A Power Of Attorney is a legal document authorizing the POA Holder to act on behalf of the Principal. A POA should be registered at the Office of the Sub-Registrar along with 2 attesting witnesses. Generally, documents such Passport, AADHAR Card, passport size pictures, etc. of both the parties is required for registration.
Thu Jun 23 2022 | HLL Knowledge Series | Comments (0)
A Power of Attorney is a document authorizing an individual to act legally on one’s behalf. Hence, through a Power of Attorney (POA), any person known as the Principal, can authorize an individual known as the POA Holder/Agent to perform certain legal/ financial and other related acts and transactions as authorized by him due to the Principal’s inability to perform the same by himself due to certain circumstances. Although it is not mandatory to register a POA in India. However, it is always advisable to get the same registered in order to increase its authenticity. Based on the type of POA executed between the parties, the Principal can either delegate exclusive or extensive responsibilities and tasks.
A power of attorney is a collection of powers/responsibilities listed out in one instrument that allows a Principal to act through a third party, under a contractual capacity, in order to execute a legal or financial decision/s. It is a sort of agreement that not only evidences a POA Holder’s appointment but also sets out the nature, limit and extent of his/her authority. The legally appointed POA Holder’s role and responsibility is limited to specific circumstances and limited to a period.
The duties and responsibilities of the POA Holder as to the Principal, are determined by the express and implied provisions of the agreement entered between the two. The POA Holder must be selected wisely and with precision, since the person acts on your behalf, i.e the Principal. Hence, he should be selected based on his knowledge, skills, ability, and integrity.
A General Power of Attorney (GPA) is a form of POA where the POA Holder is trusted with the general authority given to him by the Principal. Hence, through this form of power of attorney, the POA Holder is entrusted with an extensive form of authority to act on his behalf in various transactions related to property buying and selling, finance, taxation, complete property management, etc. It is mostly opted by individuals where the Principal resides in another country and needs a POA Holder to act on his behalf.
A Special Power of Attorney also known as a limited power of attorney, is a type of POA, where exclusive authority and responsibility is given to the SPA Holder, which is limited to a specified area or a specific transaction. The SPA Holder can strictly act within the boundaries as described by the Principal.
Even though it is not mandatory to register a power of attorney in India, it is advisable to get the POA registered in order to increase the authenticity of the document. Further, if a POA is executed in respect of an immovable property of more than INR 100 in value, then it must be necessarily registered.
A POA is registered in India at the office of the Sub-Registrar of the appropriate jurisdiction. An appropriately drafted POA must be presented on a stamp paper of appropriate value.
The POA should be presented at the office of the Sub-registrar along with original documents with copies showing proof of ownership, proof of residence and proof of identity. Two witnesses are also required, who should also have proper identification proofs. The type of POA should be consciously chosen to avoid any uncertainties in the future. Details such as Full name, address, Passport details, AADHAAR Card details of both- the principal and the POA Holder- must be incorporated in the document along with the specific authorities or extensive authorities that are being delegated.
Stamp duty of the requisite amount must be paid, which will depend on the laws and requirements of each state.
Generally required documents for said purpose-
A POA is generally used by NRIs for selling/acquiring properties in India. The POA executed outside India should be authenticated by the Indian Consulate / Embassy or Notary Public. In some countries, witnesses might be required at the embassy, however, in some, this requirement is not mandatory. The POA should be then sent to India by post. In some states in India, the POA executed outside is adjudicated at the Office of Additional Collector, and in some states, it is registered at the sub-registrar office.
To conclude, a POA should be appointed with great caution. Under various circumstances, the POA Holder is mandated to handle binding contracts, possess money and other transactions on behalf of the Principal, and hence the POA Holder must be honest and there should be fiduciary relationship between the POA Holder and the Principal. Further, Registration of the POA should be mandatorily done when the POA is executed outside India.
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