Title Cannot Be Transferred On The Basis Of Agreement To Sell/General Power Of Attorney: SC Rejects Contention That 'Suraj Lamps' Judgment Is Only Prospective

Read Judgment

The Supreme Court has reiterated that a title with respect to an immovable property cannot be transferred based on an Agreement to Sell or a General Power of Attorney.

It rejected the contention that the judgment in the case of Suraj Lamps and Industries Pvt. Ltd. v. State of Haryana and Anr. 183 (2011) DLT 1 (SC) is only prospective.

The Court was deciding an appeal against the judgment of the Delhi High Court which had affirmed a Trial Court’s judgment of decreeing the suit for possession and mesne profits.

The two-judge Bench of Justice Vikram Nath and Justice Rajesh Bindal held, “Having considered the submissions at the outset, it is to be emphasized that irrespective of what was decided in the case of Suraj Lamps and Industries(supra) the fact remains that no title could be transferred with respect to immovable properties on the basis of an unregistered Agreement to Sell or on the basis of an unregistered General Power of Attorney. … The argument advanced on behalf of the respondent that the judgment in Suraj Lamps & Industries (supra) would be prospective is also misplaced.”

The Bench said that the Registration Act, 1908 clearly provides that a document which requires compulsory registration under the Act, would not confer any right, much less a legally enforceable right to approach a Court of Law on its basis.

In this case, the appellant was a defendant in the suit for possession and mesne profits instituted by the respondent with respect to the property in question. The suit was filed based on a Power of Attorney, an agreement to sell, an affidavit, and a will executed in favour of the respondent. The appellant, admittedly, was in possession of the property in question and the suit was contested on several grounds that the appellant was the owner of the property having received the same based on a Hiba (oral gift) from its owner, his own brother. Secondly, the suit was not maintainable as none of the documents based on which the suit was filed were neither admissible nor enforceable under the law.

The findings recorded by the Trial Court were that all the issues were decided against the appellant and in favour of the respondent except issue no. 8 and decree for possession along with mesne profits was granted. In a regular appeal filed under Section 96 of the Code of Civil Procedure, 1908 (CPC) the High Court confirmed the finding with regard to the claim of the appellant regarding Hiba in his favour and held that the appellant had failed to prove the same. With respect to the other argument regarding the suit being maintained based on an unregistered document, the High Court, although in principle agreed but proceeded to uphold the decree of possession on the ground that the respondent had filed the suit as an Attorney for and on behalf of its owner and that he was not objecting to the respondent seeking possession of the suit property. On this sole ground, it confirmed the decree of possession and dismissed the appeal.

The Supreme Court in the above regard observed, “Even if these documents i.e. the Agreement to Sell and the Power of Attorney were registered, still it could not be said that the respondent would have acquired title over the property in question. At best, on the basis of the registered agreement to sell, he could have claimed relief of specific performance in appropriate proceedings. In this regard, reference may be made to sections 17 and 49 of the Registration Act and section 54 of the Transfer of Property Act, 1882.”

The Court further noted that the law is well settled that no right, title, or interest in immovable property can be conferred without a registered document. It also said that the embargo put on registration of documents would not override the statutory provision to confer title based on the unregistered documents with respect to immovable property.

“Once this is the settled position, the respondent could not have maintained the suit for possession and mesne profits against the appellant, who was admittedly in possession of the property in question whether as an owner or a licensee. … The requirement of compulsory registration and its effect on non-registration emanates from the statutes, in particular the Registration Act and the Transfer of Property Act. The ratio in Suraj Lamps & Industries (supra) only approves the provisions in the two enactments. Earlier judgments of this Court have taken the same view”, said the Court.

The Court concluded that in case the respondent wanted to evict the appellant treating him to be a licensee, he could have maintained a suit on behalf of the true owner or the landlord under specific instructions of Power of Attorney as landlord claiming to have been receiving rent from the appellant or as Attorney of the true owner to institute the suit on his behalf for eviction and possession.

Accordingly, the Apex Court allowed the appeal, set aside the impugned judgment, and dismissed the suit.

Title Of Immovable Property Can't Be Transferred Through Sale Agreement Or General Power Of Attorney : Supreme Court

The Supreme Court recently held that no title could be transferred concerning immovable properties on the basis of an Agreement to Sell or based on
a General Power of Attorney. 

A bench of Justice Vikram Nath and Justice Rajesh Bindal observed as thus: 

“...no title could be transferred with respect to immovable properties on the basis of an unregistered Agreement to Sell or on the basis of an unregistered General Power of Attorney. The Registration Act, 1908 clearly provides that a document which requires compulsory registration under the Act, would not confer any right, much less a legally enforceable right to approach a Court of Law on its basis. Even if these documents i.e. the Agreement to Sell and the Power of Attorney were registered, still it could not be said that the respondent would have acquired title over the property in question. At best, on the basis of the registered agreement to sell, he could have claimed relief of specific performance in appropriate proceedings. In this regard, reference may be made to sections 17 and 49 of the Registration Act and section 54 of the Transfer of Property Act, 1882”

The bench also rejected the argument that the 2011 judgment in Suraj Lamps & Industries Pvt. Ltd. Vs. State of Haryana and Anr- which held that title cannot be transferred through unregistered documents- applies only prospectively.

"Law is well settled that no right, title or interest in immovable property can be conferred without a registered document," the Court observed referring to sections 17 and 49 of the Registration Act and section 54 of the Transfer of Property Act, 1882. 

"The argument advanced on behalf of the respondent that the judgment in Suraj Lamps & Industries (supra) would be prospective is also misplaced. The requirement of compulsory registration and effect on non-registration emanates from the statutes, in particular the Registration Act and the Transfer of Property Act. The ratio in Suraj Lamps & Industries (supra) only approves the provisions in the two enactments."

The appellant in this case was the defendant in a suit instituted by the respondent filed for possession and mesne profits with respect to a certain property. The suit was filed on the basis of a Power of Attorney, an agreement to sell, an affidavit and a will executed in favour of the respondent. 

The appellant was in possession of the property in question. The suit was contested citing that the appellant was the owner of the property since he received it as a gift from his brother, Laiq Ahmed. The appellant also contended that the suit was not maintainable since the documents on the basis of which the suit was filed were neither admissible nor enforceable under law.

The suit was decreed for possession and mesne profits in favour of the respondent. The appellant then approached the High Court, but his appeal was dismissed. 

Although the High Court in principle agreed to the argument regarding the unregistered document, it upheld the the decree of possession on the ground that the respondent had filed the suit as an Attorney for and on behalf of its owner Laiq Ahmed (brother of the appellant) and that Laiq Ahmed did not object to the respondent seeking possession of the suit property. On this ground alone, the High Court confirmed the decree of possession and dismissed the appeal. 

Subsequently, the appellant approached the Supreme Court. 

The Appellant argued that the Trial Court erred in decreeing the suit for possession and mesne profits on the basis of unregistered documents such as the Agreement to Sell, Power of Attorney, Affidavit and a Will. 

Law is well settled that no right, title or interest in immovable property can be conferred without a registered document, the Apex Court said. 

“The embargo put on registration of documents would not override the statutory provision so as to confer title on the basis of unregistered documents with respect to immovable property. Once this is the settled position, the respondent could not have maintained the suit for possession and mesne profits against the appellant, who was admittedly in possession of the property in question whether as an owner or a licensee” the Apex Court observed. 

In this regard, the Court placed reliance on the recent judgments in Ameer Minhaj Vs. Deirdre Elizabeth (Wright) Issar 2018) 7 SCC 639, Balram Singh Vs. Kelo Devi Civil Appeal No. 6733 of 2022 and M/S Paul Rubber Industries Private Limited Vs. Amit Chand Mitra in SLP (C) No. 15774 of 2022. 

The Apex Court did not agree with the view taken by the High Court and allowed the appeal while dismissing the suit. 

“In case the respondent wanted to evict the appellant treating him to be a licensee, he could have maintained a suit on behalf of the true owner or the landlord under specific instructions of Power of Attorney as landlord claiming to have been receiving rent from the appellant or as Attorney of the true owner to institute the suit on his behalf for eviction and possession. That being not the contents of the plaint, we are unable to agree with the reasoning given by the High Court in the impugned order” the Apex Court concluded.

High Courts, Session Courts Can Grant Interim/Transit Anticipatory Bail Even When FIR Is Registered In Another State: Supreme Court

Read Judgment

The Supreme Court Observed:

"...we hold that the Court of Session or the High Court, as the case may be, can exercise jurisdiction and entertain a plea for limited anticipatory bail even if the FIR has not been filed within its territorial jurisdiction and depending upon the facts and circumstances of the case, if the accused apprehending arrest makes out a case for grant of anticipatory bail but having regard to the fact that the FIR has not been registered within the territorial jurisdiction of the High Court or Court of Session, as the case may, at the least consider the case of the accused for grant of transit anticipatory bail which is an interim protection of limited duration till such accused approaches the competent Sessions Court or the High Court, as the case may be, for seeking full-fledged anticipatory bail".

Two issues had arisen before the court-

• Whether the power of the HC/Sessions to grant anticipatory under Section 438 of CrPC could be exercised with respect to an FIR registered outside the territorial jurisdiction of the said court?
• Whether the practice of granting transit anticipatory bail or interim protection to enable an applicant seeking anticipatory bail to make an application under section 438 CrPC before a court of competent jurisdiction is consistent with the administration of criminal justice?

The Court began by going to the legal framework, judgments of HC, the evolution of safeguard of anticipatory bail. It quoted Gurbaksh Singh Sibbia v. State of Punjab, a Constitutional bench judgment where the Supreme Court speaking through CJI YV Chandrachud observed “ The society has a vital stake in preserving personal liberty as well as investigational powers of police and their their relative importance at any given time depends upon the complexion and restraints of political conditions. How best to balance these interests while determining the scope of Section 438 of the Code of Criminal Procedure, 1973 was the focus of the said case.”

Then, the court placed the question in the context of personal liberty and access to justice. It held that “we must also look at same from angle of personal liberty and access to justice. Art. 39A deals with- equal justice and free legal aid which can be considered to be a specie of Art 21 which deals with right to life and liberty.”

Delhi High Court Restrains Kerala Based Furniture Store From Using ‘IKEA’ Mark In Trademark Infringement Suit

Read Judgment

The Delhi High Court has restrained a Kerala-based furniture store “Ikea Luxury Furniture” from using the mark “Ikea” either as a trademark or trade name on hoardings, including stationery, banners, handbills, and promotional materials.  Justice Prathiba M Singh was dealing with a trademark infringement suit filed by multinational furniture company, Inter IKEA Systems BV. It sought the protection of its mark ‘IKEA’.

Ikea alleged that the defendant's furniture store was using the mark ‘IKEA’ in respect of various furniture items as also on inside hoardings in the shop and boxes of the products.  “It is clear from the reading of pleadings and documents that the mark.

Considering that the defendant was using the mark for identical goods and products range and targeted the same consumer segment, the court observed that it is a fit case for the grant of an ex-parte ad-interim injunction in favour of Ikea.  “Despite the legal notice being communicated, the Defendant has failed to stop the use of the mark ‘IKEA’. Accordingly, the Defendant shall stand restrained from using the mark.

Justice Singh added that Ikea is free to write to JustDial to take down the page of the Defendant with the name ‘IKEA Luxury Furniture’.