Ownership cannot be conferred on the basis of an Agreement to sell, expounds HC
The Delhi High Court has opined that a General Power of Attorney which is undated, unsigned, and lacks material substance is non-est and that solely based on it no right, title or interest can be claimed in a property. It was held that no ownership can be conferred based on an Agreement to Sell, at best it can be used to get the sale deed executed. The High Court further noted that the transfer of immovable property can only be done through a registered sale deed.
Brief Facts:
The suit was instituted by one Ram Sharma (son of the Applicant) against the husband of the Applicant, son of the Applicant, and daughter of the Applicant claiming partition of the Scheduled Properties. It was claimed that the parties constitute the Undivided Hindu Joint Family and their common ancestor Late Shri Devki Nandan Sharma partitioned the Ancestral property during his life amongst his sons.
Thereafter, the matter was referred to mediation and the parties to the suit reach an amicable settlement.
As per the settlement, the Suit property was to be divided equally between the children of the Applicant after the demise of the husband of the Applicant.
Now, the Applicant (mother of Plaintiff and Defendant No. 2 and 3) via the present application demands setting aside the settlement agreement on the grounds of fraud and collusion between the parties.
Contentions of the Applicant:
The suit property was alleged to be a jointly owned property of Defendant No. 1 and the Applicant which devolved on Defendant No. 1 by way of intestate succession after the demise of the father of Defendant No. 1. It was claimed that out of 268 square yards, 168 square yards was transferred by Defendant No.1 to the Applicant and to prove the same transfer documents such as Agreement to Sell, Power of Attorney, Will, etc. have been annexed. It was argued that the decree has been obtained by collusion and without informing the Application who is the co-owner of the suit property.
Observations of the Court:
The Court looked at Order XXIII of the Code of Civil Procedure, 1908 (hereinafter referred to as “CPC”) and noted that Rules 1 and 3 of Order XXIII are distinct as the former is a unilateral action and the latter is a bilateral action to compromise and settle the suit. Rule 3A of Order XXIII specifically bars the institution of a fresh suit to challenge the judgment on the ground that the settlement or compromise decree was illegal.
The Bench remarked that the object of the Legislature is to bring an end to the Litigation as can be manifested in Section 96(3) of CPC. According to this section, there can be no appeal from a decree that has been passed with the consent of the parties.
It was opined that the compromise decree is akin to a decree passed after adjudication by the Court and that the compromise decree is not just a contract between the parties. It is a hybrid creature comprising both command and contract execution.
In the present case, the High Court observed that the Applicant has only annexed a copy of the General Power of Attorney to support her contention. Further, the copy is undated, unsigned, and lacks material substance making it non-est. It was opined by the Court that solely based on General Power of Attorney, no right, title, or interest can be created in the suit property.
It was further noted by the Court that the application is filed in 2022 while the judgment was passed in 2011 and there was no reply concerning the delay.
It was observed that the Applicant was seeking the right only on basis of an Agreement to Sell which is not even existing as it has not been placed on record. It was propounded by the Delhi High Court that an Agreement to Sell does not confer any ownership and that transfer of immovable property only happens via a registered sale deed. Had there been an Agreement to sell, the only recourse to the Applicant would have been to get the execution of the sale deed.
The decision of the Court:
Therefore, holding that on basis of undated, unregistered GPA the Applicant has no right whatsoever, the Delhi High Court dismissed the Application.
Case Title: Ram Sharma v. Ashok Kumar Sharma & Ors.
Coram: Hon’ble Ms. Justice Neena Bansal Krishna
Case No.: CS (OS) 2183/2010
Advocates for Plaintiff: None
Advocates for Defendants: Advs. Mr. Ranjeet Kumar, Asha Sharma
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