as DW1 and examined the Advocate who contested O.S.No.17 of 2008 as DW2. He marked Exs.D1 to D9.

9. After a detailed trial, the learned trial Judge dismissed the suit holding that the plaintiff is not entitled to any relief. Aggrieved by the same, regular appeal was presented in A.S.No.115 of 2011 on the file of the learned I Additional Subordinate

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