A Registered Sale Deed Is Not Sacrosanct When It's Born in Fraud: Madras High Court Voids Transaction Based on Sham Power of Attorney Deal

"Court Cannot Grant Relief Not Prayed For – Judex Ne Eat Ultra Petita Is Not Mere Latin, It's Law", In a compelling judgment that cuts through layers of documentary formality to unveil a fraud cloaked in legal robes, the Madras High Court held that a registered sale deed executed by a power agent is invalid when it arises from collusion, misuse of authority, and absence of consideration. Dr. Justice A.D. Maria Clete affirmed the trial court’s decision declaring the sale deed and related sale agreement as null and void, but set aside its unwarranted direction to the plaintiff to repay Rs.5,00,000, observing that "no relief can be granted to a party who never prayed for it, pleaded it, or proved it."

The case turned on a common but legally complex situation: whether a loan transaction disguised as a property sale through power of attorney could stand the scrutiny of law. The High Court held that it could not, making it clear that “registration does not cleanse a transaction of its fraudulent character.”

The judgment, rich in legal nuance and grounded in equity, sends a strong message against attempts to subvert ownership through manipulative documentation.

“A Life Certificate and a Power of Attorney Cannot Replace the Owner’s Consent”: Court Calls Out the Farce of Fabricated Sale

The plaintiff, Jayalakshmi, an illiterate woman grieving the recent loss of her son, approached the second defendant, a close relative, for a loan of Rs.5,00,000 during a time of financial and emotional distress. As security, she executed a power of attorney and a sale agreement in June 2013. On 4th October 2013, without her knowledge, the second defendant cancelled the sale agreement and used the power of attorney to execute a sale deed in favour of the third defendant. On the same day, the third defendant entered into another registered sale agreement with the first defendant, who never examined himself in court.

The Court found the flurry of registrations, all executed on the same day and involving interrelated parties, to be suspect.

"The presence of a life certificate to show that the plaintiff was alive, when the plaintiff was allegedly present at the registration office herself, is not just suspicious—it’s absurd," the Court remarked.

Though the sale consideration was shown as Rs.15,52,000, the receipt for payment (Ex.B5) was undated, filled partly in ink, and bore no contemporaneous evidence of actual payment. The plaintiff never signed the registered sale deed. Her husband, an attesting witness, testified that his signature was obtained under concealment. The Court found this explanation plausible, especially considering that the receipt's contents were typed with blank spaces later filled in ink.

"When a document purporting to record a sale consideration is manipulated, unsigned by the seller, and filled post-registration, the presumption of a valid transaction is displaced," the Court observed.

“The Plaintiff’s Title Remains Intact – Possession Follows Title When Deed Is Void”: High Court Restores Ownership and Possession

Addressing the question of possession, the Court applied a well-settled principle.

“In the case of a vacant site, possession follows title. Once the sale deed is declared void, the plaintiff, as the lawful owner, is deemed to be in possession,” the Court said, rejecting the third defendant’s claim to ownership and occupancy based on a transaction it called “shrouded in suspicious circumstances.”

The sale agreement (Ex.A6), entered into between the first and third defendants and also dated 04.10.2013, was dismissed as sham. Though the written statement alleged that Rs.5,00,000 had been advanced under it, the document itself reflected only Rs.50,000 as advance. The Court found the defendants’ case to be internally contradictory.

“When pleadings and documents are mutually destructive, the Court cannot place its faith in either,” Justice Clete observed.

The sale agreement, notably, was cancelled during the pendency of the suit—further bolstering the plaintiff’s case.

“A Court Is Not a Benevolent Accountant to Award Relief That Was Never Sought”: Trial Court’s Unsolicited Money Decree Quashed

Where the trial court faltered, the High Court did not hesitate to set things right. Despite the plaintiff alone pleading that Rs.5,00,000 was advanced as a loan, and in the absence of any counter-claim or pleading from the second defendant, the trial court passed a money decree suo motu in the second defendant’s favour, directing the plaintiff to repay the said sum with interest.

The High Court was unequivocal in its censure.

"Judex ne eat ultra petita is not a ceremonial principle—it is a constitutional safeguard against judicial overreach. The Court cannot grant a relief to a party that neither sought it nor paid court fee for it," the Court held, setting aside the decree as one passed in excess of jurisdiction.

Further, the Court clarified that Section 151 CPC, which confers inherent powers on civil courts, cannot be used to bypass statutory requirements such as pleadings, court fees, and procedural fairness.

"The power to mould relief is not an invitation to legislate from the bench," the Court remarked.

A Word to the Wise: Loan Transactions Dressed as Sales Can Collapse Under Judicial Scrutiny

The decision stands as a caution to those who attempt to camouflage loans as sales, using powers of attorney to orchestrate property transfers without the owner's full knowledge or consent. The High Court’s refusal to be misled by registered documents and life certificates reinforces the principle that substance prevails over form.

In the end, justice was served: the plaintiff retained her property, the so-called sale was annulled, and the defendants left the courtroom without title, possession, or money relief.

Date of Decision: 2 January 2026