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The Supreme Court of India, through its judgment dated 22.05.2026 in Mallika v. R. Nallathambi & Ors.1, held that a party claiming General Powers of Attorney (“GPA”) were executed merely as security for loan transactions and not for genuine sale transactions, bears the burden of proving such claim through cogent evidence, and that mere allegations of fraud or fiduciary misuse were insufficient to invalidate registered sale transactions in the absence of proof of fraud, misuse of authority or repayment of the alleged loans.
The Court held that unless foundational facts constituting fraud or fiduciary misuse were first established, the burden could not shift to the Respondents to prove the bona fides. It was also observed that the Appellant failed to produce documentary evidence of the alleged loans and their repayment, and had challenged the transactions after an unexplained delay of nearly ten years, during which the GPAs remained uncancelled and subsequent transactions continued without objection. Finding no perversity, patent illegality or substantial question of law, the Court dismissed the appeal.
Footnote
1. Civil Appeal No. 9837 of 2017.
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