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M.S. Ananthamurthy & Anr. v. J. Manjula Etc. Etc.

Civil Appeal · 2025 INSC 273Decided 27 Feb 2025
C.A. No.-003266-003267 - 2025 (arising from SLP(C) Nos. 13618-13619 of 2020)
Justice J.B. Pardiwala · Justice R. Mahadevan

Background

In 1986, the original owner of a residential plot in Bangalore executed an irrevocable General Power of Attorney along with an unregistered agreement to sell in favour of one A. Saraswathi, for a stated consideration, and handed over possession. After the original owner died in 1997, the GPA-holder executed a registered sale deed in her own favour and later transferred the property to the appellants. Separately, the legal heirs of the original owner executed a registered gift deed over the same property in favour of another party (the respondent), triggering competing civil suits over title and possession that were decided against the appellants by the trial court and the Karnataka High Court.

Decision Breakdown

The Supreme Court examined the GPA and the agreement to sell both independently and jointly, and reaffirmed settled law (following its earlier decision in Suraj Lamp) that a General Power of Attorney is merely a creation of an agency relationship, and neither a GPA nor an unregistered agreement to sell can, by itself or together, transfer ownership/title in immovable property, only a registered sale deed can do that. The Court also clarified when a finding on title in an earlier injunction suit operates as res judicata in later proceedings, holding that where title was directly and substantially in issue and necessary to grant the injunction, a separate declaratory prayer is not required for that finding to bind the parties. Applying this, the Court found no error in the High Court's judgment and upheld the dismissal of the appellants' claims, since they could not establish valid title through the unregistered instruments.

Lesson Learnt

A General Power of Attorney combined with an unregistered agreement to sell does not transfer ownership of property: buyers relying on "GPA sales" instead of a registered sale deed risk losing the property entirely, no matter how long they have held possession or paid consideration.

Official source (sci.gov.in)View Judgment (PDF)

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