Does the POA (Power of Attorney)
transfers any right, title, or interest in an immovable property? What if such
POA (Power of Attorney) is irrevocable?
OR
Ajay Chakraborty, a resident
of Jalpaiguri District but falling in Siliguri, who was owning ½
share of land located in Fulbari under Rajganj Block of Jalpaiguri,
sold his share to Babu Ghosh, of Jalpaiguri Sadar, by the
documents like Agreement to Sell, Power of Attorney, or Will. Ajay
himself got the ½ share on 11.3.1984 by way of Agreement to Sale, Power of
Attorney, or Will in his favor by the Original Owner. Is Babu Ghosh the
owner of the ½ share?
OR
Biplab Saha, a resident of Darjeeling District of Phansidewa area of Siliguri, who was owning land located in Bagdogra sold his share to Amlan Bose, of Matigara, by Will. Biplab himself got the land on 11.9.1994 by way of Agreement to Sale, Power of Attorney, or Will in his favor by the Original Owner. Is Biplab Saha the owner of the land?
DISCUSSION AND ANSWER.
The Supreme Court has considered
the question of the validity of transactions in the form of power of attorney
in Suraj Lamp and Industries Pvt. Ltd. through Director vs. State of
Haryana & Anr. (2012) 1 SCC 656, and has held that no rights could be
accrued on such transactions as this is not a legal mode of transfer. The Apex Court
has observed :
"20. A
power of attorney is not an instrument of transfer in regard to any right,
title, or interest in an immovable property. The Power of Attorney is a
creation of an agency whereby the grantor authorizes the grantee to do the acts
specified therein, on behalf of the grantor, which when executed will be
binding on the grantor as if done by him (see, Section 1A and Section 2
of the Powers of Attorney Act, 1882). It is revocable or terminable at any time
unless it is made irrevocable in a manner known to law. Even an irrevocable
attorney does not have the effect of transferring title to the grantee.
21. In-State
of Rajasthan vs. Basant Nehata 2005 (12) SCC 77 this Court held:
"13. A
grant of power of attorney is essentially governed by Chapter X of the Contract
Act. By reason of a deed of power of attorney, an agent is formally appointed
to act for the principal in one transaction or a series of transactions or to
manage the affairs of the principal generally conferring necessary authority
upon another person. A deed of power of attorney is executed by the principal
in favor of the agent. The agent derives a right to use his name and all acts,
deeds, and things are done by him and subject to the limitations contained in
the said deed, the same shall be read as if done by the donor. A power of
attorney is, as is well known, a document of convenience.
Execution of a
power of attorney in terms of the provisions of the Contract Act as also the
Powers-of-Attorney Act is valid. A power of attorney, we have noticed
hereinbefore, is executed by the donor so as to enable the done to act on his
behalf. Except in cases where power of attorney is coupled with an interest,
it is revocable. The donee in exercise of his power under such power of
attorney only acts in place of the donor subject, of course, to the powers
granted to him by reason thereof. He cannot use the power of attorney for his
own benefit. He acts in a fiduciary capacity. Any act of infidelity or
breach of trust is a matter between the donor and the done.
An attorney
holder may, however, execute a deed of conveyance in the exercise of the power
granted under a power of attorney and convey title on behalf of the grantor.
Scope of Will
A will is the testament of the
testator. It is a posthumous disposition of the estate of the testator
directing the distribution of his estate upon his death. It is not a transfer inter
vivo. The two essential characteristics of a will are that it is intended
to come into effect only after the death of the testator and is revocable at
any time during the lifetime of the testator. It is said that so long as the
testator is alive, a will is not beworth the paper on which it is written, as
the testator can at any time revoke it. If the testator, who is not married,
marries after making the will, by operation of law, the will stands revoked.
(see Sections 69 and 70 of the Indian Succession Act, 1925). Registration of a
will does not make it any more effective.
Conclusion
Therefore, a Special Power of Attorney/General
Power of Attorney/WILL transaction does not convey any title nor create any
interest in an immovable property. The observations by the Delhi High Court, in
Asha M. Jain vs. Canara Bank 94 (2001) DLT 841 that the "concept
of power of attorney sales have been recognized as a mode of transaction"
when dealing with transactions by way of SA/GPA/WILL are unwarranted and not
justified, unintended misleading the general public into thinking that SA/GPA/WILL
transactions are some kind of a recognized or accepted mode of transfer and
that it can be a valid substitute for a sale deed. Such decisions to
the extent they recognize or accept SA/GPA/WILL transactions as concluded
transfers, as contrasted from an agreement to transfer, are not good law.
We will draw our conclusion from paras
16 and 17 of the recent judgment of the Supreme Court in Shiv Kumar &
Anr. vs. Union of India and Ors. 2019 0 AIR(SC) 5374; 2019 10
SCC 229, (3 Judges Bench) :
Para 16.
We, therefore, reiterate that immovable property can be legally and lawfully
transferred/ conveyed only by a registered deed of conveyance. Transactions
of the nature of 'GPA sales' or 'SA/GPA/WILL transfers' do not convey title and
do not amount to transfer, nor can they be recognized or valid mode of transfer
of immovable property. The courts will not treat such transactions as
completed or concluded transfers or as conveyances as they neither convey title
nor create any interest in an immovable property. They cannot be recognized as
deeds of title, except to the limited extent of Section 53A of the Transfer of
Property Act. Such transactions cannot be relied upon or made the basis for
mutations in Municipal or Revenue Records. What is stated above will
apply not only to deeds of conveyance in regard to freehold property but also
to transfer of leasehold property. A lease can be validly transferred
only under a registered Assignment of Lease. It is time that an end is put
to the pernicious practice of SA/GPA/WILL transactions known as GPA sales.
Para 17.
It has been submitted that making declaration that GPA sales and SA/GPA/WILL
transfers are not legally valid modes of transfer is likely to create hardship
to a large number of persons who have entered into such transactions, and they
should be given sufficient time to regularize the transactions by obtaining
deeds of conveyance. It is also submitted that this decision should be made
applicable prospectively to avoid hardship.” No right can be claimed based
on a transfer made by way of execution of Power of Attorney, Will, etc., as it
does not create any interest in immovable property.
Answer to Question II.
Ajay Chakraborty, a resident of
Jalpaiguri District falling in Siliguri, who was owning ½ share of land located
in Fulbari under Rajganj Block of Jalpaiguri, sold the share to Babu Ghosh, of
Jalpaiguri Sadar, by the documents like Agreement to Sell, Power of Attorney,
or Will. Ajay himself got the ½ share on 11.3.1984 by way of Agreement to Sale,
Power of Attorney, or Will in his favor by the Original Owner,. The purchase
made through Agreement to Sale, Power of Attorney, or Will by Ajay did not
confer a title upon him to transfer it to Babu Ghosh. Based on purchase made
from such owners whose title was not perfect, Babu Ghosh had no derivative
title in the eye of law. There was no legally recognized title deed in favor of
Ajay Chakraborty in the first place. A person cannot bequeath a better title
than what he has. Therefore no title accrues in favour of Babu Ghosh.
Answer to Question III.
Biplab Saha, a resident of Darjeeling District of Phansidewa area of Siliguri, who was owning land located in Bagdogra sold his share to Amlan Bose, of Matigara, by Will. Biplab himself got the land on 11.9.1994 by way of Agreement to Sale, Power of Attorney, or Will in his favor by the Original Owner. For the same reasons as stated above in reply to Question II, Biplab acquires no Right, Title or Interest in the Land.
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