Agreement To Sell, General Power Of Attorney Or Unproved Will Does Not Confer Any Valid Title: Supreme Court

The appellants approached the Apex Court challenging the judgment of the Delhi High Court dismissing their Regular First Appeal. The High Court affirmed the order whereby the decree in a suit for possession, mesne profits, declaration, and mandatory injunction filed by the Respondent (plaintiff) came to be confirmed, by dismissing the counterclaim for declaration filed by the Appellant.

The Division Bench of Justice Aravind Kumar and Justice Sandeep Mehta held, “Even if we accept the validity of the Power of Attorney in favour of the plaintiff, still it does not confer a valid title on him with respect to the suit property.”

“It is highly unlikely that a father would grant his entire property to one of his children, at the cost of three others, without there being any evidence of estrangement between the father and the children. This suspicious circumstance surrounding the will has not been removed by the plaintiff either. Hence, for these cumulative reasons, the Will propounded by plaintiff though registered would not confer any valid title on the plaintiff either”, it added.

AOR S. Mahendran represented the Appellant while AOR Rekha Pandey represented the Respondent.

Factual Background

The suit property was originally owned by one Kundan Lal, the father of the Appellant/ first Defendant and first Respondent/ Plaintiff. The plaintiff claimed that he had acquired title to the suit property from his father by virtue of a General Power of Attorney, Agreement to Sell, Affidavit, and a Receipt. He also claimed that his father had executed a registered Will bequeathing the suit schedule property in his favour. He further claimed that the appellant was living in the suit property as a licensee, and after the purchase of the suit property by the plaintiff, the defendant was residing in the suit property as a mere trespasser. The plaintiff filed a suit against the defendants for the recovery of possession, mesne profits, declaration of title and mandatory injunction directing the defendant to handover the original documents to him.

The District Judge decreed the suit in favour of the plaintiff and dismissed the counterclaim filed by the defendant on the ground that the property had been transferred by Kundan Lal in favour of the plaintiff by upholding the validity of the documents. The defendant’s Regular First Appeal came to be dismissed. The defendant’s civil appeal came to be allowed in part and the matter was remanded back to the High Court for fresh disposal with an observation that the Agreement to Sell / General Power of Attorney / Will Transactions are not ‘transfers’ or ‘sales’ and such transactions cannot be treated as transfers or conveyances as contemplated under Transfer of Property Act, 1882. Aggrieved by the dimissal of the appeal, the defendant approached the Apex Court.

Reasoning

The Bench took note of the fact that the plaintiff claimed that there was only an agreement to sell, and there was no sale deed executed in his favour by the father. “As per the settled position of law, this document does not confer a valid title on the plaintiff as it is not a deed of conveyance as per Section 54of the TP Act. At best, it only enables the plaintiff to seek for specific performance for the execution of a sale deed and does not create an interestor charge on the suit property”, it said.

Coming to the aspect of the General Power Of Attorney, the Bench noted that the GPA merely authorised the grantee to manage the affairs of the suit property, which included the power to let out the property on rent, and create a mortgage of the same, etc. However, it was silent on the aspect of conveyance. The recitals of the power of attorney indicated that the intent of the grantor was to limit the powers of the grantee to only manage the suit property, and not to create any interest in his favour, which, according to the Bench, was in consonance with the settled position of law that a power of attorney is an agency by which the agent derives the authority or the right to enter into transactions on behalf of the principal. On the aspect of Will, the Bench noted that the mere fact that the Will was registered would not grant validity to the document. Moreover, the will propounded by plaintiff was surrounded with suspicious circumstances, in as much as the alleged propounder of the Will, Lt. Kundan Lal, had four children, including the plaintiff and the first defendant. However, there was not even a whisper of reasoning as to why the propounder of the Will chose to exclude other three children from the bequest, and whether any other properties or assets were given to them. As per the Bench, the will surrounded by suspicious circumstances and the power of attorney did not confer a valid title.

Reliance was also not placed upon the receipt of consideration and affidavit executed by Kundan Lal. The Bench was of the view that the property was originally owned by Kundan Lal, namely the father of the plaintiff and the first defendant and on his demise, the succession had opened up. The will propounded by the plaintiff having been held not proved, the Bench held that class-I legal heirs of deceased Kundan Lal would be entitled to the share in the suit schedule property.

“A perusal of Section 53A of TP Act, as well as the case law on point, it is forthcoming that one of the main ingredients for taking shelter under Section 53A is the factum of possession. Unless the transferee in the instrument of agreement to sale is able to prove that he has been in possession of the suit property, no benefit u/s 53A will be given. In the instant matter, the very fact that plaintiff has filed the present suit for possession, along with other reliefs, shows that on the date of filing of the suit, plaintiff was not in possession of the entire suit property. Since there was no possession with the plaintiff, he cannot derive any benefit under the doctrine of part-possession”, it said.

Taking note of the fact that the appellant had sold 50% of the suit property in favour of the second defendant, the Bench held, “... we are of the considered view that the right of the second defendant would stand protected to the extent of the share of the appellant only and except reiterating to this effect contentions of all parties are kept open, and no opinion is expressed and they are at liberty to work out their rights if so advised in accordance with law.”

Thus, allowing the appeal, the Bench set aside the impugned judgment and dismissed the suit of the plaintiff, subject to its observations.

Cause Title: Ramesh Chand v. Suresh Chand (Neutral Citation: 2025 INSC 1059)

Appearance

Appellant: AOR S. Mahendran

Respondent: AOR Rekha Pandey, Advocates Raghav Pandey, Shiv Prakash Pandey, Ritesh Kumar, Gauri Pandey

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