The Madhya Pradesh High Court has clarified that a plaintiff seeking to invalidate a sale deed executed through a power of attorney cannot evade ad valorem court fees by claiming non-executant status. The ruling reinforces that until fraud in the power of attorney is judicially established, the plaintiff remains legally bound as the executant of the transaction.
Background & Facts
The Dispute
The petitioner, Ramsewak Patel, filed a civil suit seeking two declarations: first, that he is the lawful owner of the property in question; and second, that the power of attorney executed in favor of Defendant No.1 on 30.06.2014 was fraudulent, and consequently, the sale deed dated 11.11.2014 executed by Defendant No.1 in favor of Defendant No.2, pursuant to that power of attorney, is null and void and not binding upon him.
Key Facts
- The petitioner executed a power of attorney in favor of Defendant No.1 on 30.06.2014
- Defendant No.1, acting under the power of attorney, executed a sale deed in favor of Defendant No.2 on 11.11.2014
- The sale deed recorded a consideration amount of Rs. 12,50,000
- The petitioner alleges the power of attorney was obtained under false pretenses, purportedly for executing a different document
- No payment of consideration was made to the petitioner by Defendant No.1
- The petitioner has not sought cancellation of the power of attorney as a separate claim
Procedural History
- 30.06.2014: Power of attorney executed by petitioner in favor of Defendant No.1
- 11.11.2014: Sale deed executed by Defendant No.1 in favor of Defendant No.2
- 12.03.2026: Trial Court allowed application under Order 7 Rule 11 CPC, directing petitioner to value the suit at Rs. 12,50,000 and pay ad valorem court fees accordingly
- 16.04.2026: Petition filed before the Madhya Pradesh High Court challenging the trial court’s order
The Parties' Positions
Petitioner-Plaintiff: Argued that since the power of attorney was fraudulent, he was not the executant of the sale deed and therefore should not be required to pay court fees based on its valuation. He contended that the suit is for declaration of title and fraud, not for cancellation of the sale deed.
Respondents/State: Contended that the petitioner, as the principal who granted the power of attorney, remains the legal executant of the sale deed unless and until the power of attorney is declared fraudulent by a court. The valuation must therefore be based on the sale deed’s consideration.
Relief Sought
The petitioner sought quashing of the trial court’s order dated 12.03.2026 and direction to permit him to file the suit without paying ad valorem court fees based on the sale deed’s valuation.
The Legal Issue
The central question was whether a plaintiff who challenges the validity of a sale deed executed through a power of attorney may avoid paying ad valorem court fees based on the deed’s valuation by asserting that he is not the executant, pending a finding of fraud in the power of attorney.
Arguments Presented
For the Petitioner
The petitioner’s counsel relied on the principle that a person cannot be bound by an instrument procured through fraud. He argued that since the power of attorney was allegedly obtained by misrepresentation, the petitioner should not be treated as the executant of the sale deed. He cited Suhrid Singh v. Randhir Singh to argue that a suit for declaration of title does not require valuation based on the sale deed if the plaintiff is not the executant. He further contended that the suit is essentially for declaration of ownership and fraud, not for cancellation, and therefore, court fees should be based on the value of the declaratory relief sought.
For the Respondent/State
The State’s Public Prosecutor argued that under Order 7 Rule 11 CPC, the court must determine the correct valuation of the suit at the threshold stage. The petitioner, as the principal who granted the power of attorney, remains the legal executant of the sale deed unless the power of attorney is declared void. Until such a declaration is made, the sale deed stands as a valid instrument for valuation purposes. The court cannot assume fraud at the preliminary stage without evidence.
The Court's Analysis
The Court examined the nature of the petitioner’s claim and the legal consequences of granting a power of attorney. It emphasized that under Order 7 Rule 11 CPC, the court must determine the correct valuation of the suit based on the nature of the relief sought and the instruments involved.
"The sale deed having been executed by power of attorney holder of the petitioner, can be said to be executed by the petitioner himself."
The Court held that the petitioner cannot disclaim executant status merely by alleging fraud in the power of attorney without first obtaining a declaration that the power of attorney is fraudulent or void. At the preliminary stage, where no such declaration has been made, the law presumes the power of attorney to be valid unless proven otherwise.
"At this stage of the suit, where the declaration that power of attorney is a fraudulent document is yet to be given by the Trial Court, it cannot be said that the petitioner is not executant of the sale deed."
The Court further clarified that the petitioner’s remedy lies in proving fraud through evidence at trial, not in avoiding procedural obligations such as court fees. The burden of proving fraud rests on the petitioner, and until that burden is discharged, the sale deed remains the operative instrument for valuation.
The Court also distinguished between a suit for cancellation of a deed and a suit for declaration of title. While the latter may not always require valuation based on the deed’s consideration, when the title claim directly challenges the validity of a sale deed executed by the plaintiff’s agent, the valuation must reflect the transaction’s value.
The Verdict
The petition was dismissed. The Madhya Pradesh High Court upheld the trial court’s order dated 12.03.2026, directing the petitioner to value the suit at Rs. 12,50,000 and pay ad valorem court fees accordingly. The Court held that the petitioner remains the executant of the sale deed through his agent until the power of attorney is judicially declared fraudulent. No relief was granted.
What This Means For Similar Cases
Court Fees Cannot Be Evaded by Alleging Fraud Without Judicial Declaration
- Practitioners must advise clients that alleging fraud in a power of attorney does not automatically exempt them from paying ad valorem court fees based on the sale deed’s value
- The court will treat the principal as the executant unless and until the power of attorney is declared void by a competent court
- A separate suit for cancellation of the power of attorney may be necessary before challenging the sale deed’s valuation
Valuation at Threshold Stage Is Based on Alleged Instrument, Not Subjective Claim
- Under Order 7 Rule 11 CPC, courts must assess valuation based on the most plausible legal instrument in play, not on the plaintiff’s subjective assertion of non-executant status
- Even in fraud-based suits, the valuation must reflect the transaction’s monetary value unless the instrument is set aside
- This prevents plaintiffs from manipulating court fees by recharacterizing claims to avoid higher fees
Evidence of Fraud Must Be Led at Trial, Not at Pleading Stage
- Allegations of fraud are not sufficient to override procedural requirements; they must be substantiated through evidence
- Courts will not assume fraud at the threshold stage; the burden remains on the plaintiff to prove it
- This reinforces the principle that procedural compliance is non-negotiable, even in cases involving alleged illegality
