The Supreme Court has observed that sale transactions carried out on the basis of a valid Power of Attorney (PoA) cannot be sought to be set aside later on the ground that the PoA was cancelled subsequently.
Holding so, the Court affirmed an order of the Trial Court rejecting a plaint, which sought to annul certain past sale transactions on the basis of the subsequent cancellation of the PoA.
The PoA was executed by the plaintiff in the name of the first respondent on 15.10.2004. In 2018, the plaintiff filed a suit seeking to annul certain sale transactions carried out between 2004-2006 and in 2009. The plaintiff claimed that he got knowledge about the sale transactions only on 21.09.2015 and the suit was filed within the three-year limitation period from such date. The power of attorney was cancelled on 22.09.2015.
"We are clear in our minds that the cancellation does not affect the prior conveyances made which are clearly on the strength of the power conferred on the appellant. There is no contention raised as to the power of attorney having not conferred the power to enter into conveyances or that such power of attorney was executed by reason of a fraud or coercion employed on the executant. The power holder having exercised the authority conferred; to convey the properties in the name of the purchasers, the cancellation of the power of attorney will have no effect on the conveyances carried out under the valid power conferred. Nor would it confer the person who executed the power of attorney any cause of action, by virtue of a cancellation of the power conferred by a subsequent document, to challenge the valid exercise of the power when it existed."
V Ravikumar v S Kumar