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2023 Supreme(P&H) 1266

IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH
B.S. Walia, J.
Smt. Gora - Appellant - Appellant
Versus
Bir Singh and others - Respondents - Respondent
RSA-1944 of 2018(O&M)
Decided On : 18-01-2023

Advocates appeared:
Mr. Chanderhas Yadav, Advocate for the appellant.

The central legal point established in the judgment is that the termination of an agent's authority must be communicated to the agent and third parties to affect the validity of transactions, as per the provisions of the Indian Contract Act, 1872.

Headnote:

Cancellation of Power of Attorney - Property Dispute - Indian Contract Act, 1872 - Section 208, Section 206, Section 207 - Smt. Ram Asri alias Nikko vs. Rakesh Chand and others 2008 (4) RCR (Civil) 335, Rajesh and others vs. Tarsem Lal and others 2015 (8) RCR (Civil) 805

Fact of the Case:

The appellant and her sister executed a power of attorney in favor of respondent No.2, which was later cancelled. The dispute arose regarding the cancellation notice issued to respondent No.2 before the execution of a sale deed by respondent No.2 in favor of respondent No.1.

Finding of the Court:

The court found that the cancellation of the power of attorney was not established to the knowledge of respondent No.2 prior to the execution of the sale deed, and therefore, the sale deed was valid.

Issues: The main issue was whether due notice of the cancellation of the power of attorney had been issued to respondent No.2 before the execution of the sale deed.

Ratio Decidendi: The court relied on the Indian Contract Act, 1872, particularly Section 208, Section 206, and Section 207, and referenced the decisions in Smt. Ram Asri alias Nikko vs. Rakesh Chand and others and Rajesh and others vs. Tarsem Lal and others to establish the legal principles regarding the communication and knowledge of the cancellation of the power of attorney.

Final Decision: The appeal was dismissed, and the court upheld the validity of the sale deed.

B.S. WALIA, J.

1. Regular Second Appeal has been filed by one of the plaintiffs (appellant herein) against the concurrent findings recorded by the learned Courts below, dismissing the suit of the plaintiffs for declaration for cancellation of sale deed dated 25.08.2009 and for injunction for restraining respondent Nos.1 and 2 from interfering in the peaceful possession of the suit property.

2. Brief facts of the case are that the appellant and her sister (Bhora-original plaintiff No.2) and respondent No.2 are in the relationship of paternal aunts and nephew and that the appellant and Bhora had executed a registered power of attorney dated 10.08.2009, in favour of respondent No.2, authorizing him to sell the property owned by them. However, due to dispute between the plaintiffs with respondent No.2, registered power of attorney dated 10.08.2009, executed by the appellant and her sister-Bhora, in favour of respondent No.2 was cancelled vide registered cancellation deed dated 18.08.2009.

3. Learned counsel contends that the only point in issue is with regard to whether due notice had been issued by the appellant and plaintiff No.2 to respondent No.2 with regard to the cancellation of the registered power of attorney dated 10.08.2009, before the execution of the sale deed dated 25.08.2009, by respondent No.2 in favour of respondent No.1. Learned counsel contends that the judgment and decree passed by the learned trial Court dismissing the civil suit filed by the plaintiffs was challenged by way of appeal only by one of the plaintiffs namely appellant herein i.e. Gora. Learned counsel has also referred to paragraph No.11 of the judgment of the learned Appellate Court in support of the plea that respondent No.2 had due notice of the cancellation of the registered power of attorney dated 10.08.2009. A perusal of the contents of paragraph No.11 of the judgment passed by the learned Appellate Court reveals that respondent No.2 and his cousin-Billu are stated to have accompanied the plaintiffs when they had cancelled the registered power of attorney dated 10.08.2009 and on said basis, learned counsel contends that it stands established that respondent No.2 had due notice of the cancellation of the registered power of attorney, therefore, respondent No. 2 could not have executed the sale deed on 25.08.2009.

4. I have considered the submission of learned counsel and have gone through the impugned judgments but am unable to agree with the submission of the learned counsel. Admittedly, the cancellation deed was not furnished to respondent No.2 against acknowledgement nor there is any notice in writing containing acknowledgement of respondent No.2 of intimation of cancellation of the registered power of attorney on 18.08.2009. Apart from the statement of appellant of respondent No.2 having accompanied her at the time when she had cancelled the registered power of attorney dated 10.08.2009 along with Billu, no other evidence is there on the record. Accordingly, it cannot be established that cancellation of the registered power of attorney dated 10.08.2009, was to the knowledge of respondent No.2 prior to the execution of the sale deed, therefore, he could not have executed sale deed dated 25.08.2009, in favour of respondent No.1. A perusal of paragraph No.13 of the judgment passed by the learned Appellate Court reveals reference to the evidence of Ajay Kumar, Registration Clerk (PW-3), who has produced the record of power of attorney No.223 dated 10.08.2009, cancellation deed No.236 dated 18.08.2009 and sale deed No.3796 dated 25.08.2009 (Ex.P-1, P-2 and P-3 respectively) and also stated that the entries regarding cancellation deed were not mentioned against the entry of registration of power of attorney. A perusal of paragraph No.14 of the judgment passed by the learned Appellate Court reveals reference to the evidence of Mamraj (PW-4), who stated that on 18.08.2009, the appellant and her sister-Bhora had cancelled the registered power of attorn

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