In the High Court of Judicature at Madras Dated: 20.9.2010 Coram: THE HONOURABLE MR.JUSTICE M.JAICHANDREN S.A.No.1052 of 2009 1. Nagammal 2. R.Ravichandran 3. R.Shanmugasundaram 4. R.Prakash .. Appellants vs. 1. K.Thangavel 2. Sree Kaliappan Trust rep. through its Trustee K.Thangavelu 3. D.Radha 4. Koundammal 5. N.Veerammal 6. R.Nanjappan 7. Pankajam 8. A.Jayapal 9. A.Shanmugam A.Duraisamy (died) 10.A.Balakrishnan @ Balu 11.A.Saraswathi 12.A.Shantamani 13.A.Kanagamani 14.A.Nirmaladevi 15.A.Annapoorani 16.Gandhimadhi 17.Jayalakshmi 18.Karthik .. Respondents The Second Appeal has been filed against the judgment and decree, dated 31.7.2009, made in A.S.No.107 of 2007, on the file of the 1st Additional Subordinate Court, Coimbatore, confirming the judgment and decree, dated 30.10.2006, made in O.S.No.3987 of 2004, on the file of the II Additional District Munsif Court, Coimbatore. For Appellants : Mr.T.R.Rajagopalan Senior Advocate for Mr.T.R.Rajaraman For Respondents : Mr.N.Chandraraj for M/s.Raj & Raj Associates J U D G E M E N T
This second appeal has been filed against the judgment and decree, dated 31.7.2009, made in A.S.No.107 of 2007, on the file of the 1st Additional Subordinate Court, Coimbatore, confirming the judgment and decree, dated 30.10.2006, made in O.S.No.3987 of 2004, on the file of the II Additional District Munsif Court, Coimbatore.
2. The defendants 11 to 14 in the suit, in O.S.No.3987 of 2004, are the appellants in the present second appeal. The plaintiffs in the said suit are the respondents herein. The suit, in O.S.No.3987 of 2004, had been filed, praying for a decree of declaration, declaring that the sale deeds, under document Nos.1365 of 1998 and 1367 of 1998, made in favour of the defendants 11 to 14 are fraudulent, invalid and not binding on the plaintiffs, and for a further declaration that the plaintiffs 2, 3 and 6 are the absolute owners of the suit property mentioned under schedules I to III, and for a consequential permanent injunction restraining the defendants 11 to 14 from interfering with the peaceful possession and enjoyment of the properties, by the plaintiffs 2, 5 and 6, and for costs.
3. It has been stated that the property, morefully described in the schedules I to III of the plaint had, originally, belonged to one Arumuga Asari, son of Karuppanna Asari, under a registered sale deed, dated 11.4.1960, under document No.4564 of 1960. Arumuga Asari had executed an agreement for sale in favour of the first plaintiff, K.Thangavelu, on 17.8.1990, in respect of the agricultural land, with an extent of 6.46 acres, agreeing for the price at the rate of Rs.50,000/- per acre, and having a received a sum of Rs.20,000/-, as advance, on the said date. Arumuga Asari had also received various amounts of money, on different dates, between 23.11.1990 and 24.4.1992, and had made endorsements on the various dates, on the back of the original agreement for sale.
4. It had also been stated that Arumuga Asari had also executed a general power of attorney in favour of the first plaintiff, authorising him to deal with the said land, as per the terms and conditions mentioned therein. The said document had been registered, on 24.4.1992, as document No.146 of 1992, in book IV.
5. It had also been stated that, on 24.4.1992, Arumuga Asari and his sons and daughters, who are the defendants 1 to 10 in the suit, had also executed a confirmation letter, confirming the agreement for sale executed by Arumuga Asari and the receipt of the entire sale consideration of Rs.3,23,000/-. They had also agreed not to revoke the general power of attorney executed in favour of the first plaintiff. The said defendants, along with Arumuga Asari, had handed over the possession of the lands in question, pursuant to the earlier agreement for sale. They had also handed over the original title deed, dated 11.4.1960 and other related documents, like, Patta, passbook, kist receipts, Chitta and adangal etc. Thus, the agreement for sale and the general power of attorney had become irrevocable, as it was coupled with interest. The defendants 1 to 10 and the said Arumuga Asari had received the entire sale price.
6. It had also been stated that the trust had come into existence in the name of Sree.Kaliappa Trust. The plaintiffs 1, 3 and 4 are the trustees of the 2nd plaintiff trust. The trust deed had been registered, as document No.41 of 1992. The first plaintiff, as the power of attorney, had executed a settlement deed in favour of Sree. Kaliappa Trust, in respect of 5 acres of land mentioned in schedule I. The settlement deed had been registered as document No.5159 of 1993, and the possession of the land had also been delivered to the said trust.
7. It has been further stated that two other sale deeds had also been executed by the first plaintiff, in respect of schedule II and schedule III mentioned properties, in favour of the plaintiffs 5 and 6, under document Nos.1604 of 1997 and 1605 of 1997, respectively. The purchasers are in actual possession and enjoyment of the said land.
8. It had also been stated that the first plaintiff, after the agreement for sale and after taking possession of the property in question, mentioned in the suit schedule, had leveled the land, closed the pits and removed the big stones from the said lands at heavy costs. Likewise, the 2nd plaintiff trust, after the settlement made in its favour, and after taking possession of the said land, had put up sheds and had also sunk a borewell at a huge cost. It had also applied for electricity power connection to the Tamil Nadu Electricity Board, to irrigate its agricultural lands and had deposited the amount of Rs.10,000/-. The 2nd plaintiff had also been paying the annual minimum charges of Rs.2,500/-, every half yearly. The 2nd plaintiff had also applied for approval from the central Government and the Bharathiyar University, to start a Dental and Arts and Science college in a portion of land, in item No.1 of the suit schedule.
9. It had also been stated that the Tamil Nadu Housing Board had also proposed to acquire the land mentioned in the plaint along with certain other lands and they had issued notices under Sections 4(1) and 5(A) of the Land Acquisition Act. The plaintiffs 1 and 2 had filed the writ petitions in the High Court of judicature, at Madras, in W.P.Nos.17239 of 1997 and 17240 of 1997, for quashing the order issued by the Government, in view of the acquisition proceedings. The High Court had directed the 2nd plaintiff to approach the State Government for exclusion of its land, for starting the Dental College and the Arts and Science college. Accordingly, the 2nd plaintiff had applied to the State Government for exemption of its lands, for the purpose of starting the educational institutions. The 2nd plaintiff had been paying the land kists and other taxes and is also in actual physical possession and enjoyment of the lands mentioned in the suit schedules, in its own right. Similarly, the plaintiffs 5 and 6 are also in possession of the land purchased by them, from the 1st plaintiff.
10. It had also been stated that the plaintiffs had come to know that the defendants 1 to 10, as legal heirs of Arumuga Asari, had, fraudulently and in a collusive manner, had executed a sale deed, on 12.6.1998, in document Nos.1366 of 1998 and 1367 of 1998, in favour of the defendants 11 and 12 and also in favour of the defendants 13 and 14, respectively, in respect of the suit schedule lands. The plaintiffs had no knowledge about the death of Arumuga Asari till they came to know about it, after the execution of the sale deeds, by the defendants 1 to 10, in favour of the defendants 11 to 14. The sale deeds executed by the defendants 1 to 10, in favour of the defendants 11 to 14, are fraudulent, invalid and not binding on the plaintiffs. The defendants 11 to 14 did not derive any right, title or ownership, by way of the said sale deeds, and they were not given physical possession of the landed property.
11. It had also been stated that the defendants 1 to 10 and 11 to 14 had acted hand-in-glove with each other, in causing loss to the plaintiffs. The defendants 11 to 14 are not the bona fide purchasers, for a valid consideration. The plaintiffs are entitled to the declaration for the lands in suit schedules I to III belonging to the plaintiffs 2, 5 and 6, respectively. The plaintiffs are also entitled to a declaration that the sale in favour of the defendants 11 to 14 are fraudulent, collusive and not binding on the plaintiffs, and for a consequential injunction restraining the defendants 11 to 14 from interfering with the plaintiffs’ peaceful possession and enjoyment of the properties in question.
12. In the written statement filed by the defendants 1 to 6 and 8 to 10, the averments and allegations made in the plaint had been denied. The allegation that Arumuga Asari had executed an agreement for sale, in respect of the suit properties, on 17.8.1990, and had received a sum of Rs.20,000/- as advance, had been specifically denied. Further, the allegation that Arumuga Asari had received various sums of money on different dates and had made endorsements in the said agreement, is false. The said documents are forged and fraudulent documents. Even a cursory look at the documents would clearly reveal that all the signatures in the alleged agreement of sale are forged and fabricated. The claim of the plaintiffs that Arumuga Asari had executed a power of attorney, on 24.4.1992, and the issuance of the confirmation letter, dated 24.4.1992, had also been denied.
13. It had also been stated that Arumuga Asari had died, on 25.7.1993, intestate. After his death, his wife Pankajam and and his sons and daughters had sold the property to Nagammal, Ravichandran, Shanmugasundaram and Prakash, under three sale deeds, and had also delivered to them the possession of the property. Thereafter, Duraisamy, the fourth defendant had died.
14. It had also been stated that the alleged power of attorney had become inoperative, on 25.7.1993, on the death of Arumuga Asari. The document created, on 25.7.1993, and on the subsequent dates, had become unsustainable and inoperative, as the first respondent Thangavel has no right, title or interest in the property in question. Hence, there is no cause of action for the suit and therefore, the suit filed by the plaintiffs is liable to be rejected. In fact, the first defendant had suppressed the death of Arumuga Asari and had fraudulently created a trust, appointing himself as a trustee, to take away the entire suit property, by fraudulent means.
15. It had been stated that the defendants 1 to 6 and 8 to 10 had sold the properties to defendants 11 to 14, after the receipt of the sale price amount and had also delivered the possession of the suit properties in question. In such circumstances, the suit filed by the plaintiffs is liable to be dismissed, in limine, with costs.
16. In the written statement filed on behalf of the defendants 11 to 14, it has been stated that the suit filed by the plaintiffs is false, frivolous, vexatious and not maintainable, both in law and on the facts of the case. The averments and allegations made in the plaint had been denied, as false and unsustainable. The claim made by the plaintiffs that Arumuga Asari had entered into an agreement for sale and had also made various endorsements on different dates, by receiving various amounts, is incorrect and false.
17. It had also been stated that Arumuga Asari had not executed a power of attorney in favour of the first plaintiff. Further, the alleged power of attorney is invalid and inoperative. Further, the claim that, on 24.4.1992, Arumuga Asari, along with the defendants 1 to 10, had executed a confirmation letter, confirming the agreement of sale, on receipt of the entire sale price of Rs.3,23,000/-, is denied as false. The said document is a forged one.
18. It has been further stated that in the normal course, if an owner of the property had entered into an agreement of sale and had received the entire sale price, no confirmation letter, confirming the agreement of sale and the receipt of the entire sale price, by the owners of the lands and his sons and his daughters, is necessary. The act of issuing of a confirmation letter would, by itself, be sufficient to show the false nature of the transaction. The claim that they had agreed not to revoke the general power of attorney is false and unsustainable.
19. It has been further stated that the property had never been handed over to the first plaintiff. The first plaintiff and the other plaintiffs are not in possession of the suit properties. The original title deed and the other documents had not been handed over to the first plaintiff, as alleged in the plaint. The allegation that the agreement for sale and the general power of attorney had become irrevocable, since, it is coupled with interest, is neither true nor sustainable in the eye of law. The allegation that Arumuga Asari and the defendants 1 to 10 had received the entire sale price is false, incorrect and unsustainable. The allegation that the first plaintiff had taken possession of the properties in question, in part performance of the agreement for sale, is neither true nor valid. In fact, it is the defendants 11 to 14, who have been in possession and enjoyment of the properties, as their true and legal owners. The alleged trust deed is also a concocted document. The plaintiffs had suppressed the fact that Arumuga Asari had died, on 25.7.1993.
20. It has been further stated that the claim that the first plaintiff, as the power of attorney agent, had executed a settlement deed in favour of the 2nd plaintiff, in respect of the suit schedule property, is unsustainable and invalid in the eye of law. The allegation that the possession of the land had also been delivered to the second respondent, is neither true nor correct. In fact, the settlement deed had been executed only after the death of Arumuga Asari. The settlement deed had been presented before the Sub Registrar for registration only, on 15.9.1993, long after the death of Arumuga Asari. Arumuga Asari was not living, either on the date of the execution of the alleged settlement deed, or on the date of the presentation of the document, for registration. As such, the alleged settlement deed, said to have been registered as document No.5159 of 1993, is void ab-initio. The alleged documents would not confer any right or title or interest in the 2nd plaintiff. The plaintiffs had not come before the Court of law, with clean hands. Since, the vendor had no right, title or interest in the properties in question, he cannot pass on a better title than what he had, at the relevant point of time.
21. It has been further stated that the alleged settlement deed and document Nos.5159 of 1993, 1604 of 1997 and 1605 of 1997, are to be ignored, as void. The plaintiffs 2, 5 and 6 were never in possession and enjoyment of the suit property. They cannot be in legal possession and enjoyment of the suit properties. The claim that the first plaintiff was in possession and enjoyment of the suit properties and that he had made certain improvements therein, at a huge costs, is incorrect and false. The second plaintiff had not taken possession of the suit properties. The claims that it had put up sheds and had also sunk a borewell at an enormous cost, and that it had applied for electricity power connection, by depositing a certain amount of money and that it has been paying the actual minimum charges, are false.
22. It has been further stated that the claim that an application had been made to the Central Government and to the Bharathiar University, to start a Dental, Arts and Science College, would not support the case of the plaintiffs. The notice issued under the Land Acquisition Act and the orders passed by the High Court of Judicature at Madras, in the writ petitions, in W.P.Nos.17239 of 1997 and 17240 of 1997, would not confer any right or title to the plaintiffs in the suit properties.
23. It had also been stated that it is true that the defendants 1 to 10, as the legal heirs of Arumuga Asari had validity executed the sale deeds in favour of the defendants 11 to 14. There is no fraud or collusion amongst the defendants. Arumuga Asari had died, intestate, leaving behind the defendants 1 to 10, as his legal heirs, to succeeded to the suit properties. The sale deeds in favour of the defendants are true, valid and binding on all the persons concerned. The sale deeds had been executed for valid consideration. The first plaintiff cannot claim ignorance about the death of Arumuga Asari, as he had attended the funeral of Arumuga Asari. The sale deeds executed by the defendants 1 to 10, in favour of the defendants 11 to 14, are true, valid and binding on all the plaintiffs. As such, the defendants 11 to 14 would derive valid right, title and interest in the land properties in question, by way of the sale deeds executed in their favour.
24. It has been further stated that the defendants 11 to 14 had been put in physical possession of the suit properties, by the defendants 1 to 10. The defendants 11 to 14 are bona fide purchasers of the suit properties, for valuable consideration. The said defendants did not know the alleged settlement deed, or the other documents created by the first plaintiff, in respect of the suit properties. The document created by the first plaintiff, in collusion with the other plaintiffs, is neither valid, nor bona fide in nature. They will not confer any right, title or interest or ownership to the plaintiffs, in respect of the suit properties. In such circumstances, the plaintiffs are not entitled to any declaration in respect of the suit properties, nor are they entitled for a decree of injunction, as prayed for in the suit. Further, no cause of action had arisen for the filing of the suit, by the plaintiffs. Hence, the suit is liable to be dismissed, with costs.
25. In the written statement filed on behalf of the defendants 15 to 17, the claims and allegations made on behalf of the plaintiffs had been denied. It had also been stated that the allegation that Arumuga Asari had executed an agreement for sale, on 17.8.1990, in respect of the suit properties, after receiving a certain sum of the money, had been denied.
26. It has been stated that the document said to have been executed by Arumuga Asari, on 17.8.1990, is a forged and fabricated document. The claim that Arumuga Asari had executed a power of attorney,on 24.4.1992, and the confirmation letter, dated 24.4.1992, said to have been issued on the same date,is incorrect and false.
27. It had also been stated that the alleged power of attorney would become inoperative after the death of Arumuga Asari, on 25.7.1993. Further, the first plaintiff had forged the signatures of Arumuga Asari and had created the alleged documents. As such, the suit has been filed with a mala fide motive and with fraudulent intentions. Therefore, the suit is misconceived and deserves to be dismissed.
28. In view of the averments made on behalf of the plaintiffs, as well as the defendants, the trial Court had framed the following issues for consideration:
“1. Whether it is correct to state that the defendants 1 to 10 and their father had issued a letter, dated 24.4.1992, confirming the agreement for sale, after having received Rs.3,23,000/-?
2. Whether the sale deeds under document Nos.1366 of 1998 and 1367 of 1998 in the name of the defendants 11 to 14 are valid?
3. Whether the suit schedule 1 to 3 properties belong to the defendants 2, 5 and 6 exclusively?
4. Whether the plaintiffs are entitled to the relief of declaration, as prayed for by them?
5. Whether the plaintiffs are entitled to the relief of permanent injunction, as prayed for by them?
6. What other reliefs?”
29. Three witnesses had been examined, as P.W.1 to P.W.3, and Exhibits A.1 to A.33 had been marked on behalf of the plaintiffs. Two witnesses had been examined on behalf of the defendants, as D.W.1 and D.W.2, and Exhibits B.1 to B.24 had been marked on behalf of the defendants.
30. The trial Court had noted that the first plaintiff had been examined as P.W.1. In the evidence adduced by P.W.1, it had been stated that Arumuga Asari, his wife and children, who are the defendants 1 to 10 in the suit, had, together, executed an agreement for sale, dated 17.8.1990, marked as Exhibit A.1. In the said agreement for sale, it has been stated that the sale would be executed, within 6 months thereafter. An initial advance of Rs.20,000/- had been taken by Arumuga Asari. Thereafter, various amounts had been received, on different dates and extension of time for the execution of the sale deed had also been granted.
31. The trial Court had also noted that, it was the claim of the first plaintiff that, on payment of the full consideration of Rs.3,22,000/-, on 24.4.1992, Arumuga Asari, had executed Exhibit A.2, a power of attorney in his favour. On the same day, Arumuga Asari, his wife and children had issued a confirmation letter in his favour, marked as Exhibit A.3. In the said letter, it had been assured that the general power of attorney granted, in favour of the first plaintiff, would not be revoked.
32. It had also been noted that the first plaintiff had claimed that, on the same day, when the confirmation letter, marked as Exhibit A.3, had been given, Arumuga Asari, had handed over the chitta and the kists receipts, relating to the property in question, to the first plaintiff and the possession of the property had also been given to him. Thereafter, the first plaintiff, as the power of attorney, had executed a settlement deed, in favour of Sree Kaliappan Trust, in respect of five acres of land mentioned in the suit first schedule. The settlement deed had been registered as document No.51 and the possession of the said property had also been handed over to the said Trust.
33. The trial Court had also noted that the first plaintiff had claimed that he had executed two other sale deeds in respect of the properties mentioned in the suit second and third schedules in favour of the plaintiffs 5 and 6 under document Nos.1604 of 1997 and 1605 of 1997, respectively. After the said sale had been executed, the purchasers were put in actual possession and enjoyment of the said land. As such, the 2nd plaintiff and the plaintiffs 5 and 6 have been in possession and enjoyment of the lands mentioned in the suit schedule after having purchased the same from the first plaintiff. While so, the defendants 1 to 10, as the legal heirs of Arumuga Asari, had colluded and had executed the sale deeds, on 12.6.1998, in document Nos.1366 of 1998 and 1367 of 1998, in favour of the defendants 11 to 14, fraudulently.
34. It is the claim of the plaintiffs that the sale deeds executed by the defendants 1 to 10, in favour of the defendants 11 to 14, are invalid and therefore, they were not binding on the plaintiffs. As such, the defendants 11 to 14 had not derived any right or title, in respect of the properties in question.
35. While considering the claims of the plaintiffs, in view of the evidence adduced on their behalf, the trial Court had found that the sale deeds, bearing document Nos.1366 of 1998 and 1367 of 1998, cannot be held to be valid, in view of the fact that Arumuga Asari had executed an agreement for sale in favour of the first plaintiff, on 17.8.1990, marked as Exhibit A.1. Thereafter, Arumuga Asari had executed a general power of attorney, dated 24.4.1992, marked as Exhibit A.2, to deal with the property in question, after having received the entire sale consideration of Rs.3,22,000/-. Thereafter, a confirmation letter, dated 24.4.1992, marked as Exhibit A.3, had been given to the first plaintiff signed by Arumuga Asari and the defendants 1 to 10. Only thereafter, the defendants 1 to 10 had sold the suit properties, in favour of the defendants 11 to 14. As such, the sale, made in favour of the defendants 11 to 14, cannot be held to be valid.
36. The trial Court had found that the original documents relating to the suit property had been filed on behalf of the plaintiffs and that, from the evidence of P.W.3, it could be found that the said documents filed on behalf of the plaintiffs were the original documents. It had also been found that Arumuga Asari had handed over the original documents relating to the suit property to the first plaintiff, after having received the entire sale consideration. Further, the general power of attorney had also been given to the first plaintiff to deal with the suit property. Arumuga Asari and his legal heirs, who are the defendants 1 to 10 in the suit, had also given a confirmation letter, in favour of the first plaintiff. Even though it had been claimed, on behalf of the defendants, that the original documents had been handed over to the first plaintiff after they had been stolen, such a statement had not been made in the written statement filed on their behalf. Further, the trial Court had also rejected the contention raised on behalf of the defendants that the first plaintiff had known about the death of Arumuga Asari, on 25.7.1993, as he had attended the funeral of Arumuga Asari.
37. The trial Court had also rejected the claim of the defendants that the first plaintiff had, fraudulently, created a settlement deed in favour of the 2nd plaintiff, on 25.7.1993, on the same day when Arumuga Asari had died.
38. The trial Court had also not accepted the claim of the defendants that the sale deeds executed by the first plaintiff, in favour of the plaintiffs 5 and 6, which had been executed nearly four years after the death of Arumuga Asari are null and void. The trial Court had come to the conclusion that the claim of the defendants that Exhibits A.5, A.6 and A.7 cannot be held to be valid, since, they have been executed by power agent, after the death of Arumuga Asari, the principal of the general power of attorney, marked as Exhibit A.2, dated 24.4.1992, cannot be sustained.
39. The trial Court had also come to the conclusion that there was nothing shown on behalf of the defendants to sustain their claim that the first plaintiff had known about the death of Arumugha Achari, on 25.7.1993. It had also been held that if the first plaintiff had known about the death of Arumuga Asari, he would have created the documents in favour of the plaintiffs 2, 5 and 6 much earlier, instead of executing them, belatedly, as seen from the sale deeds executed in favour of the fifth and sixth plaintiffs.
40. The trial Court had also found that the defendants 1 to 10, who are the legal heirs of Arumuga Asari, ought to have informed about his death to the first plaintiff. However, it had been found that no such information had been passed on to the plaintiffs, by the said defendants. The trial Court had also found, from the evidence adduced on behalf of the defendants, from the admission of D.W.1, during his cross examination, that the defendants 11 to 14 had knowledge about the existence of the sale agreement, dated 17.8.1990, marked as Exhibit A.1, executed by Arumuga Asari in favour of the first plaintiff. In such circumstances, the trial Court had come to the conclusion that the sale deeds in favour of the defendants 11 to 14, bearing document Nos.1366 and 1367 of 1998, are invalid in the eye of law. From the evidence available on record, the trial court had also found that Arumuga Asari, after having received various amounts of money, on different dates, had granted extension of time, for the execution of the sale deeds pursuant to the sale agreement, dated 17.8.1990, marked as Exhibit A.1 Further, it had also been found that after the entire sale consideration of Rs.3,23,000/- had been received by Arumuga Asari, a power of attorney had also been executed in favour of the first plaintiff, on 24.4.1992, marked as Exhibit A.2. A confirmation letter, dated 24.4.1992, marked as exhibit A.3, had been issued by Arumuga Asari and his legal heirs, who are the defendants 1 to 10 in the suit, in favour of the first plaintiff.
41. The trial Court had not accepted the contention raised by the defendants that, once the principal, who had executed a power of attorney, dies, the power agent cannot, thereafter, perform any act, in furtherance of the said power. The trial Court had held that the defendants were not in a position to show sufficient evidence, in order to substantiate their claim that the first plaintiff had knowledge of the death of Arumuga Asari. In such circumstances, the trial Court had held that the documents executed by the first plaintiff, as the power agent of Arumuga Asari, cannot be held to be invalid. Even though it had been claimed, on behalf of the defendants, that the first plaintiff had known about the death of Arumuga Asari, as he had attended the funeral of Arumuga Asari, they had not been in a position to sustain the said claim, by way of acceptable evidence.
42. The trial Court had also held that the 2nd plaintiff trust and the plaintiffs 5 and 6 had taken possession of their respective portions of the suit property, based on the settlement deed and the sale deeds executed by the first plaintiff, based on the power of attorney granted in his favour by Arumuga Asari.
43. The trial Court had granted a decree of permanent injunction, as prayed for by the plaintiffs. The trial Court had also held that, since, the defendants 1 to 10 had created the sale deeds, marked as Exhibits B.18 and B.20, in favour of the defendants 11 to 14, with the knowledge that an agreement for sale of the suit property, marked as Exhibit A.1, had been executed, the sale of the suit property, in favour of defendants 11 to 14, are invalid in the eye of law.
44. The trial Court had further held that there was nothing on record to show that the defendants 1 to 10 had sold the suit property, in favour of the defendants 11 to 14, in good faith and that the defendants 11 to 14 had purchased the same, for valuable consideration, without knowledge of the existence of the agreement for sale, marked as exhibit A.1. In such circumstances, the trial Court had decreed the suit, as prayed for by the plaintiffs in O.S.No.3987 of 2004.
45. Aggrieved by the judgment and decree, dated 30.10.2006, made in O.S.No.3987 of 2004, on the file of the II Additional District Munsif Court, Coimbatore, the defendants 11 to 14 in the suit had filed an appeal, in A.S.No.107 of 2007, on the file of the I Additional Subordinate Court, Coimbatore.
46. The first appellate Court had framed the following points for consideration:
“1. Whether the judgment and decree passed by the trial Court can be held to be correct?
2. whether the appeal is to be allowed?”
47. The first appellate court had found that endorsements had been made in the agreement for sale, marked as Exhibit A.1, by Arumuga Asari, on different dates, after having received various amounts from the first plaintiff. The first appellate court had noted that a general power of attorney, dated 24.4.1992, marked as Exhibit A.2, had been executed by Arumuga Asari in favour of the first plaintiff, giving him various powers to deal with the property in question, including the power to execute the necessary documents, to register the same and to settle and mortgage the said property.
48. It had also been noted, from the evidence of P.W.3, that the entire sale consideration of Rs.3,23,000/, had been received by Arumuga Asari, from the first plaintiff. It had also been noted that P.W.3 had stated, in his evidence, that he had known about the execution of Exhibits A.1 to A.3, and that possession of the property in question had been given to the first plaintiff. Even though the defendants had claimed that Exhibits A.1 to A.3 are created documents, there was nothing to show that such documents are bogus in nature, except the oral statement made on behalf of the defendants, who are the appellants in the first appeal.
49. It had also been found that the appellants had not taken the necessary steps for the scientific examination of the disputed documents. It had also been found that D.W.2, the third appellant in the appeal, had admitted that he knew about the agreement for sale, entered into between Arumuga Asari and the first plaintiff, in the year, 1998. D.W.1 had also admitted that he had knowledge about Exhibit A.1 agreement. Therefore, the first appellate Court had come to the conclusion that Exhibits A.1 to A.3 are true and valid documents. Therefore, according to Exhibit A.2, power of attorney, dated 24.4.1992, Exhibit A.5, settlement deed had been executed in favour of the 2nd plaintiff and Exhibits A.6 and A.7 sale deeds had been validly executed in favour of the plaintiffs 5 and 6, respectively.
50. It had also been noted that Exhibit A.3 confirmation letter had been given by Arumuga Asari and his legal heirs, who were the defendants 1 to 10 in the suit, to confirm Exhibit A.1 sale agreement. It had also been found that D.W.2 had also admitted that the agreement, marked as Exhibit A.1, had not expired, automatically, due to the death of Arumuga Asari. Since, the agreement for sale had been in existence, the power of attorney had not come to an end, automatically.
51. The first appellate Court had also come to the conclusion that the defendants 1 to 10 in the suit ought to have informed the first plaintiff about the death of Arumuga Asari. The failure of the defendants 1 to 10 to do so had been admitted by D.W.1, during the cross examination. The first appellate Court had also held that the documents executed by the first plaintiff, without the knowledge of the death of Arumuga Asari, would be valid, as per Section 208 of the Indian Contract Act, 1872.
52. Further, the first appellate court had found that it had not been shown, on behalf of the appellants, that the suit property had been purchased by them, from the defendants 1 to 10 in the suit, in good faith and for valuable consideration. As such, the first appellate Court had confirmed the findings of the trial Court, by its judgment and decree, dated 31.7.2009, made in A.S.No.107 of 2007.
53. Aggrieved by the judgment and decree of the first appellate Court, dated 31.7.2009, made in A.S.No.107 of 2007, the defendants 11 to 14 in the suit, who were the appellants in the fist appeal, had preferred the present second appeal, before this court, raising the following questions, as substantial questions of law:
“i. Are the Courts below right in decreeing the suit without deciding whether the suit for declaration and injunction is maintainable without seeking a relief of specific performance?
ii. In the absence of a registered instrument, whether the plaintiff can plead that he has power coupled with interest?
iii. Whether the alleged settlement deed is valid in law when no right flows to the power of attorney to execute a settlement deed?
iv. When the Courts have well admitted the possession of the defendants by relying on various documents, still are the Courts below right in decreeing the suit for permanent injunction?”
54. The learned senior counsel appearing for the appellants had submitted that the judgment and decree of the Courts below are erroneous, contrary to law and the facts and circumstances of the case. The first appellate court had failed to adhere to the mandatory laid down under Order 41 of the Civil Procedure Code. The Courts below had failed to see that the suit for declaration had been laid by the respondents, based on an unregistered agreement of sale.
55. It had been further submitted that the suit filed by the plaintiffs, praying for the reliefs of declaration and for permanent injunction, cannot be maintained, as the suit should have been filed only for the relief of specific performance of the alleged agreement, dated 17.8.1990, marked as Exhibit A.1.
56. It had been further submitted that the Courts below ought to have seen that, neither the agreement for sale, nor the confirmation letter is a registered document. As such, the said unregistered document cannot be relied upon to decide the title of the respondents in the present second appeal, who are the plaintiffs in the suit, in O.S.No.3987 of 2004. The Courts below had failed to note that the defendants 1 to 10 in the suit, who are the legal heirs of the deceased Arumuga Asari, had categorically pleaded that no agreement of sale had been entered into between Arumuga Asari and the first plaintiff and that, neither the power of attorney, nor the confirmation letter had been executed in favour of the first plaintiff and that the said documents are forged, as asserted by D.W.1 in his evidence.
57. It had also been submitted that the sale agreement suffers from various infirmities relating to its signing, attestation etc., which are vital in nature. The Courts below ought to have noticed that the plaintiffs in the suit had omitted to mention the fact about the death of Arumuga Asari, on 25.7.1993, and that the power of attorney is not coupled with interest.
58. It had also been submitted that the Courts below ought to have held that, after the death of Arumuga Asari, on 25.7.1993, the general power of attorney, said to have been executed in favour of the first plaintiff, by Arumuga Asari, would have become invalid in the eye of law. The Courts below had failed to appreciate the evidence available on record in favour of the appellants.
59. The learned senior counsel had also submitted that when the plaintiffs 2, 5 and 6 claim that they have title in respect of the suit property, under Exhibits A.4, A.5 and A.7, it is for them to prove, by sufficient evidence, that such documents were valid in the eye of law. Since, it is clear that Exhibits A.1, A.2 and A.3 are forged and concocted documents, the documents marked as Exhibits A.4, A.5 and A.7, said to have been executed by the first plaintiff, cannot be held to be valid. It is obvious, on the face of the record, that the signatures of Arumuga Asari, both in the Exhibit A.1, sale agreement, dated 17.8.1990 and Exhibit A.2, power of attorney, dated 24.4.1992, varies from page to page. In some pages of the said document, no proper endorsements had been made and in some other pages the attestations are improper. However, in all the endorsements the attestors are the same. The signature of Pankajam also differs from page to page. Various other irregularities are also found in the documents, marked as Exhibits A.1 and A.2. Further, there is no reason for the execution of Exhibit A.3, said to be a confirmation letter, signed by the defendants 1 to 10, who are the legal heirs of the deceased Arumuga Asari.
60. The learned senior counsel had also submitted that no proper reasons had been given on behalf of the plaintiffs as to why there was a need for a confirmation letter in favour of the first plaintiff, marked as Exhibit A.3. Such irregularities cast a serious doubt as to whether Arumuga Asari had signed the documents, marked as Exhibits A.1 and A.2. No proper reasons had been given as to why a general power of attorney had been given by Arumuga Asari, in favour of the plaintiffs, after nearly two years from the date of the execution of the alleged agreement for sale marked as Exhibit A.1. If all payments had been made by 24.4.1992, as claimed on behalf of the plaintiffs, there is no reason why a power of attorney had to be executed, instead of a sale deed.
61. The learned senior counsel had also submitted there is no necessity for the power of attorney to deal with the settlement, mortgage etc. Further, there is no proper reason stated by the plaintiffs for the confirmation letter being executed on the same day when Exhibit A.2, the power of attorney, dated 24.4.1992, had been executed.
62. The learned senior counsel had also submitted that it is a settled position in law that, except in certain circumstances, the power of attorney granted in favour of an agent would come to an end on the death of the Principal. Further, it is unusual to note that a gift settlement had been executed, on 25.7.1993, in favour of the 2nd plaintiff on the same day when Arumuga Asari is said to have died. Further, on 13.5.1997, the first plaintiff is said to have executed two sale deeds, marked as Exhibits A.6 and A.7, in favour of the plaintiffs 5 and 6, respectively. The sale deeds had been registered thereafter, on 15.9.1993, more than two months after the death of Arumuga Asari. The said sale deeds had been executed nearly four years after the death of Arumuga Asari.
63. It has been further stated that there are discrepancies in the date and the name on which the stamp paper had been purchased in the year, 1992. In the power of attorney, said to have been executed by Arumuga Asari, in favour of the first plaintiff, there is no indication that the power was coupled with interest and as such, the said power could be taken to be irrevocable in nature. Both the Courts below had wrongly held that the power was coupled with interest. In such circumstances, the power of attorney, said to have been executed in favour of the first plaintiff would, automatically, cease to be in force. In such circumstances, both the trial Court, as well as the first appellate Court had erred in coming to the conclusion that the defendants in the suit, who are the appellants in the present second appeal, ought to have taken steps to obtain expert opinion, with regard to the disputed documents. In such circumstances, the judgment and decree of the Courts below are erroneous and invalid and liable to be set aside.
64. Per contra, the learned counsel appearing for the respondents had submitted that the judgment and decree of the Courts below cannot be said to be contrary to law and the evidence available on record. The courts below had rightly come to their conclusions on appreciation of the evidence adduced on behalf of the parties concerned, both oral, as well as the documentary. He had submitted that Arumuga Asari had executed an agreement for sale in favour of the first plaintiff, on 17.8.1990, marked as Exhibit A.1. Thereafter, he had also given a power of attorney in favour of the first plaintiff to deal with the property in question, marked as Exhibit A.2. The defendants 1 to 10, who are the legal heirs of Arumuga Asari, had also signed in the confirmation letter authorising the first plaintiff to deal with the property. Therefore, the gift settlement in favour of the second respondent, marked as Exhibit A.5 and the sale deeds bearing document No.1366/98 and 1367/98, marked as exhibits A.6 and A.7, in favour of the defendants 5 and 6, are valid in law. In such circumstances, the sale of the suit property, by the defendants 1 to 10, in favour of the defendants 11 to 14, cannot be held to be valid in the eye of law.
65. The learned senior counsel appearing for the appellant had relied on the following decisions in support of his contentions that the power of attorney executed by Arumugha Achari, in favour of the first plaintiff, marked as Exhibit A.2, cannot be held to be of an irrevocable nature.
65.1. In SETH LOON KARAN Vs. I.E. JOHN (AIR 1969 SC 73), the Supreme Court had held as follows:
4. In this appeal we had the benefit of hearing the elaborate arguments of Shri M.C. Chagla for the appellant and of Shri C.B. Agarwala for the respondent. From the arguments advanced the following questions arise for consideration:
(1) Whether the power of attorney in question is a power coupled with interest; if it is so, whether the same is revocable.
(2) Whether in view of the said power the Bank can be held to be an assignee of the interest in the decree; if so, whether that assignment is a legal assignment or an equitable assignment?
(3) Whether the dispute between the appellant and the Bank could have been enquired under Section 47 of the Code of Civil Procedure?
(4) If it is held that the Bank is an assignee of the amount due under the decree or any portion thereof, can it because of that interest execute the decree, despite the objection of the appellant, either under Order XXI, Rule 16 or under Section 146 of the Code of Civil Procedure? and
(5) The execution application having been filed in the name of the appellant, can the Bank now be permitted to continue the execution in its own right?
Some of the questions presented for decision are not free from difficulty. But it is not necessary for us to pronounce on those questions as we are of the opinion that the power of attorney in question is a power coupled with interest, and hence the same is not revocable. Further, the transaction entered into under that document amounts to an equitable assignment of the decree in favour of the Bank to the extent necessary to discharge appellants debts to the Bank and on the basis of the rule laid down by this Court in Jugulkishore Saraf v. Raw Cotton Co. Limited (1955) 1 SCR 1369 = (AIR 1955 SC 376), it is open to the Bank to execute the decree in its own right. Lastly, we attach no importance to the form of the execution, which form was necessitated because of the terms of the power of attorney, looking to the substance of the matter and not being unduly weighed down by the form, we are of opinion that the Bank has been executing the decree in its own right. We shall elaborate our reasons in support of these conclusions presently. In view of our above conclusion we have not thought it necessary to go into the other questions of law raised at the hearing.
5. There is hardly any doubt that the power given by the appellant in favour of the Bank is a power coupled with interest. That is clear both from the tenor of the document as well as from its terms. Section 202 of the Contract Act provides that where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest. It is settled law that where the agency is created for valuable consideration and authority is given to effectuate a security or to secure interest of the agent, the authority cannot be revoked. The document itself says that the power given to the Bank is irrevocable. It must be said in fairness to Shri Chagla that he did not contest the finding of the High Court that the power in question, was irrevocable.”
65.2. In SUBBA RAW Vs. VARADAIAH (AIR (30) 1943 MADRAS 482), this Court had held as follows:
“………… These provisions make it plain that on the sale of property subject to incumbrances, the bargain relates to the vendor’s interest in the property such as it is, that is to say, his equity of redemption and the discharge fof the incumbrances is the sole concern of the purchaser as between himself and the vendor who is only entitled to be indemnified against the incumbrances; while in the case of a sale free from incumbrances, the price is fixed with reference to the full value of the property, the liability to discharge all the incumbrances being thrown on the vendor, the vendee, however, being given the right to retain out of the price an amount sufficient to clear the incumbrances. But as the liability to pay them off is that of the vendor who has to implement his sale by providing a clear title, the vendee must be regarded as paying the amount retained to the incumbrancer on behalf of the vendor out of the purchase-money payable to the latter under the contract of sale. In other words, the vendee acts as the agent of the vendor as regards the disposal of the sum retained, although the agency is one which cannot be revoked as the vendee has himself an interest in the money being applied in the manner indicated.”
65.3. In PALANI VANNAN Vs. KRISHNASWAMI KONAR (AIR (33) 1946 MADRAS 9), this Court had held that the primary object of a power-of-attorney for executing a decree was to recover on behalf of the principal the fruits of his decree. It contained incidentally a provision for the employment of the agent, V, in order to realise that decree. It provided that his remuneration was to be one-half of the proceeds. It contained an indemnity clause against any out-of-pocket expenses which V was entitled also to recover from the amount of the decree. But the object of the power-of-attorney was not for the purpose of protecting or securing any interest of the agent V. The last words of the power were “I shall not for any reason whatsoever, cancel without your permission this authority which I have given to you, without paying the amount expended by you and without giving the aforesaid relief for your trouble.
65.4. In PRAHLAD PD. Vs. T.F.KUMARI (1956 PATNA 233 (AIR V 43 C 60 JULY), it has been held as follows:
“12. Applying the principles that emerge from these authorities to the facts stated in the documents, referred to above, I hold that the contention of Mr.Das as to the nature of right that gave rise to the possession in favour of S.K.Chatterjee over Basauri Mahal is well founded and further I think that he is also right in his submission that that that right accrued to his client for the first time on the very date when the second document dated 14.5.1952 was executed.
All the elements that are necessary in law to constitute an agency of an irrevocable character are present in that document even though that was not described as such. Its contents clearly show, as rightly argued by Mr.P.R.Das, that Tikaitni Faldani Kumari under that document agreed that the debts raised by S.K.Chatterjee for her were to be realised out of the collections to be made by him from Basauri Mahal. That, in substance, amounted to an allocation of the funds to be appropriated towards the repayment of the debts.
Therefore, on the very day when that document was executed, the agency coupled with interest came into existence and that being so it cannot be said that the right on the basis of which S.K.Chatterjee claims possession was created in his favour at a time subsequent to the notification published on 29.5.1952. Such, therefore, being the position of S.K.Chatterjee over Basauri Mahal, the final question that has next to be answered is as to whether the court or the receiver appointed in the suit is justified in law to dispossess him from that.”
65.5. In M.JOHN KOTAIAH Vs. A.DIVAKAR (AIR 1985 ANDHRA PRADESH 30), it has been held as follows:
“13. It will therefore be seen that in cases where the principal owed some money to the agent and for the purpose of discharge of that amount conferred a right on the agent to recover a debt payable to the principal by a third party and assigned the right to collect such debt from the third party to the agent, the agent acquires an interest in the debt so assigned and the power granted to the agent is to be irrevocable. Similarly in cases where the principal becomes liable to a third party and has also to get some monies from his debtors or others owing money to him he can appoint an agent for remuneration and direct him to collect the monies due to him and pay to his creditors. In such a contingency the agent becomes an agent not only for the principal but also for the third party who has to get monies from the principal. The agent acquires a right in respect of the monies due to the principal from his debtors or others and thereby the power becomes an irrevocable power of attorney. These contingencies are clearly explained in the decision of the Delhi High Court in Harbans Singh’s case (ILR (1977) 2 Delhi 649). It was pointed out in that case that the interest created under an irrevocable power of attorney does not necessarily amount to an interest in the property which is the subject matter of the power of attorney. Unless the document itself created a right in immovable property thereby attracting Section 17 of the Registration Act there is no question of the power of attorney becoming compulsorily registrable. But at the same time it may still create an interest sufficient to make the power of attorney irrevocable for purposes of Section 202 of the Contract Act.
17. Thus it will be seen that if the interest created in the agent is in the result or the proceeds arising after the exercise of the power then the agency is revocable and cannot be said to be an irrevocable agency. However, if the interest in the subject matter, say a debt payable to the principal, is assigned to the agent as security simultaneously with the creation of the power and thereafter the agent exercises the power to collect the debt for discharge of an obligation owed by the principal in favour of the agent or owed by the principal in favour of a third party then the agency becomes irrevocable.”
66. The learned senior counsel for the appellants had submitted that it is for the plaintiff to prove their claims, especially, when they are based on an unregistered document, such as the power of attorney, and when the claims are seriously disputed by the defendants. In support of the said contention, he had relied on the decision of the Supreme Court, reported in THIRUVENGADAM PILLAI Vs. NAVANEETHAMMAL ((2008) 4 SCC 530), wherein, it had been held as follows:
“19. The trial court had analysed the evidence properly and had dismissed the suit by giving cogent reasons. The first appellate court reversed it by wrongly placing onus on the defendants. Its observation that when the execution of an unregistered document put forth by the plaintiff was denied by the defendants, it was for the defendants to establish that the document was forged or concocted, is not sound proposition. The first appellate court proceeded on the basis that it is for the party who asserts something to prove that thing; and as the defendants alleged that the agreement was forged, it was for them to prove it. But the first appellate court lost sight of the fact that the party who propounds the document will have to prove it. In this case the plaintiff came to court alleging that the first defendant had executed an agreement of sale in his favour. The first defendant having denied it, the burden was on the plaintiff to prove that the first defendant had executed the agreement and not on the first defendant to prove the negative. The issues also placed the burden on the plaintiff to prove the document to be true. No doubt, the plaintiff attempted to discharge his burden by examining himself as also scribe and one of the attesting witnesses. But the various circumstances enumerated by the trial court and the High Court referred to earlier, when taken together, rightly create a doubt about the genuineness of the agreement and dislodge the effect of the evidence of PWs 1 to 3. We are therefore of the view that the decision of the High Court, reversing the decision of the first appellate court, does not call for interference.”
67. In view of the submissions made by the learned counsels appearing on behalf of the appellants, as well as the respondents and in view of the evidence available on record, and the decisions cited, this Court is of the considered view that the appellants had not shown sufficient cause or reason to set aside the judgment and decree of the Courts below. Both the courts below have rightly held that the respondents are entitled to the suit properties, as claimed in the suit, in O.S.No.3987 of 2004. From the evidence available on record, it is clear that Arumugha Asari had executed a power of attorney, dated 24.4.1992, marked as Exhibit A.2, in favour of the first plaintiff in the suit, in O.S.No. 3987 of 2004, who is the first respondent in the present second appeal.
68. It is also seen that, on 24.4.1992, Arumugha Asari and his sons and daughters, who were the defendants 1 to 10 in the suit, had executed a confirmation letter, marked as Exhibit A.3, confirming the agreement for sale executed by Arumugha Asari, in favour of first plaintiff, on 17.8.1990, in respect of the agricultural land, with an extent of 6.46 acres. The possession of the lands in question had also been handed over to the first plaintiff, pursuant to the agreement for sale. The original title deed, dated 11.4.1960, and the other related documents, such as the patta, pass book, kists receipts, chitta, and the adangal, had also been handed over to the first plaintiff.
69. It is also noted that the first plaintiff, as the power of attorney of Arumugha Asari, had executed a registered settlement deed, in respect of five acres of the land in question, in favour of the second plaintiff trust, marked as Exhibit A.5. While so, the defendants 1 to 10 had executed certain sale deeds, relating to the suit properties, in favour of the defendants 11 to 14. While, sufficient evidence had been adduced on behalf of the plaintiffs in the suit, to substantiate the factual aspects narrated above, there is nothing available on record to show that the defendants 11 to 14 are bona fide purchasers of the properties in question, for valid consideration. Therefore, the defendants 11 to 14 could not have derived any valid right or title, in respect of the suit properties in question.
70. It had been contended, on behalf of the defendants, that the sale deeds, dated 13.5.1997, executed by the first plaintiff, in favour of the plaintiffs 5 and 6, marked as Exhibits A.6 and A.7, respectively, and the settlement deed, dated 25.7.1993, marked as Exhibit A.5, executed by the first plaintiff, in favour of the second plaintiff trust, cannot be held to be valid, in view of the fact that they had been executed by the first plaintiff, who was the power of attorney agent, after the death of Arumugha Asari, the principal, on 25.7.1993. However, the defendants had not been in a position to prove, by sufficient evidence, that the first plaintiff was aware of the death of Arumugha Asari, when he had executed the said sale deeds and the settlement deed. Further, there is no proper explanation from the side of the defendants as to how the original title deeds and the other relevant documents, relating to the suit properties, were in the custody of the first plaintiff.
71. Further, Arumugha Asari had executed the sale deeds, dated 13.5.1997, in favour of the plaintiffs 5 and 6, marked as Exhibits A.6 and A.7, respectively, after having received the entire sale consideration of Rs.3,23,000/-.
72. It is also seen, from the evidence of D.W.1, that the defendants 11 to 14 had knowledge about the existence of the sale agreement, dated 17.8.1990, marked as Exhibit A.1, executed by Arumugha Asari in favour of the first plaintiff. In such circumstances, both the Courts below had come to the conclusion that the documents executed by the first plaintiff, without the knowledge of the death of Arumugha Asari, would be valid, as per Section 208 of the Indian Contract Act, 1872. As such, the contentions raised on behalf of the appellant cannot be countenanced. Since, the present second appeal filed by the appellants is devoid of merits, it is liable to be dismissed. Hence, it stands dismissed. No costs. Consequently, connected M.P.No.1 of 2009 is closed.
lan
To:
1. The 1st Additional Subordinate Court,
Coimbatore
2. The II Additional District Munsif Court,
Coimbatore