M. S. Ananthamurthy v. J. Manjula (2025) 304 Taxman 81 (SC). Editorial : M. S. Ananthamurthy v. J. Manjula (RFA No. 1318 /2004 c/w R.F.A No. 1317/2014 dt 16 -10-2019(Karn)(HC)

S. 2(47) : Transfer-Suit for declaration of ownership and possession of immovable property-General Power of Attorney-Sale deed executed by GPA holder after death of principal-GPA was general in nature and not coupled with interest-Agreement to sell does not convey title or ownership-Transfer of immovable property can be only by registered conveyance-Contemporaneous GPA and agreement to sell in favour of same person not sufficient to infer interest in property-In absence of registration of documents under section 17(1)(b) of Registration Act, GPA holder had no valid right, title or interest to execute sale deed-Sale deed executed by GPA holder after death of principal held invalid-Subsequent registered conveyances by legal heirs upheld. [Transfer of Property Act, 1882, S, 54, 55, Registration Act, 1908, S. 17(1)(b), 49, Indian Contract Act, 1872, S. 201, 202]

The original owner had executed a GPA and an agreement to sell in favour of one person. After his death, the GPA holder executed a registered sale deed in favour of her son. The legal heirs of the original owner thereafter sold the property through registered sale deeds, culminating in a registered gift deed in favour of the respondent. The Trial Court decreed the respondent’s suit for injunction and dismissed the appellants’ suit for declaration and possession; the High Court affirmed. On appeal, the Supreme Court held that a power of attorney creates only a principal-agent relationship and, unless coupled with interest within the meaning of section 202 of the Contract Act, the authority stands terminated on the death of the principal under section 201. On facts, the GPA was only general in nature, merely authorising management and dealing with the property, and did not secure any proprietary interest of the agent in the subject-matter; mere use of the word “irrevocable” was not decisive. The contemporaneous agreement to sell also did not confer ownership, as an agreement to sell is not a conveyance and does not transfer title in immovable property. Even if the GPA and agreement to sell were read together, any claimed interest in immovable property required compulsory registration under section 17(1)(b) of the Registration Act; in the absence of registration, no right, title or interest could be asserted on that basis. Therefore, the GPA holder had no authority to execute the sale deed after the death of the principal, and the sale deed in favour of appellant No. 2 was invalid. The Supreme Court accordingly upheld the  order of High Court and dismissed the appeals.  Referred  Suraj Lamp & Industries Pvt. Ltd. v. State of Haryana (2012) 1 SCC 656, Timblo Irmaos Ltd. v. Jorge Anibal Matos Sequeira (1977) 3 SCC 474.   

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