Property Law

Manik Majumder v. Dipak Kumar Saha

2023 SCC OnLine SC 37; (2023) 8 SCC 410

Facts

Braja Mohan Dey owned the disputed property.
He later went to East Pakistan.
Dhirendra Chandra Saha, who had been Braja Mohan’s tenant and allegedly his creditor, claimed that Braja Mohan executed a power of attorney in his favour abroad.
Relying on that alleged authority, Dhirendra executed a sale deed in 1968 as attorney-holder of Braja Mohan, transferring the property to himself.
A further transfer was subsequently made.
The original power of attorney was not produced in court.
The trial court and first appellate court rejected the plaintiffs’ title.
The High Court reversed those concurrent findings by relying principally on presumptions arising from registration.
The Supreme Court delivered split opinions; Justice M.R. Shah’s judgment allowing the appeal constituted the operative result.

Whether registration of a sale deed proves that the alleged attorney possessed valid authority to execute it.
Whether a power-of-attorney holder can transfer the principal’s property to himself without proving the precise authority granted.

Registration creates a rebuttable presumption regarding regular execution of a document.
It does not independently prove:
the transferor’s title;
the existence and scope of agency; or
authority to engage in self-dealing.
Where a principal resides outside India, the power of attorney relied upon for registration must satisfy Sections 32 and 33 of the Registration Act.
An agent must act within the authority granted by the principal.
A transaction in the agent’s own favour requires especially clear authority and careful proof.

The original power of attorney was the foundation of the entire chain of title.
Without it, the court could not determine whether Dhirendra was authorised:
to sell at all;
to determine the price;
to receive consideration; or
to convey the property to himself.
The document was allegedly executed outside India, but compliance with the required authentication procedure was not proved.
The registering officer’s endorsement could not replace proof of the foundational power of attorney.
Registration of the later sale deed only showed that the deed was registered; it did not establish that the principal had validly authorised the agent.
The self-sale was inherently a transaction requiring strict scrutiny because the agent stood on both sides of the conveyance.
The High Court therefore erred in using a general presumption of validity to overcome the absence of the very document conferring authority.
The plaintiffs failed to prove a lawful transfer from the true owner, and hence failed to establish title.

The alleged power of attorney and its statutory authentication were not proved.
The registered sale deed could not create title when the agent’s authority remained unestablished.
The High Court’s decree was set aside.
The concurrent dismissal of the plaintiffs’ suit was restored.