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Agency In Which Agent Has Interest Is Neither Terminated By Insanity Nor Death Of Principal Says Punjab & Haryana High Court

Sravika Reddy Kohir ,
  19 July 2022       Share Bookmark

Court :
Punjab & Haryana High Court
Brief :

Citation :
RSA-2819-2007(O&M)

CASE TITLE
Smt. Parkash Devi Vs Rajinder Kumar (Since Deceased) Through His LRS. And ORS.

DATE OF JUDGEMENT
July 05, 2022.

PARTIES
Appellant - Smt. Parkash Devi
Respondents - Rajinder Kumar (since deceased) through his LRS. And ORS.

BENCH
Justice. Anil Kshetarpal

SUBJECT

  • The Appeal has been filed by the appellant aggrieved by the trial court judgement as to the GPoA executed shall cease to exist with the death of the executant or the principal.

IMPORTANT PROVISIONS

SECTION 202 OF INDIAN CONTRACT ACT 1872

  • This section deals with the termination of agency, where the agent has interest in the subject matter. The sections states that in the absence of an express contract the agency cannot be terminated as to the prejudice of such interest.

ISSUES RAISED

  • Whether on the death of the principal, the executed GPoA, agreement to sell and other power of attorney will cease to be effective?

OVERVIEW

  • The respondent filed a suit for possession by ejecting the defendant from his shop claiming that the tenancy has been terminated. The same was opposed stating that the appellant was having ownership with regard to the same property in reference to the GPoA registered and executed by the late father of the respondent which then resulted in transferring the same to appellant by her husband. Thus, the same transfer was held not valid and that the GPoA executed ceases with the death of the person executing or the principal and thus leading to questioning the validity of the sale deed. The same was also held in the First Appellate Court.
  • The same is questioned in this Regular Second Appeal in front of the High Court by the Appellant.

ARGUMENTS ADVANCED BY THE APPELLANT

  • The counsel for the appellant relied upon the section 202 of the Indian Contract Act 1872, and submitted that if any agent has an interest in the subject matter of agency the same cannot be terminated in the absence of an expressed contract with regard to the same.
  • He further contended that the appellant’s husband has paid the full sale consideration with an interest in procuring the subject matter and for the same GPoA was executed by the respondent’s father.
  • The counsel further relied upon the judgement made in Maharani Shanta Devi (her highness) Vs. Shavjibhai H. Patel and others [1998(4) Civil Law Journal 252 = (1998) 2 Gujarat Law Reporter 1521] held that death of the principal does not make any effect upon the termination of the agency.
  • The counsel further contended that there was no mandatory provision as to the attestment of the GPoA or SPoA, the same documents were genuinely executed and registered. They have also been proved by the statements given by sub registrar who has given the original record and also proved the documents.
  • And thus, the onus to prove the above documents were never executed would shift on to the respondent.

ARGUMENTS ADVANCED BY THE RESPONDENTS

  • The counsel for the respondent argued that the agreement of sale was completely registrable under the sections 17(b) and 17(c) of the Registration Act, 1908.
  • The counsel further contended that the same agreement to sell was not admissible as evidence to prove the signatures as the same was not duly stamped under the Indian Stamps Act, 1899.
  • The counsel further argues as to there existed no explanation with respect to the transferring the will property to the appellant by a registered sale deed.

JUDGEMENT ANALYSIS

  • The bench analysing the both the contentions of the dispute has concluded that the respondents’ arguments were vague and did not have supporting evidences. The appellants with regard to the provisions of section 202 of the Indian Contract Act have the right to ownership with regard to the property and agency shall not be terminated merely on the basis of insanity or death of the principal.
  • The court held that the judgement and decree passed by both the lower courts are set aside and the appeal by the appellant shall be allowed.

CONCLUSION

  • Thus, it is stated with reference to the illustration (b) of the section 202 of Indian Contract Act 1872, that the termination of the agency cannot be determined based upon the insanity and death of the principal there must exist an expressed contract that holds the same.

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