Supreme Court: The division bench of M.R. Shah and B.V. Nagarathna, J.J., passed a split verdict in a plea pertaining to the issue whether non-production of Power of Attorney (‘PoA') during a suit to prove a sale deed which was executed on the strength of the same PoA, would be fatal to the case of the plaintiff. While Justice Shah stated that the plaintiff had not produced the PoA and thus, the Tripura High Court had committed a grave error in drawing the statutory presumption under Section 60 of the Registration Act, 1908 (‘1908 Act'), Justice Nagarathna opined that non-production of PoA was not fatal to the case of the original plaintiff as it was not an indispensable requirement to establish the validity of the sale deed.
In the matter at hand, the dispute pertains to title and possession of ‘Schedule A' property. The respondents (‘original plaintiffs') had filed a civil suit before the Trial Court for declaration of title over the subject land and recovery of khas possession from the appellants (‘original defendants'). Original plaintiff no.2 in the Trial Court claimed his ownership on the basis of sale deed executed by plaintiff no.1, in his own favour on the basis of PoA executed by the original owner, however, the same PoA was not produced before the Trial Court. Therefore, the Trial Court dismissed the suit for want of production of PoA and had held that the provisions of Section 33 (1) (c) of the 1908 Act was not complied with.
The plaintiffs thus preferred an appeal before the first appellate Court, by filing an application under Order 6 Rule 17 of the Code of Civil Procedure,1908 (‘CPC') for amending the plaint, stating that the alleged PoA was in illegal possession of defendant no.1. However, the first appellate Court dismissed the appeal and confirmed the judgment passed by the Trial Court by stating that the subsequent sale deed in favour of plaintiff no.1 by plaintiff no.2 also could not be treated as genuine.
The Tripura High Court, however, allowed the second appeal preferred by the plaintiffs by drawing a statutory presumption under Section 60 of the 1908 Act in respect of existence of PoA by virtue of endorsement and directed the original defendants to handover the vacant possession of the subject property to the original plaintiffs. Thus, the original defendants feeling aggrieved by the decision of the High Court in the second appeal, approached the Supreme Court by way of Civil Appeal.
Issues for consideration
Whether the statutory requirements of Section 33 (1) (c) of the 1908 Act had been complied with in the instant case while executing the power of attorney?
Whether non-production of the document of PoA before the Trial Court and the first appellate Court would be fatal to the case of the plaintiffs?
Whether the plaintiffs have proved both the sale deeds?
Verdict by Justice M.R Shah
Justice M.R. Shah while setting aside the judgement passed by the Tripura High Court restored the order passed by the Trial Court and opined that the Trial Court was justified in dismissing the suit and the same was rightly confirmed by the first appellate Court.
Shah, J noted that only in cases where the execution of the PoA was as per section 32 read with section 33 (1) (c), that there shall be statutory presumption under Section 60 of the 1908 Act. The Court observed that the requirement of Section 33(1)(c) of the 1908 Act was not satisfied in the present case as the provision entitles executions of such PoA valid which are authenticated by a Notary Public, or any Court, Judge, Magistrate, Indian Consul, or representative of the Central Government in cases where the principal at the time of execution of such PoAs do not reside in India. Therefore, held that the High Court has committed a grave error in drawing the statutory presumption under Section 60 of the 1908 Act.
Shah. J. also took serious consideration on the conduct on the part of plaintiffs executing the second sale deed in favour of plaintiff no.1 i.e., his own wife as there was no reason for him to execute the same in his wife's name once he had become the owner on the basis of the registered sale deed. The plaintiff submitting application to amend the plaint under Order 6 Rule 17 of CPC also created a doubt about the genuinity of the PoA.
Verdict by Justice B.V. Nagarathna
Justice Nagarathna affirmed the dismissal of the suit ordered by the Tripura High Court and set aside the order stated by the Trial Court.
Nagarathna J. while analysing the first issue for consideration, perused Section 17 and Section 18(f) of the 1908 Act and held that the PoA was not compulsorily registrable document when it is duly notarised, as it carries presumption of being valid in view of Section 85 of Evidence Act, 1872 making the registration of PoA as optional.
Nagarathna J. referred to Suraj Lamp and Industries v. State of Haryana (2012) 1 SCC 656 to navigate the nature and scope of power of attorney and held that “An attorney holder may execute a deed of conveyance in exercise of the power granted under the power of attorney and convey title on behalf of the grantor or principal, provided he has been specifically given power to sell the property of the principal.”
Nagarathna J. perused the sale deeds referred by the original plaintiffs and stated that PoA had been authenticated by Magistrate, 1st Class of Komilla (Bangladesh), authorising the attorney to execute a sale deed for a house in India, which was sufficient to prove its execution in accordance with Section 33(1) (c) of the 1908 Act. Hence, the Court dismissed the contentions of the original defendants that the requirement of Section 33 (1) (c) of the 1908 Act had not been complied with.
Nagarathna J. explaining her stance stated that the compliance of provision of Section 34,35, 52, 58 and 59 of 1908 Act constitutes registration. The certificate of registering officer is admissible to prove the admission of execution. Thus, presumption of correctness attached to endorsement made by the Sub-Registrar was in view of the provisions of Sections 58, 59 and 60 of the 1908 Act and such a presumption can be rebutted only by strong evidence to the contrary.
While dealing with the second issue at hand, Nagarathna J. navigated through various judgments of the Supreme Court and held that the registered document carries with it, the presumption as to the authority of the person executing it. The Trial Court and the first appellate Court failed to treat the endorsement made by the District Sub-Registrar on the body of the sale deed, as evidence in respect of the authority of Plaintiff no. 2 to execute the sale deed.
Nagarathna J. was of the view that the sale made on behalf of the original seller to the buyer through PoA could not be vitiated only because the PoA was not produced before the Trial Court. Even in the absence of production of PoA, the contents of the sale deed prove the execution of PoA as well as the sale deed.
Nagarathna J. relied on Amar Nath v. Gian Chand (2022) SCC OnLine SC 102 while stating that the production of the original PoA was not an indispensable requirement to establish the validly of execution of a sale deed.
“There is no contra evidence produced by the defendants so as to defeat the validity of the sale deeds. The said documents speak for themselves.”
Nagarathna J. while analysing the third issue for consideration, stated that the Trial Court and the first appellate Court have concurrently found that the defendants do not have any title over the subject property against which the defendants never preferred an appeal, resulting into such finding attaining finality. In addition, the original owner did not initiate any proceeding to dispute the execution of PoA in favour of Plaintiff no. 2. Moreover, the original defendant was aware of the sale deed and the PoA and yet not taken any step to challenge Plaintiff no. 2's title over the subject property.
Thus, held that there is no reason to disbelieve the recitals contained in the registered sale deed, merely on the ground that the document conferring PoA in favour of plaintiff no. 2 was not produced before the Trial Court. Nagarathna J. was of the view that the High Court was therefore right in holding that when a document has been duly registered, there is a presumption of correctness, and it can be rebutted only by strong evidence to the contrary.
Nagarathna J. concurred with the view held by the High Court that the original plaintiff no.2 was duly nominated and constituted as the attorney by the original owner of the subject property and on the strength of the said PoA, plaintiff no.2 transferred land in favour of himself as the absolute owner. Subsequently, plaintiff no.2 sold the subject property to plaintiff no.1 who had every right to recover the subject property.
[Manik Majumder v. Dipak Kumar Saha through LRs, 2023 SCC OnLine SC 37, decided on 13-01-2023]
Advocates who appeared in this case :
For the appellant- Advocate Rajan K. Chourasia
For the respondent- Advocate Hrishikesh Baruah