HON’BLE SRI JUSTICE ASHUTOSH MOHUNTA AND HON’BLE SRI JUSTICE M. SATYANARAYANA MURTHY CIVIL MISCELLANEOUS APPEAL No.239 OF 2013
Date: 24-01-2014
Between:
Mr. Bobba Prasad. - - - Appellant.
And M/s. Aashi Realtors, A Registered Partnership Firm, I Floor 125, M.G. Road, Secunderabad, Rep. by its Managing Partner Mr. Sukesh Gupta and 3 others. - - - Respondents.
This Court made the following :
HON’BLE SRI JUSTICE ASHUTOSH MOHUNTA AND HON’BLE SRI JUSTICE M. SATYANARAYANA MURTHY CIVIL MISCELLANEOUS APPEAL No.239 OF 2013
JUDGMENT: (Per Hon’ble Sri Justice M. Satyanarayana Murthy)
Aggrieved by the order and decretal order dated 12.10.2012, passed in I.A. No.401 of 2012 in O.S. No.96 of 2012, on the file of II Additional Chief Judge, City Civil Court, Hyderabad, the unsuccessful petitioner therein preferred this Appeal, where under and whereby the petition filed under Order 39 Rules 1 and 2 of C.P.C. seeking to grant interim injunction restraining the respondents and their men from interfering with the peaceful possession and enjoyment of the schedule property by the petitioner was dismissed.
2. The appellant herein was the petitioner and the respondents herein were the respondents before the trial Court. For the sake of convenience, the parties hereinafter will be referred to as arrayed before the trial Court.
3. The petitioner filed two Interlocutory Applications under Order 39 Rules 1 and 2 of C.P.C. viz., I.A. No.400 of 2012 in O.S. No.96 of 2012 is filed for grant of interim injunction restraining the respondents and their men claiming through them from alienating the suit schedule property and I.A. No.401 of 2012 in O.S. No.96 of 2012 is filed seeking interim injunction, restraining the respondents and their men from interfering with the peaceful possession and enjoyment of the suit schedule property by the petitioner alleging that he is the absolute owner of the property having purchased the same under registered sale deed dated 07.06.1982 and the second respondent, representing the first respondent, purchased the suit schedule property under agreement of sale-cum-general power of attorney for a consideration of Rs.5,50,00,000/- and paid an advance of Rs.50,00,000/- by way of cheque dated 13.09.2008 to Bhanu Constructions Company Limited, agreed to pay balance of sale consideration to the credit of Andhra Bank Consortium. It is also further agreed therein that all the remaining conditions of agreement shall be complied within 30 days. Pursuant to the said agreement, the petitioner executed a registered agreement of sale-cum-irrevocable general power of attorney dated 21.03.2009 but the first respondent failed to pay balance sale of consideration of Rs.5,00,00,000/-, as agreed, despite demands made by the petitioner.
4. While the matter stood thus, the first respondent sold the property to respondents 3 and 4 for a total consideration of Rs.6,00,00,000/- under a registered sale deed dated 03.04.2009. The Income Tax authorities issued a notice to the petitioner on 28.12.2011 demanding the petitioner to pay capital gains tax. First and second respondents are incompetent to execute sale deed, receive balance of sale consideration from third parties without payment of balance of sale consideration, as agreed under agreement of sale-cum- general power of attorney.
5. The petitioner also contended that the possession of schedule property was not delivered to the respondents and apprehending that the purchasers may interfere with the possession and enjoyment of the suit schedule property of the petitioner, at any time, prayed to grant temporary injunction during the pendency of the suit restraining respondents and their men with the peaceful possession and enjoyment of petitioner in respect of suit schedule property.
6. First and second respondents filed counter denying the material allegations of the affidavits filed along with the petitions inter-alia contending that the agreement of sale-cum- general power of attorney is coupled with the interest and possession of the property was delivered to the respondents 1 and 2. In pursuance of the said agreement, the petitioner is not in possession and enjoyment of the property after execution of the registered agreement of sale cum- irrevocable general power of attorney. Pursuant to the registered agreement of sale-cum-irrevocable general power of attorney, first respondent sold the property to respondents 3 and 4 for a valid consideration, the petitioner is not entitled to claim any relief in the main suit. Contract between the petitioner and respondents 1 and 2 is concluded one and consideration was also passed and the subsequent alienation in favour of respondents 3 and 4 had taken place with the consent and knowledge of the petitioner. Therefore, the petitioner is not entitled to claim any relief having received the sale consideration, but the petitioner invented the story only to avoid payment of tax to the Income Tax Department towards capital gains or due to escalation of price of the suit schedule property, subsequent to execution registered agreement of sale-cum-irrevocable general power of attorney.
7. Respondents 1 and 2 further contended that they agreed to purchase the schedule property for a sale consideration of Rs.5,50,00,000/- and as per clause 14(1) of agreement of sale cum- general power of attorney the petitioner has received Rs.5,00,00,000/- and remaining balance was agreed to be paid at the time of execution of the sale deed and hand over link documents. It is further contended that the Suit is barred by limitation.
8. As per the terms and conditions of the registered agreement of sale-cum-general power of attorney, possession of the property was delivered and the terms and conditions of agreement of sale cannot be read in isolation. Thus, the petitioner was not in possession and enjoyment of the property, as on the date of filing the suit, and thereby the question of interfering with his possession and enjoyment by respondents does not arise and prayed to dismiss the petitions.
9. Respondents 3 and 4 filed their separate counters contending that they are bona-fide purchasers for a valuable sale consideration and that they are in possession and enjoyment of the property, after purchase of the same under sale deed dated 03.04.2009, thereby the question of interfering with the right, possession of the petitioner does not arise and that the story is invented to avoid payment of capital gains tax to Income Tax Department or due to escalation of price immovable property and finally prayed to dismiss the petitions.
10. During the course of enquiry, no oral evidence was adduced and no documents were got marked on either side.
11. Upon hearing arguments of both the counsel I.A. No.400 of 2012 was allowed by the trial Court granting temporary injunction restraining the respondents from alienating the suit schedule property, till the disposal of Suit, and dismissed I.A. No.401 of 2012 declining to grant interim injunction restraining the respondents from interfering with the peaceful possession and enjoyment of the petitioner in respect of the suit schedule property.
12. Aggrieved by the impugned order passed in I.A. No.401 of 2012, the present Appeal is preferred by the petitioner on various grounds mainly contending that :
a) The trial Court failed to consider the requirements for grant of temporary injunction during the pendency of the suit and referred the decisions of the Apex Court in Colgate Palmolive (India) Limited vs. Hindustan Lever Limited[1] and Zenit Mataplast Private Limited vs. State of Maharasthra and others in Civil Appeal No.18934 of 2009 decided on 11.09.2009 and Mohd.
[2]
Mehtab Khan vs. Khushnuma Ibrahim and others a n d Dorab Cawasji Warden vs. Coomi Sorab
[3]
Wardenand others ;
b) It is further contended that the trial Court did not appreciate the evidence in proper perspective and dismissed the petition erroneously.
And finally prayed to allow the Appeal setting aside the impugned order and decretal order dated 12.10.2012 passed in I.A. No.401 of 2012 in O.S. No.96 of 2012, on the file of II Additional Chief Judge, City Civil Court, Hyderabad.
13. During the course of arguments, learned counsel for the petitioner mainly contended that when the agreement of sale-cum- general power of attorney was executed in favour of the respondents 1 and 2 without paying balance sale consideration of Rs.5,00,00,000/-, as agreed there under, they are not competent to execute registered sale deed in favour of respondents 3 and 4 and that too the possession of the property was not delivered to the respondents 1 and 2, thereby the question of their continuing in possession and enjoyment of the property does not arise but the trial Court did not consider this aspect in proper perspective and dismissed the petition without any legal basis, finally, prayed to allow the Appeal setting-aside the impugned order and decretal order by granting temporary injunction restraining the respondents and their men from interfering with the peaceful possession and enjoyment of the suit schedule property, during the pendency of the Suit.
14. Per contra, learned counsel for the respondents mainly contended that the Suit is filed for cancellation of the registered agreement of sale-cum-irrevocable general power of attorney. In fact, the document cannot be cancelled since it is an agency coupled with interest. Therefore, the petitioner is not entitled to claim the relief in the main suit itself. Added to that, the remedy open to the petitioner is to claim charge over the property for unpaid purchase money, if any, and that the possession of the property was delivered to the respondents 1 and 2 in pursuance of the agreement of sale-cum-general power of attorney and as per the terms of the sale, the first respondent executed registered sale deed in favour of respondents 3 and 4 and delivered vacant possession to them and as such the trial Court rightly dismissed the petition filed by the petitioner for grant of temporary injunction restraining the respondents from interfering with the alleged possession and enjoyment of the schedule property by the petitioner.
15. Considering rival contentions and perusing the material available on record the point that arises for consideration in this Appeal is:
Whether the petitioner is in possession and enjoyment of the property, as on the date of filing the Suit, even after execution of registered agreement of sale-cum- irrevocable general power of attorney? If so, whether the respondents made any attempt to interfere with the lawful possession and enjoyment of the schedule property and whether the petitioner is entitled to prohibitory order of injunction restraining the respondents from interfering with the alleged peaceful possession and enjoyment of the schedule property, during pendency of the Suit?
16. Admittedly the petitioner is the owner of the suit schedule property; it is also an admitted fact that the petitioner executed an agreement of sale-cum-general power of attorney in favour of first respondent, representing the second respondent, agreeing to sell the schedule property for a sum of Rs.5,50,00,000/- incorporating various terms in the document and one of the terms and conditions of the document is that the respondents 1 and 2 shall pay balance sale consideration on the date of execution of registered sale deed. Second respondent, representing first respondent, paid an advance sale consideration of Rs.50,00,000/- by way of cheque dated 13.09.2008 to the Bhanu Constructions Company Limited and the balance was agreed to be paid to the credit of Andhra Bank Consortium on the date of execution of registered sale deed and that the respondents 1 and 2 have to comply the remaining terms and conditions of the agreement of sale within 30 days from the date of execution of the registered agreement of sale-cum-general power of attorney. Accordingly, respondents also admitted about obtaining registered agreement of sale-cum-irrevocable general power of attorney dated 21.03.2009, where under the respondents agreed to pay Rs.50,00,000/- as advance of sale consideration while agreeing to pay balance sale consideration on the date of execution of sale deed but the dispute is regarding delivery of vacant possession of the schedule property and non payment of balance sale consideration of Rs.5,00,00,000/-, it is contended that only Rs.50,00,000/- is to be paid on the date of execution but not Rs.5,00,00,000/-, while contending that the entire balance of sale consideration was paid to the petitioner.
17. Though, the petitioner and respondents admitted several facts, they did not produce any document, more particularly, the registered agreement of sale-cum-irrevocable general power of attorney to find out whether it is possessory agreement of sale-cum-general power of attorney or non possessory and delivery had taken place or not is the crucial aspect for deciding the real controversy between the parties for grant of temporary injunction based on possession.
18. No doubt, according to the contentions of the petitioner, total sale consideration agreed to be paid under agreement of sale-cum- general power of attorney by the respondents 1 and 2 is Rs.5,50,00,000/- and on the even date Rs.50,00,000/- was paid by way of cheque dated 13.09.2008 on the date of execution of agreement of sale-cum-general power of attorney while agreeing to pay balance sale consideration to the credit of Andhra Bank Consortium but failed to pay balance of Rs.5,00,00,000/- and sought for cancellation of registered agreement of sale-cum-irrevocable general power of attorney in the main suit itself under Section 31 of Specific Relief Act, 1963. In fact, the Hon’ble Apex Court recently taken a serious view about the transactions covered by agreement of sale-cum-general power of attorney in Suraj Lamp and Industries
[4]
Private Limited Vs. State of Haryana and another , wherein it was held as follows:
"24. We therefore reiterate that immovable property can be legally and lawfully transferred/conveyed only by a registered deed of conveyance. Transactions of the nature of “GPA sales” or “SA/GPA/will transfers” do not convey title and do not amount to transfer, nor can they be recognized or valid mode of transfer of immovable property. The Courts will not treat such transactions as completed or concluded transfers or as conveyances as they neither convey title nor create any interest in an immovable property. They cannot be recognized as deeds of title, except to the limited extent of Section 53-A of the T.P. Act. Such transactions cannot be relied upon or made the basis for mutations in municipal or revenue records. What is stated above will apply not only to deeds of conveyance in regard to freehold property but also to transfer of leasehold property. A lease can be validly transferred only under a registered assignment of lease. It is time that an end is put to the pernicious practice of SA/GPA/will transactions known as GPA sales.
25. It has been submitted that making declaration that GPA sales and SA/GPA/will transfers are not legally valid modes of transfer is likely to create hardship to a large number of persons who have entered into such transactions and they should be given sufficient time to regularize the transactions by obtaining deeds of conveyance. It is also submitted that this decision should be made applicable prospectively to avoid hardship.”
19. But, it is not a law declared by the Apex Court, it is only an obiter dicta. However, these principles are binding on the High Courts and other Courts in view of the decision of the Apex Court in
[5]
Municipal Committee vs. Hazara Singh wherein it was held as follows:
“ Ev en obiter Dictum of the Supreme Court should be accepted as binding. But statements on matters other than law have no binding force. Since on facts no two cases are similar, Supreme Court’s decisions which are essentially on questions of fact cannot be relied upon as precendents for decision of other cases.”
20. But, in another decision of the Apex Court in Sreenivasa
[6]
General Traders vs. State of Andhra Pradesh it was held as follows:
“obiter had no persuasive value and every judgment must be read as applicable to the particular facts proved, or assumed to be proved, since the generality of the expressions which may be found there are not intended to be expositions of the whole law but governed or qualified by the particular facts of the case in which such expressions are to be found”.
21. Thus, the principles laid down by the Apex Court are authoritative pronouncements of the Apex Court. The obiter dictum laid down by the A pex Court in Municipal Committee (5th supra) is binding and it has got persuasive value. In another judgment of the
[7]
Apex Court in Sarvan Singh Lamba vs. Union of India , wherein it was held that ‘generally, even an obiter dictum is expected to be obeyed and followed’. In Saiyada Mossarrat vs. Hindustan Steel
[8]
Limited., Bhilai Steel Plant , the Apex Court held as follows:
“Sometimes well considered obiter dicta of the Supreme Court is taken as precedent, but every passing expression of a judge cannot be treated as an authority”’
22. On consideration of the principles laid down by the Apex Court in the decisions cited supra, it is clear that obiter dicta laid down by the Apex Court is binding on the High Courts and other Subordinate Courts and generally it can be treated as a precedent. Therefore, the principle laid down by the Apex Court in Suraj Lamp and Industries Private Limited (4th supra) though on obiter dicta which is binding on all the High Courts and Subordinate Courts in India, in view of the principal laid down by the Apex Court in Suraj Lamp and Industries Private Limited (4th supra), the agreement of sale-cum-general power of attorney is not enforceable under law and a direction was issued to all the Registrars not to register such documents from the date of above judgment. Thus, the judgment is only a prospective in application but had no retrospective effect. Even assuming for a moment that the above judgment has no application to the present facts of the case, though the principle laid down by the Apex Court is not applicable, still keeping in mind the principles referred above Courts have to examine the validity of the document.
23. Undoubtedly the agreement of sale-cum-general power of attorney is an agency coupled with interest. Section 202 of Indian Contract Act, 1872, deals with termination of agency, where agent has interest in the subject matter and according to it, whether the agent himself has interest in the property which forms the subject matter of the agency, the agency cannot, in the absence of express contract, be terminated to the prejudice of such interest. Thus, in view of the bar under Section 202 of Indian Contract Act, an agency coupled with interest is an irrevocable agency unless there is a contract for such revocation. In the instant case on hand, registered agreement of sale- cum-general power of attorney was not brought on record by both the parties to the petition to find out whether there is any express permission for revocation of such agency coupled with interest. Therefore, it is difficult for the Courts to find out whether there is any clause for termination of agency in the registered agreement of sale- cum-general power of attorney. Hence, it is difficult to express any opinion about the terms and conditions of the registered agreement of sale cum-general power attorney with regard to revocability or termination of agency.
24. When the petitioner executed an agreement of sale-cum- general power of attorney, if any authorization is given to the agent, i.e. first respondent to deal with the property including execution of the sale deed receiving consideration from the third party etc., if such authority is conferred on the agent, the contract entered into by the agent can be enforced against the principal by the parties who entered into contract in view of Section 226 of Indian Contract Act. Thus, the contracts entered by the agent, first respondent, on behalf of the principal, petitioner, are binding on the petitioner. Even if the agent exceeds his power or authority conferred on him, and if such acts are separable, the principal i.e., the petitioner is not bound by such separable contracts. Section 231 of Indian Contract Act says that ‘if an agent makes a contract with a person who neither knows, nor has reason to suspect, that he is an agent, his principal may require the performance of the contract; but the other contracting party has, as against the principal, the same rights as he would have had as against the agent if the agent had been the principal’. Thus, it means the parties who entered the contract with an agent, can enforce such contracts against the principal and such contracts are binding and whatever acts done by the agent during subsistence of agency are binding on the principal, if their acts are within the four corners of the authority conferred on the agent under Section 231 of the Indian Contract Act. But, in the instant case on hand, it is difficult for this Court to find out whether any authority was conferred on the agent, first respondent to execute registered sale deed and to receive sale consideration acting on behalf of the petitioner (principal). Therefore, we ourselves are constrained to the material available on record, without expressing any opinion. Thus, it is clear from the record that the petitioner suppressed the material document which is the basis for the entire Suit and sought for cancellation of the document, which was not marked as exhibit, during enquiry in this petition, thereby, we are unable to conclude whether the agent acted beyond the authority conferred on him under the registered agreement of sale-cum- irrevocable general power of attorney executed by the petitioner (principal) in favour of respondents 1 and 2.
25. Similarly, it is the case of petitioner that no possession of the schedule property was delivered to the respondents 1 and 2; but whereas the respondents’ contention is that possession of the property was delivered and after execution of registered agreement of sale- cum-irrevocable general power of attorney, the first respondent delivered vacant possession of the property to the purchasers i.e., respondents 3 and 4 and they are in possession and enjoyment of the property. Strangely, both the parties did not produce any piece of evidence including the alleged registered agreement of sale-cum- irrevocable general power of attorney to find out whether the agreement of sale is possessory agreement of sale-cum-general power of attorney or not. In fact, a copy of the document is filed along with the material papers in this Appeal but unless it is marked as exhibit, it cannot be looked into. Therefore, the photostat copy of the document i.e., registered agreement of sale-cum-general power of attorney was not looked into since it was not marked as exhibit before the trial Court as contemplated under Rule 60 of Civil Rules of Practice and Circular Orders, 1980, which says that ‘any fact required to be proved in an interlocutory proceeding, shall unless otherwise provided by these rules, or ordered by the Court, be proved by affidavit but the judge may, in any case, direct evidence to be given orally, and thereupon the evidence shall be recorded, and exhibits marked, in the same manner as in a suit and lists of the witnesses and exhibits shall be prepared and annexed to the judgment’.
26. So, a document is required to be marked when relied on the documentary evidence but when no document is marked as exhibit, this appellate Court cannot look into the same though it is available on the record. If for any reason the registered agreement of sale-cum- irrevocable general power of attorney is possessory agreement of sale, certainly, the contents shall be taken into consideration and basing on it, the Court can come to a conclusion that the possession of the property was delivered to the respondents. But, here no material is available except the allegations made in the affidavit by the petitioner to the effect that the possession of the property was not delivered and the allegations made by the respondents to that effect that the possession of the property was delivered since agreement of sale- cum-general power of attorney is a possessory agreement of sale- cum-general power of attorney. Therefore, non production of the material document is fatal to the case of the petitioner. In those circumstances, we are unable to express any opinion with regard to possession of the property by the petitioner by the date of filing the petition along with the suit.
27. The relief under Order 39 Rules 1 and 2 is an equitable, discretionary relief and when the petitioner approached the Court seeking the said relief he has to prove that he is in possession and enjoyment of the property and the respondents are trying to interfere or infringe the legal right of the petitioner to continue in possession of the property. Obviously for different reasons the petitioner did not produce any scrap of paper to prove that he is continuing in possession and enjoyment of the property and even did not produce registered agreement of sale-cum-irrevocable general power of attorney for inspection of trial Court to decide the real controversy with regard to retaining possession by the petitioner or delivery of possession to the respondents as contended by the respondents etc., Thus, the petitioner failed to establish that he is in possession and enjoyment of the property, as on the date of filing the suit. However, he being the owner is presumed to be in possession of the property by applying the principle that ‘possession follows title’. The material on record is insufficient to decide the facts in controversy, more particularly, regarding delivery of possession of the property or retaining the possession of the property by the petitioner and invasion or infringement of the legal right of the petitioner to enjoy the schedule property. Hence, on the basis of insufficiency of material, we are unable to decide the present Appeal effectively and we feel that it is a fit case to remand the matter to the trial Court exercising power under Order 41 Rule 23(A) of C.P.C.
Accordingly, the Appeal is disposed of with a direction to the trial Court to decide the matter, in accordance with law, un-influenced by any of the observations made in this Appeal, within a period of three months from the date of receipt of a copy of this order, after affording reasonable opportunity to both the parties to produce evidence, if they wish to produce, and decide who is in possession and enjoyment of the property, as on the date of filing the Suit, and whether there is any infringement or invasion of the legal right of the petitioner.
In consequence, the miscellaneous petitions, if any, pending in this Appeal, shall stand closed. No order as to costs.
ASHUTOSH MOHUNTA, J Date: 24-01-2014.
Dsh M. SATYANARAYANA MURTHY, J HON’BLE SRI JUSTICE ASHUTOSH MOHUNTA AND HON’BLE SRI JUSTICE M. SATYANARAYANA MURTHY
CIVIL MISCELLANEOUS APPEAL No.239 OF 2013
(Judgment of the Division Bench delivered by Hon’ble Sri Justice M. Satyanarayana Murthy)
Date. -01-2014
DSH
[1] AIR 1999 SC 3105
[2] 1013 STPL (Web) 70 SC
[3] (1990) 2 SCC 117
[4] 2011 (6) ALT SC 1
[5] AIR 1975 SC 1087
[6] AIR 193 SC 1246
[7] (1995) 4 SCC 546
[8] (1989) 1 SCC 272