Devendra Singh vs Great Home Developers Pvt. Ltd,2026

Case Name: Devendra Singh vs Great Home Developers Pvt. Ltd

Court: Allahabad High Court

Year 2026

Appellant/Plaintiff: Devendra Singh

Respondent/Defendant: Great Home Developers Pvt.Ltd

Facts of the Case

Appellant Devendra Singh was the owner of 1/3rd portion of land measuring 3.34 hectres of Khasra nos. 175, 160, 109, 194, 196, 197, 198, 199 and 797, situated at village Hasanpur Lodha, Tehsil Dhaulana, District Hapur.He had sold out his 1/3rd portion to Great Home Developers Pvt.Ltd through a registered sale deed dated 10th December 2008 which was registered at Book No. 1 Volume 5739 page 108/201 number 11567 before Sub-Registrar, Hapur,and the name of the respondent/defendant was also mutated in the revenue records. Later on appellant/Plaintiff filed a suit for cancellation of sale deed stating that the entire sale consideration amount has not been paid & the cheques of amount ₹ 3,71,04,750 have been dishonored the sale deed should be declared null and void.

Legal Issues Involved

  1. Whether the registered sale deed can be cancelled under section 54 of the Transfer of Property act, 1882 if the consideration amount has not been paid.
  2. Whether the appellant/plaintiff executed the sale deed on his own will with good and sound mind.

Legal Provisions Involved

  1. Section 54 of the Transfer of the Property Act,1882
  2. Section 91 of the Indian Evidence Act,1872

Argument by Parties

Appellant/Plaintiff Arguments:

At the time of registration of said sale deed, the respondent/defendant has paid three cheques of Opus Buildtech Pvt. Ltd Company. They were honored.

Check NumberDatedAmount
23351/9/201070 lacs
233620/9/201070 lacs
233710/9/201070 lacs

In the said registered sale deed, the receiving of Rs. 3, 76,000/ has been wrongly mentioned. In lieu of said cheque amount, a cheque of same amount vide cheque no. 21330 dated 20.7.2010 of Bank of India, Noida was given which was signed by Vaibhav Agrawal son of Sri Kailash Chandra. Hence, defendant/respondent has given the aforesaid four cheque of sale consideration. The sale deed was registered and executed on this assurance that after payment of entire sale consideration, the possession would be delivered and the defendant/respondent will get right of ownership and till then, possession over the land in question would remain continue with the appellant/plaintiff. The plaintiff/appellant did not raise objection of execution of sale deed on government rate.

Thereafter defendant/respondent further gave three more cheques signed by Vaibhav Agarwal which were also dishonored

Check NumberDatedAmount
188001/08/201170 lacs
188102/08/201170 lacs
188103/08/201170 lacs

The defendant further issued the following check which were also dishonored

Check NumberDatedAmount
2132910/02/200940 lacs
2132802/09/201062,28,750 lacs
878610/02/201140 lacs

Amount Received by the plaintiff/Appellant

Check/DD NumberDatedAmount
288721/01/20115 lacs
 25/02/201110 lacs
 21/04/201110 lacs
 4/5/201110 lacs
  1,78,20.000
Total 2,13,20,000

Out of 5, 84, 24,750 only 2, 13, 20,000 was paid. The balance amount of 3, 71, 04,750 stil remains outstanding till date. The defendant did not pay agreed sale consideration to the plaintiff/appellant.The mutation in the name of defendant/respondent has also taken place on12/01/2009. The defendant/respondent had threatened on 1.12.2010 to take possession and refused to pay balance sale consideration, hence, the present suit was filed.

Defendant/Respondent Argument

The defendant/respondent had denied all the paragraph of plaint. According to the defendant here was no agreed amount between plaintiff and defendant for purchase of said property at the rate of Rs. 44,25,000/ per Bigha. There was no total sale consideration was ever agreed as Rs. 5, 84, 24,750/-.According to the defendant agreement took place between the plaintiff and the defendant for sale and purchase of said property @ Rs. 800/ per sq. meter i.e. total sale consideration of Rs. 2, 13, 76,000/-.The defendant also denied that there was any agreement between plaintiff and defendant that plaintiff would deliver possession of said property after registered sale deed and payment in next 20 months. Whereas, correct fact is that the sale consideration has been agreed between plaintiff and the defendant on the basis of cash and cheques. The physical possession has already been delivered by the plaintiff to the defendant on the same day when the registered sale deed was executed.

Judgment

In the present matter, the sale deed is a registered document; hence its correctness is its presumption. The mutation has also been made in favour of respondent/defendant and for next two and half year, the plaintiff/appellant even did not raise any objection either before any competent authority. The mutation is also in the name of respondent/defendant and the plaintiff has also admitted in his cross-examination that mutation of said land in the name of respondent/defendant is even in his knowledge and he had not raised any objection because there was no dispute at that time. In the said sale deed, terms and condition had been duly agreed between the appellant/plaintiff and the respondent/defendant. It has been specifically mentioned in the said sale deed that at the time of registration and execution of sale deed, the possession had also been delivered by the plaintiff/appellant to the defendant/respondent on the spot. In the last paragraph of said sale deed, it is duly agreed that three cheque of Rs. 70 lacs each has been received by the appellant/plaintiff as sale consideration drawn at Bank of India, Noida and amount of Rs. 3,76,000/ has been received by him in cash and by these means, he has received entire sale consideration and now, no amount has been left and nothing would be considered in future. Hence, in view thereof, it is clear that regarding said sale deed, the entire sale consideration has been paid by the purchaser to the plaintiff/appellant. If there is any dispute of money, the appellant/plaintiff is having right to file appropriate civil proceedings for recovery of money. The present sale deed could not be declared as void in view of Section 54 of the Transfer of Property Act, 1882.

Ratio Decidendi

The core ratio decidendi establishes that under section 54 of the Transfer of Property Act, 1882 cannot be cancelled on the basis of partly or unpaid sale consideration.

Appropriate Legal Remedy

If the sale consideration has not been paid or has been partly paid then instead of cancellation of sale deed the correct legal course of action would be to file a civil suit for recovery of money.

Statutes/Provisions Involved

Section 54 of the Transfer of Property Act,1882

Section 91 of the Indian Evidence Act,1872

Section 138 Negotiable Instruments Act,1938

Order 7 Rule 11,Civil Procedure Code,1908

Precedents Relied On

  1. Dahiben Vs Arvindbhai Kalyanji Bhanusali(Gajra)(2020) 7 SCC 366
  2. Vidyadhar Vs Manikrao AIR 1999 SC 1441
  3. Raziya Begum & Ors Vs Nafisa Begum(2026) INSC 814
  4. Ishwar Das Jain Vs Sohan Lal ALR 2000(39) 756
  5. Raghavamma Vs Chenchamma AIR 1964 SC 136
  6. Laxmi Narain &Ors Vs Hubraja ALR 1989(15) 800
  7. Smt.Prabhavati Devi Vs. Smt.Champa Devi RD 2012(117) 341
  8. Guru Nath Manohar Pavaskar & Ors Vs Nagesh Siddapa Navalgund & Ors 2008 RD(104) 243
  9. Maria Margarida & Ors Vs Erasmo Jack 2012 ALR(92) 251
  10. Bhobhal Vs Shah Nath 2012 RD(115) 759

IS CHINA TO BLAME FOR THE NEPAL FLASH FLOODS-2026

According to the experts the flash floods in Nepal has no direct connection with the Medog Hydropower Project of China, however this project is being build on the earthquake prone region of the Himalayas which puts India situated on the downstream on high economic, social & environmental risk. China is being criticized for not issuing early warning signs or real time hydrological data on the movement of the water downstream.

Reasons For Nepal Floods

Glacial Lake Outburst Floods(GLOF)-In the Hindu Kush Himalaya moraine dammed glacial lakes are common & GLOF are the result of failure of moraine dams. When water melts and accumulates between proglacial moraine and retreating glacier. Retreating Glacier is a phenomenon when glacier looses more of its mass due to rising temperature rather than accumulating mass due to snowfall. Proglacial moraine is formed when rock debris is deposited by glacier.

According to Nepal’s National Disaster Risk Reduction and Management Authority (NDRRMA) the recent flash floods in Nepal has been due to an earthquake of 4.4 magnitude near Nepal China border due to which a huge glacier collapsed near Langtang Lirung peak. The area where the glacier was detached has seen formation of lake whose area is around 0.25 square kilometer. It caused the Bhote Koshi river flowing into the Rasuwa district of Nepal before feeding into Trishuli and Narayani in (Nepal) & Gandak in (India) to rise almost 30 feet and resulted in flash flood in Nepal which has claimed lives of over 600 people and around 2,500 people have been reported missing. Any rise in Narayani would consequently increase water level in Gandak increasing the risk of flood in eastern Uttar Pradesh & northern Bihar.

According to a report published by International Centre For Integrated Mountain Development in 2019 the Hindu Kush Mountain region would warm by at least 0.30C more than the entire world. Consequently the air which is hot is able to hold more moisture which results in the permafrost conditions of the Himalayas to melt, this is what has happened in the Rasuwa district of Nepal.

Out of 7,500 glacial lakes situated in Himalayas, about 10 percent are in Sikkim and 25 percent are extremely dangerous. The study has also revealed that around 4,700 of these glacial lakes are situated in Ganga river basin and has a catchment area of around 2.5 lakh square kilometer which could result in mass scale devastation.

According to a survey conducted by Indian National GLOF Risk Mitigation Program 195 glacial lakes have been identified which are at risk and need a structured risk mitigation program to minimize the damage especially north Bihar as around 73% of the land is with the flood plains of GLOF rivers such as Kosi, Gandak and Mahananda. It is estimated that roughly 22 percent of flood effected Indian population lives in Bihar.

Building embarkment which raise the riverbed through sediment and concrete deposition would not solve the problem as study has shown that rivers can cut new channel from the embanked course. Glacial lake monitoring, automated telemetry can be used to analyze threats and should be shared across borders for real time disaster management. The people should be relocated from the narrow river valleys. The hillsides should be eased and the infra projects near mountains should go slow as China’s recent activity in Tibet induced disaster in three countries including China, Nepal & India.

Diplomatic Uncertainty Stalls the Visit of Bangladesh Prime Minister to India

Bangladesh Prime Minister was expected to visit India between August 23rd & August 25th 2026,however Bangladesh clarified that no decision has been made so far & the national interest of Bangladesh would be the priority. Within days of the swearing ceremony of the newly elected Prime Minister of Bangladesh on February 17th,2026 a personalized letter of invitation was send by Prime Minster Narendra Modi to pay a state visit to India. The invitation remains unacknowledged as the invitation has neither been accepted or declined.

Instead of any formal communication in a interview given by the foreign affairs advisor to the Bangladesh Prime Minister to Bangladesh Sangbad Sangstha, India has been told to create conducive environment for the visit of Bangladesh Prime Minister Tarique Rahman to India.

With the toppling of the Sheikh Hasina government in August 2024 and India giving refuge to Sheikh Hasina has resulted in bitter relations between India and Bangladesh.

Key Reasons Why Friends Have Turned into Foes:

Sheikh Hasina took refuge in India after her ouster in August 2024 and Bangladesh is demanding her extradition.

Most of the Bangladeshi people think that Hasina was able to continue as a Prime Minister by rigging the polls due to support from India. She also helped India by stopping anti India rebel groups operating from Bangladesh.

After the ouster of Sheikh Hasina government there was huge spread communal clashes in which thousand of minority Hindus were killed which invoked large scale criticism in India.

Long & delayed disagreement over the water sharing of the Teesta river as the proposed water sharing agreement of giving 42.5 percent dry season water to India,37.5 percent water to Bangladesh and remaining 20 percent water for the environmental flow remains unaccepted and unresolved. Recently Bangladesh has proposed China to provide technical assistance in Teesta river management. Similarly the Ganges water treaty signed in 1996 is coming to an end in December 2026.

Border disputes due to unchecked cross border movements and infiltration of Bangladeshi nationals in India. Bangladesh is reengaging ties with Pakistan and China.

The Rahman government is under tremendous pressure from the opposition parties in Bangladesh when it comes to improving ties with India as giving asylum to Sheikh Hasina is the biggest hurdle as easing ties with India could fuel the already existing domestic crisis in Bangladesh. This is the last thing that the Bangladesh government would want as of now.

Surging Sugar Prices in India (2026) & Ethanol

According to United States Department of Agriculture, Foreign Agricultural Services, New Delhi the the sugar cane production output in India is expected to increase by 2% in the year 2026-27 as compared to 2025-26 & the sugar production is expected to increase 12 percent for the year 2026-27 in comparison to 2025-26.However inspite of increase in production of sugar the prices of sugar according to Press Information Bureau has risen from ₹ 48.10 per kilo as of on July 20th to ₹ 55.70 as of on August 20th 2026.

Why Sugar Prices are Rising

According to Press Information Bureau the rising prices of sugar is due to combination of factors such as production of sugar has been affected by fungal plant disease Red Rot & insect pest Top Borer disease in sugarcane beside excess rainfall has also destroyed the crop which may lower the production to 306 lakh metric ton from an earlier estimate of 343 lakh metric ton. The demand of sugar has increased as the festive season is approaching. The rise in sugar prices is not limited to India but the sugar prices have risen all around the globe due to the Iran war and El Nino effect as a result in less than 2 months prices of sugar have increased around 16%.Hoarding by traders to maximize their profits is also acting as a catalyst to increase the rise of sugar prices .To control hoarding government has put a cap of 400 ton on sugar stock for each sugar dealer from 1st August to 26th November 2026 From 1st September 2026 the bulk consumers would not be allowed to hold sugar stock exceeding 15 days. Both central and state are carrying out the physical inspection of sugar mills to check sugar stocks and scarcity. The government has advised the next crushing cycle to start from October 15th 2026 to increase the October production of sugar. According to a report from All India Kisan Sabha the opening stock of sugar is 38 lakh tons which is slightly lower than the opening stock of last year which was 42 lakh ton.4 lakh ton deficit cannot result in such surge of price rise of sugar.

Ethanol or E 20 Policy: E-20 policy of the government requires petrol pump all over the country to sell petrol blended with 20 percent ethanol along with 80 percent petrol all across the country. According to reports 32 percent of the ethanol supply comes from sugarcane while 68 percent of the ethanol supply comes from maize and broken rice etc. which means roughly 3 million ton of sugar is diverted towards the production of ethanol. Before the policy came into force India was the second largest sugar exporter after Brazil, however this year on August 20th 2026 Indian government has permitted duty free import of one million metric ton of raw sugar to bring down the sugar prices before the festive season. Importing due to natural disaster or calamity is not a bad decision even Brazil imported the coffee beans in 2017 due to drought, however importing due to man made decision should be given a second thought as reducing the petroleum import at the cost of increasing the sugar import should draw the attention of policy makers as food should not be compared with petrol. This may sound a good political decision in short term for the sugarcane farmers of Uttar Pradesh as they may get good price for their produce but this may not be good for all the Indians. Farmers are growing more of sugarcane and maize reducing the land for pulses and oilseeds. Even in July this year the egg prices went up because maize was diverted for ethanol production as a result the chicken feed became costly. However diverting excess sugar towards the production of ethanol has helped the sugar mills to solve their financial problems, restructure their business model and reduce the government subsidy. Consequently as of 20th August 2026 ,97 percent of the sugarcane debt for the 2025-26 sugar season have already been paid to the farmers. Between 2014 and 2021 around ₹ 14,600 crore of subsidy was provided to the sugar industry while no such subsidy has been announced since 2021-22.The consumer sugar prices have also remained fairly stable with around 3 percent price increase between August 2024 and July 2026.

The Government has stated that both the interest of consumers and sugarcane farmers would be protected by monitoring the sugar stocks and prices and would ensure best market practices to prevent hoarding and artificial scarcity while ensuring timely payment to farmers

Chhuttan Vs. The State of U.P(2009). Allahabad High Court under section 38 Specific Relief Act,1963 & Article 300A of Indian Constitution.An occupant in physical, peaceful, and settled possession of land cannot be evicted by summary or extra-judicial methods, even if their lease has expired.2009 Revenue Digest(108) 685..2009 AWC(6)5635.2009 ALR(77) 187

Neutral Citation No. – 2009:AHC:3160Court No. 19

SECOND APPEAL NO. 2876 OF 1983

Sri Chhuttan ——- Plaintiff-Appellant

Vs.

The State of U.P. and another ——- Defendant-Respondents

*******

Hon’ble Pankaj Mithal, J.
Heard Sri Triveni Shankar, learned counsel for the plaintiff-appellant and Sri M.P. Singh, learned Standing counsel for the defendant-respondents.
The plaintiff-appellant was granted lease for a fixed term of the forest land for agricultural purposes. The aforesaid lease on the expiry of the fixed term was extended and ultimately expired on 31.5.1981 after which it was not extended. On the expiry of the lease period the defendant-respondents sought to evict the plaintiff-appellant from the land in dispute. Therefore, the plaintiff-appellant instituted a suit for permanent injunction basically on the ground that as he is in possession he is not liable to be evicted otherwise than by following the due process of law. The suit was decreed by the Court of first instance with a categorical finding that the plaintiff-appellant is in actual possession of the land in dispute. The appeal preferred by the defendant-appellants was allowed and the decree passed by the Court of first instance was set aside with the result the suit was dismissed holding that as the lease stood expired the plaintiff-respondent has no right to remain in possession. It is against the judgment, order and decree dated 17.9.1983 passed by the lower appellate Court that the plaintiff-appellant has preferred this second appeal.
One of the substantial questions of law which arises for determination in this appeal is as to whether the plaintiff-appellant who is in settled possession of the land in dispute, as per findings of the Court of first instance which findings have not been reversed by the lower appellate court, can be dispossessed from the same without taking recourse to the procedure established by law.
In the instant case admittedly the initial lease granted to the plaintiff-appellant was up to 31.5.1977 on payment of Rs. 600/- per month as lease rent. It was extended and the last extension expired on 31.5.1981 whereupon the lease was never renewed. However, the plaintiff-appellant continued to be in possession. The Court of first instance records a clear finding that the plaintiff-appellant is in possession of the land in dispute even on the expiry of the lease period and that no plantation has been done on it by the forest department. This finding has not been reversed and no contrary finding holding the possession of the defendant-respondents over the land in dispute has been returned by the lower appellate Court. There is no material otherwise to disturb the finding of possession so recorded by the trial court. Thus, it is clear that the plaintiff-appellant is in actual possession of the land in dispute which he came to occupy lawfully under a valid lease. It is also not disputed that no such proceedings either under the U.P. Public Premises (Eviction of Unauthorised Occupants) Act, 1972 or under general civil law were even initiated by the defendants-respondents for the eviction of the plaintiff-appellant or for recovery of possession from him.
Now the question is whether the plaintiff-appellant can be dispossessed straight away as the lease has expired or that the defendants-respondents have to obtain a decree/order of eviction from the appropriate court/authority.
Law discourage people from taking law into their own hands. Therefore, persons are not permitted to take forcible possession and they are supposed to obtain possession as they are entitle to through Court. Therefore, based upon the above principle, it is settled legal position in India that a person who is in settled possession of the land cannot be thrown out by force without following the due process of law which certainly means that the owner has to take out legal proceedings for evicting a person who is in possession of the even if provided he has no such right to remain in possession thereof.
The apex court in (1977) 1 SCC 188 Ram Rattan And others Vs. State of Uttar Pradesh in dealing with a right to private defence of a trespasser against a true owner held that though a true owner has every right to dispossess or throw out a trespasser, while a trespasser is in process of trespassing and has not accomplished his possession, but this right is not available to the true owner once the trespasser has been successful in accomplishing his possession. In such circumstances law requires that the true owner should dispossess the trespasser by taking recourse to remedies available under law.
The Supreme Court in the case of Lallu Yashwant Singh (dead) by his legal representative Vs. Rao Jagdish Singh and others AIR 1968 629 while considering the tenancy laws as prevalent in the Gwalior State observed that even on the extinguishment of tenancy landlord has no right of re-entry on the land and the only remedy available to him is to approach the court for dispossession of tenant. A similar view was expressed by the Supreme Court in the case of Smt. Chander Kali Bail and others Vs. Jagdish Singh Thakur and another AIR 1977 SC 2262 while dealing with the matter under Madhya Pradesh Accommodation Control Act, 1961 and on the basis of the definition of the tenant contained therein observed that a tenant even after termination of his actual tenancy does not become unauthorised occupant of the accommodation but remains a tenant and such a person who continues in possession of the accommodation despite termination of his tenancy is entitled to protect his possession until and unless a decree for eviction is passed against him.
The Apex Court in Krishna Ram Mahale (dead) by his LRs. Vs. Mrs. Shobha Venkat Rao AIR 1989 SC 2097 held as under :
“It is well-settled law in this country that where a person is in settled possession of property, even on the assumption that he had no right to remain on the property, he cannot be dispossessed by the owner of the property except by recourse to law”.

The view expressed in all the above decisions has recently been summed up by the Supreme Court in (2003) 7 SCC 350 Ramesh Chand Ardawatiya Vs. Anil Panjwani in the following words.
“The person in possession may not have title to the property yet if he has been inducted into possession by the rightful owner and is in peaceful and settled possession of such property he is entitled in law to protect the possession until dispossessed by the process of law by a person having a title better than what he has. A person in possession of the property cannot be forcibly dispossessed by another rank trespasser and even if the latter does so, the former may be entitled to restoration of possession, because the law respects peaceful possession and frowns upon the person who takes the law into his own hands.”

Lastly, in a very recent decision reported in 2008 (II) RJ !256 Subramaniaswamy Temple, Ratnagiri Vs. V. Kanna Gounder (dead) by LRs. the Supreme Court dealing with the law in this connection quoted as under.
“8. It is thus clear that so far as the Indian law is concerned, the person in peaceful possession is entitled to retain his possession and in order to protect such possession he may even use reasonable force to keep out a trespasser. A rightful owner who has been wrongfully dispossessed of land may retake possession if he can do so peacefully and without the use of unreasonable force. If the trespasser is in settled possession of the property belonging to the rightful owner, the rightful owner shall have to take recourse to law; he cannot take the law in his own hands and evict the trespasser or interfere with his possession. The law will come to the aid of a person in peaceful and settled possession by injuncting even a rightful owner from using force or taking the law in his own hands, and also by restoring him in possession even from the the rightful owner (of course subject to the law of limitation), if the latter has dispossessed the prior possessor by use of force. In the absence of proof of better title, possession or prior peaceful settled possession is itself evidence of title. Law presumes the possession to go with the title unless rebutted. The owner of any property may prevent even by using reasonable force a trespasser from an attempted trespass, when it is in the process of being committed, or is of a flimsy character, or recurring, intermittent, stray or casual in nature, or has just been committed, while the rightful owner did not have enough time to have recourse to law. In the last of the cases, the possession of the trespasser, just entered into would not be called as one acquiesced to by the true owner.
9. It is the settled possession or effective possession of a person without title which would entitle him to protect his possession even as against the true owner. The concept of settled possession and the right of the possessor to protect his possession against the owner has come to be settled by a catena of decisions.”

A part from the above in a direct case dealing with a similar situation where a lease was granted by the State of U.P. was cancelled and the possession was sought to be resumed, it was held by the Supreme Court vide AIR 1989 SC 997 State of U.P. and others Vs. Maharaja Dharmander Prasad Singh etc. that the lessor has no right to resume possession from the lessee even after the expiry or termination of the lease by adopting extra judicial method. The Government can resume possession only in a manner known to or recognised by law.
Thus from the above discussion the law is clear and settled that a tenant even on the expiry/termination of lease cannot be thrown out of possession by the lessor not even if the lessor happens to be a Government unless proceedings are drawn for his eviction in accordance with law and a decree is obtained.
In view of the aforesaid facts and circumstances, the substantial question of law raised in this appeal is answered in favour of the plaintiff-appellant and it is held that even though the lease of the plaintiff-appellant stood terminated by efflux of time the defendant-respondents are not entitled to dispossess him without following the procedure as established by law which certainly has not been followed in the instant case.
Accordingly, the appeal succeeds and is allowed. The judgment and order of the lower appellate Court dated 17.9.1983 passed by the Additional Civil Judge, Bijnor in Civil Appeal No. 25 of 1983 (Uttar Pradesh Sarkar Vs. Chhuttan) is set aside and that of the Court of first instance is restored.
Dt. 15.7.09
S.S.

Interim Protection Not Barred Because Sec 5 Application Is Pending; Appellate Court May Preserve Efficacy of Appeal Without Adjudicating It on Merits

Neelabh Gupta Vs. Purshottam Das Gupta And 2 Others Allahabad High Court MATTERS UNDER ARTICLE 227 No. – 6301 of 2026 Interim Protection Not Barred Because Sec 5 Application Is Pending; Appellate Court May Preserve Efficacy of Appeal Without Adjudicating It on Merits

Validity of Power of Attorney After Death of Donor/Donee of Power

This is a general question that often arises in relation to the validity of a Power of Attorney. The question is whether Power of Attorney (POA) is valid after the death of person who executor/executant it, i.e., after the death of the donor/donee of POA. The answer to this question would depend upon the facts of each case. But, generally speaking, a Power of Attorney becomes invalid after the death of the donor / principal/donee/agent. However, if it is an irrevocable Power of Attorney, for valuable consideration, creating an agency wherein the donee / agent has an interest in the subject-matter property, then such Power of Attorney may be valid even after the death of the donor / principal.

Though the Powers of Attorney Act, 1882, defines what is “Power of Attorney”, it is merely an inclusive definition. Section 1A of the said Act says that “Powers-of-Attorney” include any instrument empowering a specified person to act for and in the name of the person executing it.

Basically, a POA holder is an “agent” of the person executing the POA, as defined under Section 182 of the Contract Act, 1872, which is reproduced as under: “182. “Agent” and “principal” defined.—An “agent” is a person employed to do any act for another, or to represent another in dealings with third persons. The person for whom such act is done, or who is so represented, is called the “principal”.”

Under Section 2 of the Powers of Attorney Act, the donee of a power-of-attorney is empowered to execute or do any instrument or thing in and with his own name and signature, and his own seal, where sealing is required, by authority of the donor of the power; and every instrument and thing so executed and done, shall be as effectual in law as if it had been executed or done by the donee of the power in the name, and with the signature and seal, of the donor thereof.

The POA holder has thus the power to affect the position of his principal by doing acts on his behalf.

While the Powers of Attorney Act is silent on the issue of termination of POA, the Contract Act has provisions with regard to termination of “agency”. Since POA is also basically an agency, the provisions of the Contract Act would be applicable to the termination of POA.

Section 201 of the Contract Act lays down how an agency can be terminated: “201. Termination of agency.—An agency is terminated by the principal revoking his authority; or by the agent renouncing the business of the agency; or by the business of the agency being completed; or by either the principal or agent dying or becoming of unsound mind; or by the principal being adjudicated an insolvent under the provisions of any Act for the time being in force for the relief of insolvent debtors.”

It should thus be clear that, generally speaking, an agency is terminated by the death of either the principal or the agent. Accordingly, generally speaking, a Power of Attorney is terminated by the death of either the donor of POA or of the donee of the POA.

However, Section 202 of the Contract Act lays down an exception to the above general rule of termination of agency:

“202. Termination of agency, where agent has an interest in subject-matter.—Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest.

Illustrations

(a) A gives authority to B to sell A’s land, and to pay himself, out of the proceeds, the debts due to him from A. A cannot revoke this authority, nor can it be terminated by his insanity or death.

(b) A consigns 1,000 bales of cotton to B, who has made advances to him on such cotton and desires B to sell the cotton, and to repay himself, out of the price, the amount of his own advances. A cannot revoke this authority, nor is it terminated by his insanity or death.”

Thus, where the agent himself has an interest in the property which forms the subject-matter of the agency, such agency cannot be terminated to the prejudice of such interest in the absence of an express contract. This situation will generally arise when the agent acquires such an interest in the subject-matter property for some valuable consideration paid or payable to the principal. In such situations, the agency may be irrevocable. However, if there is an express contract between the agent and the principal that even in such a situation, the agency may be terminated (subject to conditions, if any), in that case such agency may also be terminable.

Accordingly, if there is an irrevocable Power of Attorney (POA) creating an interest in favour of the donee  of the POA in respect of the property which forms the subject-matter of the POA, which is generally for some valuable consideration paid or payable to the donor of the POA, then such POA may not be terminated even after the death of the donor of POA and may continue to be valid. It may be binding on the heirs / successors of the donor of POA in these circumstances.

Barring the above exception, generally speaking, a POA gets terminated by the death of either the donor or of the donee of the POA.

 

Negotiable Instrument Act Ordinance 2015 is Retrospective

In the matter of M/S BRIDGESTONE INDIA PVT. LTD. Vs INDERPAL SINGH & Ors,Supreme Court has held that  Section 142(2)(a), of the Negotiable Instrument Act,1881  amended through the Negotiable Instruments (Amendment) Second Ordinance, 2015, vests jurisdiction for initiating proceedings for the offence under Section 138 of the Negotiable Instruments Act, inter alia in the territorial jurisdiction of the Court, where the cheque is delivered for collection (through an account of the branch of the bank where the payee or holder in due course maintains an account).

The facts of the case are that a cheuqe No.1950, drawn on the Union Bank of India,Chandigarh, was issued by Inderpal Singh to the M/s Bridgestone India Pvt.Ltd. The cheque was inthe sum of Rs.26,958/-. M/s Bridgestone India Pvt.Ltd. presented the above cheque at the IDBI Bank in Indore. Bridgestone India Pvt.Ltd.received intimation of its being dishonoured on account of “…exceeds arrangement…” on 04.08.2006 at Indore. Bridgestone India Pvt.Ltd.issued a legal notice on 26.08.2006, which was served on Inderpal Singh on 06.09.2006,demanding the amount depicted in the cheque. Bridgestone India Pvt.Ltd.informed Inderpal, that he would be compelled to initiate proceedings under Section 138 of the Negotiable Instruments Act, 1881, if payment was not made by the respondent within 15 days from the date of receipt of the legal notice. Consequent upon the issuance of the aforementioned legal notice wherein Inderpal was required to reimburse the cheuqe amount to Bridgestone India Pvt.Ltd., and Inderpal having failed to discharge his obligation, proceedings were initiated by Bridgestone India Pvt.Ltd.on 13.10.2006 in the Court of the Judicial Magistrate, First Class, Indore, under Section 138 of the Negotiable Instruments Act, 1881. Inderpal Singh, preferred an application before the Judicial Magistrate, First Class, Indore,Madhya Pradesh, under Section 177 of the Criminal Procedure Code,contesting the territorial jurisdiction with respect to the above cheque drawn on the Union Bank of India, Chandigarh. The prayer made by Inderpal, that the Judicial Magistrate, First Class,Indore, did not have the jurisdiction to entertain the proceedings initiated by the appellant – M/s Bridgestone Indian Pvt.Ltd. was declined on 02.06.2009. The Judicial Magistrate, First Class, Indore, relied on the judgment rendered by this Court in K.Bhaskaran vs. Sankaran Vaidhyan Balan and another, AIR 1999 SC 3762, to record a finding in favour of Inderpal. Dissatisfied with the order passed by the Judicial Magistrate, First Class,Indore, dated 02.06.2009,Inderpal Singh preferred a petition under Section 482 of the Criminal Procedure Code, in the High Court of Madhya Pradesh before its Indore Bench. Having examined the controversy in hand and keeping in mind the fact, that a number of documents were presented by Inderpal Singh during the course of hearing before the High Court, by an order dated 03.12.2009, the petition filed by the Inderpal was disposed of, by remitting the case to the Judicial Magistrate, First Class, Indore, requiring him to pass a fresh order after taking into consideration the additional documents relied upon, and the judgments cited before the High Court. The Judicial Magistrate, First Class, Indore, yet again,by an order dated 11.01.2010 held, that he had the territorial jurisdiction to adjudicate upon the controversy raised by the appellant – M/s Bridgestone India Pvt.Ltd. under Section 138 of the Negotiable Instruments Act, 1881. The decision rendered by the Judicial Magistrate, First Class, Indore, was again assailed by Inderpal in yet another petition filed by him under Section 482 of the Criminal Procedure Code, in the High Court of Madhya Pradesh before its Indore Bench. The High Court accepted the prayer made by Inderpal Singh by holding, that the jurisdiction lay only before the Court wherein the original drawee bank was located, namely, at Chandigarh, where-from Inderpal had issued the concerned cheque bearing No.1950, drawn on the Union Bank of India, Chandigarh.Dissatisfied with the order passed by the High Court of Madhya Pradesh, dated 05.05.2011, M/s Bridgestone India Pvt.Ltd. has approached this Court through the instant appeal.During the course of hearing, learned counsel for the appellant cited the decision rendered by a three-Judge Bench of this Court in Dashrath Rupsingh Rathod vs. State of Maharashtra and another, (2014) 9 SCC 129, and pointedly invited our attention to the conclusions drawn by this Court in paragraph 58, which is extracted hereunder:“58.To sum up:58.1 An offence under Section 138 of the Negotiable Instruments Act, 1881 is committed no sooner a cheque drawn by the accused on an account being maintained by him in a bank for discharge of debt/liability is returned unpaid for insufficiency of funds or for the reason that the amount exceeds the arrangement made with the bank.58.2 Cognizance of any such offence is however forbidden under Section 142 of the Act except upon a complaint in writing made by the payee or holder of the cheque in due course within a period of one month from the date the cause of action accrues to such payee or holder under clause (c) of proviso to Section 138.58.3The cause of action to file a complaint accrues to a complainant/payee/holder of a cheque in due course if(a) the dishonoured cheque is presented to the drawee bank within a period of six months from the date of its issue.(b) If the complainant has demanded payment of cheque amount within thirty days of receipt of information by him from the bank regarding the dishonour of the cheque, and (c) If the drawer has failed to pay the cheque amount within fifteen days of receipt of such notice.58.4.The facts constituting cause of action do not constitute the ingredients of the offence under Section 138 of the Act.58.5 The proviso to Section 138 simply postpones/defers institution of criminal proceedings and taking of cognizance by the court till such time cause of action in terms of clause (c) of proviso accrues to the complainant.58.6 Once the cause of action accrues to the complainant, the jurisdiction of the Court to try the case will be determined by reference to the place where the cheque is dishonoured.58.7The general rule stipulated under Section 177CrPC applies to cases under Section 138 of the Negotiable Instruments Act. Prosecution in such cases can, therefore, be launched against the drawer of the cheque only before the court within whose jurisdiction the dishonour takes place except in situations where the offence of dishonour of the cheque punishable under Section 138 is committed along with other offences in a single transaction within the meaning of Section 220(1) read with Section 184 of the Code of Criminal Procedure or is covered by the provisions of Section 182(1) read with Sections 184 and 220 thereof.” In view of the decision rendered by this Court in Dashrath Rupsingh Rathod’s case, it is apparent, that the impugned order dated 05.05.2011, passed by the High Court of Madhya Pradesh, Bench at Indore,  was wholly justified In order to overcome the legal position declared by this Court in Dashrath Rupsingh Rathod’s case, learned counsel for the appellant has drawn our attention to the Negotiable Instruments(Amendment) Second Ordinance, 2015 (hereinafter referred to as `the Ordinance’). A perusal of Section 1(2) thereof reveals, that the Ordinance would be deemed to have come into force with effect from 15.06.2015. It is therefore pointed out to us, that the Negotiable Instruments (Amendment) Second Ordinance, 2015 is in force. Our attention was then invited to Section 3 thereof, whereby, the original Section 142 of the Negotiable Instruments Act, 1881, came to be amended, and also, Section 4 thereof, whereby, Section 142A was inserted into the Negotiable Instruments Act. Sections 3 and 4 of the Negotiable Instruments (Amendment) Second Ordinance, 2015 are being extracted hereunder:“3. In the principal Act, section 142 shall be numbered as sub-section (1) thereof and after sub-section(1) as so numbered, the following sub-section shall be inserted, namely:-(2) The offence under section 138 shall be inquired into and tried only by a court within whose local jurisdiction,-(a) if the cheque is delivered for collection through an account, the branch of the bank where the payee or holder in due course, as the case may be, maintains the account, is situated;or (b) if the cheque is presented for payment by the payee or holder in due course otherwise through an account, the branch of the drawee bank where the drawer maintains the account, is situated.Explanation– For the purposes of clause(a), where a cheque is delivered for collection at any branch of the bank of the payee or holder in due course, then, the cheque shall be deemed to have been delivered to the branch of the bank in which the payee or holder in due course, as the case may be, maintains the account.”4. In the principal Act, after section 142, the following section shall be inserted, namely:-142A. (1)Notwithstanding anything contained in the Code of Criminal Procedure, 1973 or any judgment,decree, order or directions of any court, all cases transferred to the court having jurisdiction under sub-section (2) of section 142, as amended by the Negotiable  Instruments (Amendment) Ordinance, 2015, shall be deemed to have been transferred under this Ordinance, as if that sub-section had been in force at all material times.(2) Notwithstanding anything contained in sub-section (2) of section 142 or sub-section (1),where the payee or the holder in due course, as the case may be, has filed a complaint against the drawer of a cheque in the court having jurisdiction under sub-section (2) of section 142 or the case has been transferred to that court under sub-section (1), and such complaint is pending in that court, all subsequent complaints arising out of section 138 against the same drawer shall be filed before the same court irrespective of whether those cheques were delivered for collection or presented for payment within the territorial jurisdiction of that court.(3) If, on the date of the commencement of this Ordinance, more than one prosecution filed by the same payee or holder in due course, as the case may be, against the same drawer of cheques is pending before different courts, upon the said fact having been brought to the notice of the court, such court shall transfer the case to the court having jurisdiction under sub-section (2) of section 142,as amended by the Negotiable Instruments(Amendment) Ordinance, 2015, before which the first case was filed and is pending, as if that sub-section had been in force at all material times.”(Emphasis is ours)A perusal of the amended Section 142(2), extracted above, leaves no room for any doubt, specially in view of the explanation thereunder, that with reference to an offence under Section 138 of the Negotiable Instruments Act, 1881, the place where a cheque is delivered for collection i.e. the  branch of the bank of the payee or holder in due course, where the drawee maintains an account,would be determinative of the place of territorial jurisdiction.It is, however, imperative for the present controversy,that the appellant overcomes the legal position declared by this Court, as well as, the provisions of the Code of Criminal Procedure. Insofar as the instant aspect of the matter is concerned, a reference may be made to Section 4 of the Negotiable Instruments (Amendment) Second Ordinance, 2015, whereby Section 142A was inserted into the Negotiable Instruments Act. A perusal of Sub-section (1) thereof leaves no room for any doubt, that insofar as the offence under Section 138 of the Negotiable Instruments Act is concerned, on the issue of jurisdiction, the provisions of the Code of Criminal Procedure, 1973, would have to give way to the provisions of the instant enactment on account of the non-obstante clause in sub-section (1) of Section 142A. Likewise, any judgment, decree, order or direction issued by a Court would have no effect insofar as the territorial jurisdiction for initiating proceedings under Section 138 of the Negotiable Instruments Act is concerned. In the above view of the matter, we are satisfied, that the judgment rendered by this Court in Dashrath Rupsingh Rathod’s case would also not non-suit the appellant for the relief claimed.Supreme Court stated that it is in complete agreement with the contention advanced at the hands of the learned counsel for the appellant. Supreme Court stated that they are satisfied, that Section 142(2)(a), amended through the Negotiable Instruments (Amendment) Second Ordinance, 2015, vests jurisdiction for initiating proceedings for the offence under Section 138 of the Negotiable Instruments Act, inter alia in the territorial jurisdiction of the Court, where the cheque is delivered for collection (through an account of the branch of the bank where the payee or holder in due course maintains an account). Supreme Court also stated that based on Section 142A(1) to the effect, that the judgment rendered by this Court in Dashrath Rupsingh Rathod’s case,would not stand in the way of the appellant, insofar as the territorial jurisdiction for initiating proceedings emerging from the dishonor of the cheque in the present case arises. Since cheque No.1950, in the sum of Rs.26,958/-, drawn on the Union Bank of India, Chandigarh, dated 02.05.2006, was presented for encashment at the IDBI Bank, Indore, which intimated its dishonor to the appellant on 04.08.2006, we are of the view that the Judicial Magistrate, First Class, Indore, would have the territorial jurisdiction to take cognizance of the proceedings initiated by the appellant under Section 138 of the Negotiable Instruments Act, 1881, after the promulgation of the Negotiable Instruments (Amendment) Second Ordinance, 2015. The words “…as if that sub-section had been in force at all material times…”used with reference to Section 142(2), in Section 142A(1) gives retrospectivity to the provision.Supreme Court allowed the appeal and the impugned order passed by the High Court of Madhya Pradesh, by its Indore Bench, dated 05.05.2011,was set aside. The parties are directed to appear before the Judicial Magistrate, First Class, Indore, on 15.01.2016. In case the complaint filed by the Bridgestone India Private Limited has been returned, it shall be re-presented beforethe Judicial Magistrate, First Class, Indore, Madhya Pradesh, on the date of appearance indicated hereinabove.