The Supreme Court of India has reaffirmed that a General Power of Attorney (GPA) terminates upon the death of the principal and that an unregistered sale agreement does not confer ownership rights in immovable property. The ruling was delivered in the case of M. S. Ananthamurthy & Anr. vs J. Manjula Etc. [SLP (C) Nos. 13618-13619 of 2020], where the court upheld the legal requirement of a registered conveyance deed for valid property transfers.
The judgment was delivered by a bench comprising Justice J.B. Pardiwala and Justice R. Mahadevan. The court meticulously analyzed the legal validity of transactions executed under a GPA and the consequences of an unregistered sale agreement.
Background of the Case
The dispute arose over a plot of land in Chunchaghatta Village, Bangalore, originally owned by Muniyappa @ Ruttappa. The appellants, M. S. Ananthamurthy and another, claimed ownership based on a GPA and an unregistered Agreement to Sell executed in 1986. However, the respondent, J. Manjula, argued that she lawfully acquired the property through a series of registered transactions—beginning with a sale deed on March 21, 2003, followed by another sale deed on September 29, 2003, and a gift deed dated December 6, 2004.
Legal proceedings began when the appellants sought to challenge the ownership of the respondent. The trial court ruled in favor of the respondent, granting a permanent injunction against the appellants. The Karnataka High Court upheld this decision, prompting the appellants to move the Supreme Court.
Key Legal Issues
The Supreme Court examined the following legal questions:
Does a General Power of Attorney (GPA) confer ownership rights upon the holder?
What is the legal effect of an unregistered Agreement to Sell?
Can a GPA holder execute a sale deed after the death of the principal?
Whether a suit for permanent injunction is maintainable without a declaratory relief regarding title?
Supreme Court’s Observations and Ruling
The Supreme Court reaffirmed the legal principles established in Suraj Lamp & Industries Pvt. Ltd. v. State of Haryana [(2012) 1 SCC 656], stating:
“A General Power of Attorney is fundamentally an instrument of agency and ceases to exist upon the death of the principal. Transactions based on such an instrument after the principal’s death are legally void.”
Regarding the unregistered Agreement to Sell, the court emphasized:
“An unregistered sale agreement does not convey ownership. Under the Transfer of Property Act, 1882, and the Registration Act, 1908, a registered conveyance deed is mandatory for the legal transfer of ownership rights.”
The court further held:
“An agent or power of attorney holder derives authority strictly from the instrument of agency. Once the principal dies, the agent’s authority ends unless it is explicitly coupled with an interest that survives beyond the principal’s lifetime.”
On the issue of limitation, the bench stated:
“A claim to ownership of immovable property must be pursued within the statutorily prescribed period. The appellants failed to act within the legal timeframe, rendering their claim unsustainable.”
Final Decision of the Court
After careful deliberation, the Supreme Court dismissed the appeals and upheld the Karnataka High Court’s ruling. The key takeaways from the judgment are:
The GPA in favor of the appellants ceased to exist upon the original owner’s death in 1997, making any transaction under it invalid.
The Agreement to Sell was unregistered and thus incapable of transferring ownership rights.
The respondent’s registered sale deeds and gift deed were valid, establishing her lawful ownership of the suit property.
The appellants’ challenge to ownership was barred by limitation, as they failed to take legal action within the prescribed three-year period under the Limitation Act, 1963.
