Deepa Sharma KP
DETAILS OF THE CASE
| Case Title: | Shyam Kumar Irani v. Vinod Agarwal & Others |
| Case Number: | Civil Appeal No. 2845/2015 |
| Bench: | Justice Vikram Nath and Justice Prashanth Kumar Mishra |
| Citation: | 2024 INSC 865 |
| Court: | Supreme Court of India |
BACKGROUND OF THE CASE
With property transactions getting rampant day by day, so are the legal confusions and legal hurdles in the field of property laws. In the event of the sale and purchase of properties, the sale agreement plays a pivotal role as it mentions the parties, the value of the property, the method of transaction, the rights and obligations of the parties entering into the agreement, and such other crucial clauses necessary for smooth property transactions.
In certain cases, the parties entering into a transaction with respect to properties may choose to do so through their representatives or may even appoint a power of attorney to execute the procedure. A power of attorney acts as an agent to the owner of the property who represents the latter in dealings with third parties. Precisely, a power of attorney is simply an instrument that creates an agency .
In a recent case before the Hon’ble Supreme Court, while addressing a suit for specific performance of a contract where the six appellants were the plaintiffs, the suit was decreed in the Trial Court. However, the High Court allowed the appeal, set aside the Trial Court’s order, and dismissed the suit. On appeal, the Hon’ble Supreme observed that ‘it is not necessary for every plaintiff to prove the execution of a sale agreement if another plaintiff possessing first-hand knowledge proves such execution”.
FACTS OF THE CASE
The present case relates to agricultural lands measuring 23.98 acres bearing Khasara Nos. 546, 547 and 548 situated in Godar Mau village, Bhopal District, Madhya Pradesh. An area measuring 27.56 acres of the aforesaid three Khasara numbers was purchased by one Sushila Bai, wife of late Chandra Mal Aggarwal, vide registered sale deed dated 29.04.1966 executed by former owner Vijay Chhatti for a sale consideration of Rs.7,000/-. Based on the said instrument of transfer, Sushila Bai’s name was mutated in land revenue records. Sushila Devi was the owner of the suit schedule property. She later entered into an Agreement to Sell with each of the appellants separately after receiving the entire sale consideration. The appellants had taken over actual possession and having paid the entire sale consideration, the suit schedule property was agricultural land and cultivated by the appellants.
The defendants are the legal heirs of late Sushila Bai and the said Agreement to Sell was binding upon them. However, the defendants declined to fulfil their legal obligation to execute the instrument in favour of the appellants and instead applied for mutation for the suit schedule property. The appellants raised objections for the same and vide notice dated 28.04.1994 called upon the defendants to execute the sale deed. However, the same was not honoured. Thus, the appellants instituted six separate Civil Suits, seeking a decree for specific performance of an Agreement to Sell dated 30.08.1990, against the defendants (legal heirs of Sushila Devi) thereby compelling them to execute the sale deed in accordance with the said agreement.
The defendants objected, contending that the agreement was not proved as one of the plaintiffs, i.e., the appellant, had not testified and that the said instrument is forged. However, the plaintiff (the appellant) denying the allegations of forgery further contended that his absence should not result in an adverse inference because his Power of Attorney, who is also one of the plaintiffs, had testified to the agreement’s execution.
Vide judgement dated 14.05.2001, The Trial Court, decreed all the suits. Aggrieved by this, the defendants filed an appeal in the High Court under section 96 of the Code of Civil Procedure, 1908 where, by the impugned judgment, the High Court allowed all the six appeals and set aside the judgment of the Trial Court thereby dismissing the suits. Aggrieved by the same, the plaintiffs filed an appeal in the Hon’ble Supreme Court. Nevertheless, the defendant’s claim was that a power of attorney holder has no right and thus cannot testify on matters that are within the personal knowledge of the principal. The defendants cited various judgments where the Hon’ble Court has held that a ‘power of attorney cannot supplant on behalf of the principal with respect to matters which are within the personal knowledge of the principal.
ISSUES RAISED
1. Whether the Agreement to Sell dated 13.08.1990 was validly executed and proved?
2. Whether the plaintiffs not entering into the witness box in five of the suits would call for an adverse inference, although their Power of Attorney had entered the witness box?
JUDGEMENT AND REASONING OF THE CASE
The decision in the present case was delivered by a bench comprising of comprising Justice Vikram Nath and Justice Prashanth Kumar Mishra. With regard to the first issue, the Hon’ble Apex Court held that ‘from the evidence on record and after kind perusal with respect to the execution of Agreement to Sell, we are of the view that the same had been validly proved by the plaintiff/appellants and the defendants had failed to establish their claim that it was a forged document’. The Bench clearly stated that the absence of a plaintiff should not be viewed captiously as another plaintiff’s testimony can substantively prove the claims of the plaintiffs in absentia.
The Hon’ble Supreme Court, focusing on the distinct circumstance, observed that the principles established in the cases cited by the defendants do not apply in the instant case and thereby accepted the appellant’s argument and held that the presence of the Power of Attorney holder at the time of execution of the agreement is sufficient proof that clearly establishes the plaintiff’s case via credible witnesses with firsthand knowledge. Supreme Court clarifies, “Every plaintiff to the suit need not prove execution of Sale Agreement if another plaintiff with firsthand knowledge proves such execution”.
Thus, the Hon’ble Apex Court held in favor of the appellant, thereby reversing the High Court’s judgment and upholding the Trial Court’s decree for specific performance of the contract. The court further declared the defendants to execute the sale deed and also declared the concurrent sales to be void, thereby reinforcing the appellant’s right to specific performance of the original agreement.