MRS. UMADEVI NAMBIAR vs. THAMARASSERI ROMAN CATHOLIC DIOCESE REP BY ITS PROCURATOR DEVSSIAS SON REV. FATHER JOSEPH KAPPIL

Case Type: Civil Appeal

Date of Judgment: 01-04-2022

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Full Judgment Text

ture N<br>lly sig<br>nt Kum<br>2022.<br>:46 IS<br>on:REPORTABLE<br>IN THE SUPREME COURT OF INDIA<br>CIVIL APPELLATE JURISDICTION<br>Civil Appeal No.2592 of 2022<br>(Arising out of Special Leave Petition (C) No.20047 of 2017)<br>MRS. UMADEVI NAMBIAR ...APPELLANT(S)<br>VERSUS<br>THAMARASSERI ROMAN CATHOLIC<br>DIOCESE REP BY ITS PROCURATOR<br>DEVSSIA’S SON REV. FATHER<br>JOSEPH KAPPIL ...RESPONDENT(S)<br>J U D G M E N T<br>V. Ramasubramanian<br>1. Their suit for partition having been decreed by the trial Court<br>but reversed by the High Court in a regular first appeal, the<br>plaintiffs have come up with the above appeal.<br>ot Verified<br>2. We have heard Shri Dushyant A. Dave, learned senior counsel<br>ned by<br>ar Arora<br>04.02<br>T<br>for the appellant and Shri Thomas P. Joseph, learned counsel for<br>1
the respondent. The   suit   schedule   property   originally   belonged   to   one 3. Ullattukandiyil Sankunni. After his death, the property devolved upon his two daughters, one of whom is the appellant herein. The appellant   herein   executed   a   general   Power   of   Attorney   on 21.07.1971, registered as Document No.35 of 1971, in favour of her sister Smt. Ranee Sidhan. However, the said power was cancelled on 31.01.1985. But in the meantime, the appellant’s sister was found to have executed four different documents in favour of certain third parties, assigning/releasing some properties. Therefore, the appellant first filed a suit in O.S.No.16 of 1986 followed by another suit in O.S.No.27 of 1988 against the assignees/releasees. Though a preliminary decree was passed in the second suit on 7.01.1989, the appellant came to know later that the assignees/releasees had sold the property to the respondent herein.  4. Therefore, the appellant filed yet another suit in O.S No.130 of 1989, seeking partition and separate possession of her half share in the suit property. The trial Court granted a preliminary decree in favour of the appellant. However, the regular appeal filed by the 2 respondent herein was allowed by a Division Bench of the High Court   by   the   judgment   and   decree   impugned   in   this   appeal. Therefore, the appellant has come up with the above appeal. 5. At the outset, it should be stated that the respondent herein did not dispute the fact that the suit schedule property originally belonged to the father of the appellant and her sister and that the appellant   and   her   sister   were   entitled   to   equal   shares   in   the property. But the respondent contested the suit on the grounds inter alia   (i)  that in view of two prior suits for partition, namely, O.S. No.16 of 1986 and O.S.No.27 of 1988, the suit was barred under Order  II  Rule  2  of   CPC;     that  the   general Power   of  Attorney (ii) executed by the appellant in favour of her sister, authorized the agent   to   sign   all   documents   and   present   them   for   registration; (iii)   that   by   virtue   of   the   said   power,   the   appellant’s   sister transferred   the   suit   schedule   properly   to   four   persons,   for   the purpose of discharging the debts incurred in the family business; (iv)   that   those   transferees,   in   turn,   sold   the   property   to   the respondent herein for a valuable consideration;   that though the (v) 3 appellant was earlier residing in England, she came back to India and   was     staying   in   a   house   just  1   km.   away   from   the   plaint schedule property;   that the appellant was therefore aware of all (vi) the transfers including the transfer in favour of the respondent and the development made by the respondent over the suit property;   that, therefore, the appellant is guilty of acquiescence; and (vii) (viii)   that   the   respondent   has   actually   developed   a   commercial complex on the suit property and hence entitled at least to the value of improvements, in the event of a decree being passed. The trial Court framed as many as 23 issues for consideration 6. in the suit. The objection on the basis of Order II Rule 2 of CPC was rejected by the trial Court on the ground that the appellant’s sister had committed a fraud and that the cause of action for the present suit was different from the cause of action for the previous suits. The contention that the appellant was guilty of acquiescence was rejected by the trial Court on a factual finding that the appellant was not aware of the transfer. On an examination of the recitals contained in the Power of Attorney, the trial Court came to the 4 conclusion that the document did not confer any power to sell the property and that, therefore, the appellant’s sister was not entitled to alienate the property. Since the original alienations made in 1981 and 1982 by the appellant’s sister were null and void on account of lack of express power to sell, the subsequent sale made by those alienees in favour of the respondent herein was also held to be invalid. On the basis of these findings, the trial Court decreed the suit, as prayed for. While reversing Judgment and decree of the trial Court, the 7. High Court held:  (i)  that the failure of the appellant to seek the relief of   setting   aside   the   documents   of   transfer   and/or   recovery   of possession of the property was fatal to her case;   that though the (ii) principle behind Order II Rule 2 CPC may not be applicable to suits for partition, the appellant must be held to have had constructive notice of the alienations made by her sister, in view of Section 3 of the Transfer of Property Act, 1882 (hereinafter referred to as “ the Act ”);   (iii)   that   once   constructive   notice   is   attributed   to   the appellant, any relief for cancellation of the documents of alienation 5 would have already become time barred, by the time the Power of Attorney was cancelled;   that since the deed of general Power of (iv) Attorney filed as Exhibit A­1 did not contain any express power to sell   the   suit   property,   the   transferee   cannot   be   held   to   have exercised  ‘reasonable care’  as required by the proviso to Section 41 of the Transfer of Property Act, 1882; and  (v)  that despite this fact, the appellant was not entitled to a decree for partition, in view of her failure to seek the cancellation of the alienations, in spite of having constructive notice of the alienations. 8. As could be seen from the judgments of the trial Court and the High Court, the deed of general Power of Attorney executed by the appellant in favour of her sister on 21.07.1971, did not specifically contain any power of sale. Therefore, the trial Court as well as the High Court held in no uncertain terms that the appellant’s sister was   not   competent   to   sell   the   property   to   the   predecessor­in­ interest of the respondent. However, the learned counsel appearing for the respondent argued,  (i)  that while construing a document, all punctuation marks should be given due weightage;   that the deed (ii) 6 of Power of Attorney was drafted by a doyen of the Bar;   (iii)   that Clause 22 of the deed of Power of Attorney conferred upon the agent, the power to execute and register all documents;  (iv)  that the power to execute a document and present the same for registration, should be understood to mean the power to execute documents requiring registration in the light of Section 49 of the Registration Act, 1908; and   (v)   that, therefore, a   bonafide   purchaser like the respondent should not be made to suffer. 9. But we do not agree with the above submissions of the learned counsel for the respondent. It remains a plain and simple fact that the   deed   of   Power   of   Attorney   executed   by   the   appellant   on 21.07.1971 in favour of her sister contained provisions empowering the agent:  (i)  to grant leases under Clause 15;  (ii)  to make borrowals if and when necessary with or without security, and to execute and if necessary, register all documents in connection therewith, under Clause 20; and  (iii ) to sign in her own name, documents for and on behalf of the appellant and present them for registration, under Clause 22. But there was no clause in the deed authorizing and 7 empowering the agent to sell the property. The argument that the deed was drafted by a doyen of the Bar, is an argument not in favour of the respondent. This is for the reason that the draftsman has   chosen   to   include,   (i)   an   express   power   to   lease   out   the property;   and     an   express   power   to   execute   any   document (ii) offering   the   property   as   security   for   any   borrowal,   but   not   an express   power   to   sell   the   property.   Therefore,   the   draftsman appears to have had clear instructions and he carried out those instructions faithfully. The power to sell is not to be inferred from a document of Power of Attorney. The trial Court as well as the High Court were  ad idem  on the finding that the document did not confer any power of sale.   10. In fact the High Court rejected even the refuge sought by the respondent under Section 41 of the Transfer of Property Act which reads as follows: “Transfer   by   ostensible   owner .­   Where,   with   the consent, express or implied, of the persons interested in immoveable property, a person is the ostensible owner of   such   property   and   transfers   the   same   for consideration, the transfer shall not be voidable on the ground that the transferor was not authorised to make it: 8 Provided   that   the   transferee,   after   taking reasonable  care to ascertain that  the transferor had power to make the transfer, has acted in good faith.” 11. The High Court has held and in our view rightly so, that if the respondent   had   exercised   reasonable   care   as   required   by   the proviso to Section 41, they could have easily found out that there was no power of sale. 12. Unfortunately after finding   (i)   that the Power of Attorney did not   contain   authorization   to   sell;   and     that   the   respondent (ii) cannot claim the benefit of Section 41 of the Act, the High Court fell into an error in attributing constructive notice to the appellant in terms of Section 3 of the Act. The relevant interpretation clause in Section 3 of the Act reads as follows:
Interpretation Clause­
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a person is said to have notice" of a fact when he actually
knows that fact, or when, but for wilful abstention from an
enquiry or search which he ought to have made, or gross
negligence, he would have known it.
Explanation I­Where any transaction relating to
immoveable property is required by law to be and has been
effected by a registered instrument, any person acquiring
9
such property or any part of, or share or interest in, such
property shall be deemed to have notice of such instrument
as from the date of registration or,where the property is not
all situated in one sub­district, or where the registered
instrument has been registered under sub­section (2) of
section 30 of the Indian Registration Act, 1908 (16 of 1908),
from the earliest date on which any memorandum of such
registered instrument has been filed by any Sub­Registrar
within whose sub­district any part of the property which is
being acquired, or of the property wherein a share or interest
is being acquired, is situated:
(1)the instrument has been registered and its
registration completed in themanner prescribed
by the Indian Registration Act, 1908 (16 of 1908)
and the rules made thereunder,
(2)the instrumentor memorandum has been duly
entered or filed, as thecase may be, in books
kept under section 51 of that Act, and
(3)the particulars regarding the transaction to
which the instrument relates have been correctly
entered in the indexes kept under section 55 of
that Act.
Explanation II.­­Any person acquiring any immoveable
property or any share or interest in any such property shall
be deemed to have notice of the title, if any, of any person
who is for the time being in actual possession thereof.
Explanation III.­­A person shall be deemed to have had
notice of any fact if his agent acquires notice thereof whilst
acting on his behalf in the course of business to which that
fact is material:
Provided that, if the agent fraudulently conceals the
fact, the principal shall not be charged with notice thereof as
against any person who was a party to or otherwise
cognizant of the fraud.”
13. Two things are important for the above interpretation clause to 10 come into effect. They are:  (i)  wilful abstention from an enquiry or search; and     gross negligence.   Explanation I   and   Explanation II (ii) under the above interpretation clause are applicable to the person acquiring an immovable property, the transaction relating to which is required by law to be effected by a registered instrument. The High Court has turned the above interpretation clause upside down and held the Principal in relation to a deed of Power of Attorney, to have had constructive notice in terms of Section 3, of a sale effected by the agent. 14. The reasoning given by the High Court for holding that the appellant   ought   to   have   challenged   the   alienations,   is   that   the appellant was out of possession. Here again, the High Court failed to appreciate that the possession of an agent under a deed of Power of Attorney is also the possession of the Principal and that any unauthorized sale made by the agent will not tantamount to the Principal parting with possession. It is not always necessary for a plaintiff in a suit for partition 15. to seek the cancellation of the alienations. There are several reasons 11 behind this principle. One is that the alienees as well as the co­ sharer are still entitled to sustain the alienation to the extent of the share of the co­sharer. It may also be open to the alienee, in the final decree proceedings, to seek the allotment of the transferred property, to the share of the transferor, so that equities are worked out   in   a   fair   manner.   Therefore,   the   High   Court   was   wrong   in putting   against   the   appellant,   her   failure   to   challenge   the alienations. The learned counsel for respondent relied upon the decision of 16. this   Court  in   Delhi   Development   Authority   vs.   Durga   Chand 1 ,   in   support   of   his   argument   about   the   rule   of Kaushish interpretation to be adopted while construing Exhibit A­1, the deed of general Power of Attorney. He also relied upon the Judgment of 2 this Court in  Syed Abdul Khader  vs.  Rami Reddy and Others   for driving home the question as to how the deed of Power of Attorney should be construed. 17. We  do  not  know  how   the   ratio  laid   down   in  the   aforesaid 1 (1973) 2 SCC 825 2 (1979) 2 SCC 601 12 decisions could be applied to the advantage of the respondent. As a matter   of   plain   and   simple   fact,   Exhibit   A­1,   deed   of   Power   of Attorney did not contain a clause authorizing the agent to sell the property though it contained two express provisions, one for leasing out the property and another for executing necessary documents if a security had to be offered for any borrowal made by the agent. Therefore, by convoluted logic, punctuation marks cannot be made to convey a power of sale. Even the very decision relied upon by the learned counsel for the respondent, makes it clear that ordinarily a Power of Attorney is to be construed strictly by the Court. Neither Ramanatha Aiyar’s Law Lexicon nor Section 49 of the Registration  Act can amplify or magnify the clauses contained in the deed of Power of Attorney.   18. As held by this Court in  Church of Christ Charitable Trust vs. and   Educational   Charitable   Society     Ponniamman 3 Educational Trust  the document should expressly authorize the agent,     to execute a sale deed;     to present it for registration; (i) (ii) and  (iii)  to admit execution before the Registering Authority. 3 (2012) 8 SCC 706 13 19. It is a fundamental principle of the law of transfer of property that “ no one can confer a better title than what he himself has ” ( Nemo dat quod non habet ). The appellant’s sister did not have the power   to   sell   the   property   to   the   vendors   of   the   respondent. Therefore, the vendors of the respondent could not have derived any valid   title   to   the   property.   If   the   vendors   of   the   respondent themselves did not have any title, they had nothing to convey to the respondent, except perhaps the litigation. 20. Therefore, the appeal is allowed, the impugned judgment of the High Court is set aside and the Judgment and preliminary decree passed by the trial Court are restored.  There will be no order as to costs.  …..…………....................J.       (Hemant Gupta) .…..………......................J (V. Ramasubramanian) APRIL 1, 2022 14 NEW DELHI. 15