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

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

Landmark Cases of India / सुप्रीम कोर्ट के ऐतिहासिक फैसले

REPORTABLE

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

Civil Appeal No.2592 of 2022

(Arising out of Special Leave Petition (C) No.20047 of 2017) 

MRS. UMADEVI NAMBIAR         ...APPELLANT(S)

VERSUS

THAMARASSERI ROMAN CATHOLIC 

DIOCESE REP BY ITS PROCURATOR 

DEVSSIA’S SON REV. FATHER

JOSEPH KAPPIL              ...RESPONDENT(S)

J U D G M E N T

V. Ramasubramanian

1. Their suit for partition having been decreed by the trial Court

but   reversed   by   the   High   Court   in   a   regular   first   appeal,   the

plaintiffs have come up with the above appeal.

2. We have heard Shri Dushyant A. Dave, learned senior counsel

for the appellant and Shri Thomas P. Joseph, learned counsel for

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the respondent.

3. The   suit   schedule   property   originally   belonged   to   one

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

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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;  (ii)  that the general Power of Attorney

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; (v) that though the

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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; (vi) that the appellant was therefore aware of all

the transfers including the transfer in favour of the respondent and

the development made by the respondent over the suit property;

(vii)  that, therefore, the appellant is guilty of acquiescence; and

(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.

6. The trial Court framed as many as 23 issues for consideration

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

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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.

7. While reversing Judgment and decree of the trial Court, the

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; (ii) that though the

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

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would have already become time barred, by the time the Power of

Attorney was cancelled; (iv) that since the deed of general Power of

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   predecessor­ininterest 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; (ii) that the deed

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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

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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  (ii)  an   express   power   to   execute   any   document

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:

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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  (ii)  that   the   respondent

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 

xxxx xxx xxxx

“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

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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:

Provided that­­

(1)  the   instrument   has   been   registered   and   its

registration completed in the manner prescribed

by the Indian Registration Act, 1908 (16 of 1908)

and the rules made thereunder,

(2) the instrument or memorandum has been duly

entered or filed, as the  case   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

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come into effect. They are: (i) wilful abstention from an enquiry or

search; and  (ii)  gross negligence.  Explanation I  and  Explanation 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.

15. It is not always necessary for a plaintiff in a suit for partition

to seek the cancellation of the alienations. There are several reasons

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behind this principle. One is that the alienees as well as the cosharer 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.

16. The learned counsel for respondent relied upon the decision of

this Court in  Delhi   Development   Authority  vs.  Durga   Chand

Kaushish1

,   in   support   of   his   argument   about   the   rule   of

interpretation to be adopted while construing Exhibit A­1, the deed

of general Power of Attorney. He also relied upon the Judgment of

this Court in Syed Abdul Khader vs. Rami Reddy and Others2

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

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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

and   Educational   Charitable   Society  vs.  Ponniamman

Educational Trust3

 the document should expressly authorize the

agent,  (i)  to execute a sale deed;  (ii)  to present it for registration;

and (iii) to admit execution before the Registering Authority.

3 (2012) 8 SCC 706

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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

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NEW DELHI.

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