GPA Holder Bhisham Mehta Ordered to Pay ₹1.01 Crore to Sister-in-Law's Heirs: Delhi High Court

The Delhi High Court has firmly reiterated that a General Power of Attorney (GPA) is a mere instrument of agency and does not convey ownership, dismissing an appeal by Bhisham Mehta who sought to retain over Rs 1 crore from the sale of property belonging to his late sister-in-law. A bench of Justice Neena Bansal Krishna upheld a decree under Order XII Rule 6 CPC, directing Mehta to pay Rs 1,01,78,074 along with interest to the legal heirs of Smt. Kusum Mehta.

A Purchase Turned Dispute

In March 1985, Kusum Mehta and three sisters-in-law jointly purchased agricultural land in Paprawat, Delhi, with each owning an undivided 1/4th share. Mehta’s husband, Bhisham Mehta, was granted a registered GPA to manage her share. In April 2011, Bhisham Mehta sold the entire property to M/s Agile Properties Limited for Rs 6.95 crore, executing the sale deed as GPA holder for Kusum and two other co-owners. Her 1/4th share amounted to about Rs 1.74 crore, but Mehta transferred only Rs 71.99 lakh to her account, retaining the balance.

After Kusum’s death in December 2013, her daughters—the respondents—demanded the remaining amount. When Mehta refused, they filed a recovery suit in April 2014.

The Defence That Crumbled

Mehta claimed that the GPA, which included the power of gift, effectively transferred ownership to him. He also argued that the Rs 72 lakh deposited into Kusum’s account was an interest-free friendly loan, not part of the sale consideration. A counter-claim for the same sum was also filed.

The High Court rejected both arguments. “A General Power of Attorney is not an instrument of transfer of right, title or interest in an immovable property, but is a document of agency. Even an irrevocable Power of Attorney does not have the effect of transferring title to the attorney,” the judgment stated.

Admissions Seal the Case

The court found clear admissions from Mehta’s own documents. The registered sale deed described the property as the “self-acquired property” of all four co-owners. His income tax returns did not reflect the sale proceeds, confirming he was not the true owner. Section 218 of the Indian Contract Act, 1872, mandates an agent to remit sums received on behalf of the principal.

The loan theory was further demolished by Mehta’s own reply to a police complaint, where he admitted depositing identical sums of Rs 72 lakh into the accounts of all three co-owners after the sale. “It is inconceivable that… each would… have requested the Appellant to advance an interest-free friendly loan of the identical sum,” the court observed, calling the defence a “moonshine defence.”

Court’s Final Word

Dismissing the appeal, the High Court found no infirmity in the trial court’s 2020 decree. The separate counter-claim filed by Mehta remains pending as an independent suit. The ruling underscores that a GPA holder cannot assert personal ownership over property and is statutorily bound to account for sale proceeds to the true owner.

[#GeneralPowerOfAttorney, #DelhiHighCourt]