The Supreme Court has held that a Will or General Power of Attorney (“GPA”) cannot be recognized as title documents or documents conferring right in any immovable property. It has been further held that the non-execution of any document by the GPA holder consequent to it, rendering the said GPA useless.

The Bench consisting of Justice Dipankar Datta and Justice Pankaj Mithalwhile adjudicating the appeal Ghanshyam v Yogendra Rathihas held as under:

“In connection with the general power of attorney and the will so executed, the practice, if any, prevalent in any State or the High Court recognizing these documents to be documents of title or documents conferring right in any immovable property is in violation of the statutory law. Any such practice or prevalent tradition would not override the specific provisions of law which require the execution of a document of title or transfer and its registration so as to confer rights and titles in an immovable property of over Rs. 100/- in value.”

BACKGROUND FACTS

Mr. Ghanshyam (“Appellant”) was the owner of a property situated in Delhi (“Suit Property”). He entered into an Agreement to Sell dated 10.04.2002 with Mr. Yogendra Rathi (“Respondent”) for the sale of Suit Property and received the entire sale consideration from the Respondent. On the same day, the Appellant executed a will bequeathing the Suit Property to the Respondent. The Appellant further executed a General Power of Attorney in favor of the Respondent. The possession of the Suit Property was handed over to the Respondent, however, no sale deed was executed.

The Respondent permitted the Appellant to occupy a portion of the Suit Property for 3 months as a licensee. After expiry of 3 months period, the Appellant did not vacate the Property. The Respondent filed a suit against the Appellant seeking the latter’s eviction from the Suit Property and recovery of mesne profits.

The Respondent claimed his ownership on the Suit Property on the strength of the Agreement to Sell dated 10.04.2002, General Power of Attorney, memo of possession, receipt of payment of sale consideration and a will dated 10.04.2002.

The Appellant argued that the documents cited by the Respondent had been manipulated on blank papers. However, there was no evidence to that effect. The Appellant did not dispute the execution of such documents or receipt of sale consideration by him.

The Trial Court held that there was no manipulation of documents and thus the Respondent is entitled to decree for eviction and recovery of mesne profits.

The Appellant filed a first appeal and thereafter a second appeal before the High Court and both were decided in favor of the Respondent. Subsequently, the Appellant filed an appeal before the Supreme Court.

SUPREME COURT VERDICT

The Bench noted that an Agreement to Sell is neither a document of title nor a deed of transfer of property by sale. Therefore, it does not confer any absolute title upon the Respondent over the Suit Property, in view of Section 54 of the Transfer of Property Act, 1882. However, the factors such as entering into an Agreement to Sell, payment of entire sale consideration and being put in possession by the transferor, showing that the Respondent has de-facto possessory rights based on his part performance of the Agreement to Sell.

The possessory right of the Respondent is not liable to be disturbed by the transferer (Appellant). It was further observed that the Appellant’s entry into the Property Suit afterward was as a licensee of the Respondent and not as the owner of the Property.

A will have no force during the life of the executant

On the issue of whether any title can be conferred through Will, the Bench opinioned that a Will comes into effect only after the death of the executant. Since a will have no force during the life of the executant, the Appellant’s will did not confer any right upon the Respondent. It was observed as under:

“Similarly, the will dated 10.04.2002 executed by the defendant-appellant in favor of the plaintiff-respondent is meaningless as the will, if any, comes into effect only after the death of the executant and not before it. It has no force until the testator or the person making it dies. The said stage has not arrived in the present case and, therefore, even the aforesaid will in no way confess any right upon the plaintiff-respondent.”

A Will or General Power of Attorney cannot be recognized as title documents or documents conferring right in any immovable property

It was observed that the General Power of Attorney executed by the Appellant was inconsequential, since neither sale deed has been executed nor has any action been taken by the General Power of Attorney holder which may confer title upon the Respondent. “Non-execution of any document by the general power of attorney holder consequent to it renders the said general power of attorney useless”, the Bench held.

Further, the Bench deprecated the practice of recognizing the General Power of Attorney or will as title documents.

“In connection with the general power of attorney and the will so executed, the practice, if any, prevalent in any State or the High Court recognizing these documents to be documents of title or documents conferring right in any immovable property is in violation of the statutory law. Any such practice or prevalent tradition would not override the specific provisions of law which require the execution of a document of title or transfer and its registration so as to confer rights and titles in an immovable property of over Rs.100/- in value”, the Bench ruled.

The Bench placed reliability on the judgment in Suraj Lamp & Industries Pvt. Ltd. vs. State of Haryana & Anr., (2009) 7 SCC 363, wherein the Supreme Court deprecated the transfer of immovable property through a sale agreement, general power of attorney and will instead of a registered conveyance deed.

The Bench upheld the High Court’s view that the Respondent is entitled to a decree for eviction with mesne profits.

Case Title: Ghanshyam V Yogendra Rathi

Citation: 2023 LiveLaw (SC) 479

Counsel for Appellant: Shri Rajul Shrivastav

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