2023 (12) TMI 1423 - HC - Indian Laws

Applicability of Doctrine of priority of interest as contemplated under Section 48 of the Transfer of Property Act 1882 - power of attorney is inadmissible in evidence or not - HELD THAT - The first plaintiff claims ownership based on the sale deed dated 20.05.2004 executed by the second plaintiff based on an unregistered General Power of Attorney and affidavit. Already answered that the General Power of Attorney and the declaration of facts in the form of an affidavit are inadmissible in evidence. Now the question of priority between two registered documents is required to be considered. Where there is a competition between two registered documents (relating to the same property) both of which are registered the question of priority between them is to be determined with reference to the provisions of Section 47 of the Registration Act. If there are successive transfers of the same property the later transfer is subject to the prior transfer. Reverting to the facts of the case the sale deed in favor of the fourth defendant is dated 08.10.2003 and the sale deeds in favor of defendants 5 and 6 are dated 26.04.2004. Whereas the sale deed in favor of first plaintiff is dated 20.05.2004. The registered sale deeds in favor of defendants 4 5 and 6 were first in time than the sale deed in favor of the first plaintiff. The first plaintiff purchased the property already sold he cannot question the sale deed to be void and hence to have a mileage on the situation - The transferor cannot prejudice the rights of the transferee by any subsequent dealing with the property. Taking note of the settled proposition of law the successive transfer of the same property i.e. transfer by the second plaintiff in favor of the first plaintiff is subject to the prior transfer that was made in favor of defendants 4 5 and 6. Conclusion - Both Courts are not right in accepting the plaintiff s contention. They overlooked the settled principles and erroneously went ahead and decreed the suit. The judgments and decrees passed by the Trial Court and the First Appellate Court are unsustainable in law - the Regular Second Appeal is allowed.

Summary

ISSUES PRESENTED and CONSIDERED

The core legal questions considered in this judgment are:

1. Whether the doctrine of priority of interest as contemplated under Section 48 of the Transfer of Property Act, 1882, is applicable to the case.

2. Whether the power of attorney was inadmissible in evidence.

ISSUE-WISE DETAILED ANALYSIS

Issue 1: Applicability of Section 48 of the Transfer of Property Act, 1882

- Relevant Legal Framework and Precedents: Section 48 of the Transfer of Property Act, 1882, establishes the principle of priority of rights created by transfer, based on the maxim 'qui prior est tempore potier est jure' (he has a better title who was first in point of time). The section dictates that later created rights are subject to the rights previously created unless a special contract or reservation binds the earlier transferees.

- Court's Interpretation and Reasoning: The Court examined the sequence of transactions involving the suit property. The sale deed in favor of the fourth defendant was dated 08.10.2003, and subsequent sale deeds in favor of defendants 5 and 6 were dated 26.04.2004. The sale deed in favor of the first plaintiff was dated 20.05.2004. The Court noted that the registered sale deeds in favor of defendants 4, 5, and 6 were executed prior to the sale deed in favor of the first plaintiff.

- Application of Law to Facts: The Court applied Section 48, concluding that the first plaintiff's purchase was subject to the prior transfer made to defendants 4, 5, and 6. The first plaintiff could not claim ownership over the property already sold to others.

- Conclusion: The Court determined that Section 48 was applicable, and the first plaintiff's rights were subordinate to those of defendants 4, 5, and 6.

Issue 2: Admissibility of the Power of Attorney

- Relevant Legal Framework and Precedents: The Court considered whether the General Power of Attorney, which was not registered, could confer ownership rights. The legal precedent from the SURAJ LAMP case was referenced, which held that General Power of Attorney Sales or Sale Agreements/Wills do not convey title and are not valid modes of transfer of immovable property.

- Court's Interpretation and Reasoning: The Court noted that the General Power of Attorney and the declaration of facts (affidavit) were unregistered and thus inadmissible in evidence. The Court emphasized that a General Power of Attorney, even if coupled with interest, requires registration to confer any right of alienation.

- Application of Law to Facts: The Court found that the documents relied upon by the plaintiffs (the affidavit and General Power of Attorney) did not convey any title to the property and were inadmissible.

- Conclusion: The Court concluded that the power of attorney was inadmissible, and the plaintiffs could not establish ownership based on these documents.

SIGNIFICANT HOLDINGS

- Core Principles Established: The judgment reinforced the principle that registered documents take precedence over unregistered ones in property transactions, and that a General Power of Attorney cannot confer ownership without registration.

- Final Determinations on Each Issue: The Court set aside the judgments and decrees of the Trial Court and the First Appellate Court, ruling in favor of defendants 5 and 6. The Court held that the first plaintiff could not claim ownership of the property, as the prior registered transfers to defendants 4, 5, and 6 took precedence.