According to section 17 of the Indian Registration Act, 1908 registration of documents is compulsory if they relate to an immovable property. Similarly, Section 54 of Transfer of Property Act 1882, stipulates that sale of immovable property the value of which is one hundred rupees or more should be registered. Since no immovable property is available for rupees one hundred or less than rupees one hundred, implicitly all sale deeds of immovable property need compulsory registration.
Compulsorily registrable Documents:
Section 17(1) of Indian Registration Act 1902, deals with the documents which require registration compulsorily. They include:
1. Instruments of gift of immovable property:
Gift is given by the donor to the donee without any monetary consideration, but only in consideration of love and affection the donor has towards the donee. Therefore, gift deeds transferring immovable property of the value of mRs.100/- and above needs registration.
2. Other non-testamentary documents which purport to create, assign, limit or extinguish the right, title and interest in immovable property the value of which is more than one hundred rupees.
3. All non-testamentary documents which acknowledge the receipt or payment of any consideration on account of the transactions pertaining to the creation of any right, title, interest in the immovable property.
4. All non-testamentary documents transferring or assigning any decree or order, award of a court, which affect the right, title and interest in immovable property the value of which is one hundred rupees and above.
The documents may create, extinguish, assign, declare, limit or restrict the right, title and interest in the immovable property for the present or future, but if the value of such immovable property is one hundred rupees or more, the deed needs to be registered.
Though all types of mortgages need registration, mortgage created by depositing of title deeds, known as equitable mortgage, is not compulsorily registrable. Mostly, banks and financial institutions use this mode of mortgage. However, memorandum of deposit of title deed needs registration.
Section 107 of Transfer of Property Act 1882, prescribes that lease of immovable property from “year to year” or for any term exceeding one year or reserving a yearly rent must be done only by a registered instrument. The phrase from ‘year to year’, refers to a continuous lease from year to year, that is, where the landlord has no option to terminate the lease at the end of the year without notice.
Similarly the phrase, “reserving yearly rents” means that the lease has no definite period, but the annual rent is determined. The word “yearly” means that the lease should run year after year or at least more than a year. In general, any lease in excess of one year and above should be registered.
Documents where registration is optional:
There are certain documents registration of which is optional. Section 18 of the Indian Registration Act, 1908 lays down the instruments of which registration is optional. They include:
a] Instruments relating to transfer of an immovable property, the value of which is less than rupees one hundred;
b] Lease of an immovable property for a term not exceeding one year;
c] Wills
d] Deed of gift of property valued at less than Rs.100/-
Time limit for registration:
Under Section 23 of the Registration Act, subject to certain exceptions, any document other than a will has to be presented for registration within four months from the date of its execution. Execution means signing of the document. If a document is not presented for registration within the prescribed period of four months and the delay in presentation of the document does not exceed a further period of four months, then the parties can apply to the Registrar for registration of the document who may direct, upon payment of a fine not exceeding ten times the actual registration fees, for registration of such a document [Sec.25].
A document relating to an immovable property can be executed out of India and later it can be presented for registration in India. As per section 26 of the Registration Act, 1908, if a document purporting to have been executed by all or any of the parties out of India is presented for registration within the prescribed period of time, the Registering Officer may, on payment of proper registration fee accept such document for registration if he is satisfied that the instrument was executed out of India and the instrument has been presented for registration within four months after its arrival in India.
Enquiry by the Registering authority:
The Registering Officer is empowered under sec. 34 of the Registration Act to enquire whether or not the person is the same by whom it purports to have been executed such a document. He may insist on production of proof for his identity and in case any person is appearing as a representative or agent, the Registrar may ask for relevant documents to show that the agent or representative has the right to appear on behalf of his principal.
Effect of non-registration:
What would be the repercussion if a document which is compulsorily registrable is not registered?
Section 49 of Indian Registration Act deals with this situation. It states clearly that such un-registered documents do not convey to the transferee a legally valid title and such documents are not admitted as evidence for any transaction affecting the property referred to in the document. However, there is an exception provided in the Act. The unregistered documents may be admitted as evidence in a suit for specific performance under Specific Relief Act or as evidence for part performance of the contract as per Section 53A of Transfer of Property Act 1882 or in any other related transaction, not required to be effected under a registered instrument.
Documents are mainly registered for conservation of evidence, assurance of title, and to help an intending purchaser to know if the title deeds of a particular property have been deposited with any financial institution or person for purpose of obtaining loan or advance against security of the property. Registration of documents acts as notice to the public and to protect oneself against the likely fraud. Therefore, it is advisable to register all documents connected with the immovable property irrespective of whether the registration is compulsory or not as it creates a permanent record of event which are reflected in encumbrance certificates.
As registered documents have higher value of evidence than unregistered documents it is always beneficial to you if you get all your property documents registered within the stipulated period irrespective of the fact that such registration is mandatory or not.
REQUIREMENTS FOR REGISTRATION
Most of the instruments viz. creating, declaring, assigning, limiting or extinguishing any right, title or interest in immovable property require compulsory registration, as enumerated under the Indian Registration Act, 1908.
For the documents which require mandatory registration certain procedures are prescribed in the Statute. They are briefly discussed as under:-
Generally, documents will be drafted in the local language or in English. If the document is in a language which the Registering authority has no knowledge or does not understand, then the document has to be translated into the language known to the Registering Authority.
After the translation, if any inter lineations, blanks, erasures and alterations are found in the document, the authority may ask for attestation of the same.
Further, it is also necessary that description of the property has to be clearly mentioned for identification of the property and to ascertain the actual location where the property is situated. If necessary, it may require production of map or plan.
Time limit
In certain deeds, date of execution and date of registration may vary. This is because the Act stipulates time limit for registration of the documents. For the non-testamentary documents such as Sale Deed, Gift Deed, Mortgage Deed, etc, the time limit within which the document has to be registered is four months from the date of execution. Orders passed by the Court do not require registration. Decrees drawn in terms of Compromise Petition wherein shares of the parties are allotted by metes and bounds require registration. Even for registration of the court decree, four months time limit is stipulated under the Act. If the document is executed by all or any of the parties residing abroad, the same can be accepted for registration within four months from the date of receipt of the document in India.
However, in case of doubt as to the validity of registration, the document may be re-registered within four months from the date when it is noticed that the registration is invalid or of doubtful validity.
In case of Testamentary instrument, that is, Will, registration is optional and time limit is not prescribed. It can be registered any time before the death of the Testator. However, it is advisable to register the same as soon as possible in order to avoid disputes about the genuineness of its execution.
Where a document is executed by several persons at different times, it should be presented within four months from the date of the latest execution for registration.
If for unavoidable reasons, the document could not be presented for registration within four months from the date of execution, registration can be done on payment of fine prescribed under the Act, which will be up to ten times the amount to be paid as registration fee.
Jurisdictional Sub-Registrar Offices:
Generally documents have to be presented for registration only at the Sub-Registrar’s office within whose jurisdiction the immovable property is situated. However, in certain exceptional cases, documents may be presented for registration with the Registrar who has been conferred with the power to register the documents. In fact, Sub-Registrars have been vested with the special power to register the document at the residence or office of the Executant or to accept deposit of Will.
Presentation of the document :
Documents which require mandatory registration has to be presented in the concerned Sub-Registrar Office for registration by the Executant or person claiming under the Decree. However, in certain cases, the representatives of the Executant, duly authorized under Power of Attorney, can also execute the same on behalf of the Executant. A power of Attorney holder can execute the document, representing the Principal only if an authority has been vested in the Agent under Power of Attorney, which is authenticated by the Registering authority within whose jurisdiction the Principal resides.
If the Principal does not reside in India, then the Power of Attorney should be executed before and authenticated by a Notary Public or any Court, Judge, Magistrate, Indian Consul or Vice-Consul or the Representative of Central Government. However, such an execution of Power of Attorney can be proved by producing the same at the concerned Sub-Registrar’s Office.
When a document has been executed by more than one executant and after execution of the same, one of the executants refrain from attending the concerned Sub-Registrar’s Office for registration, then the remaining executants can compel attendance of the executant reluctant to be present before the registering authority through the process of law.
However, in case of registration of Will, the same may be presented by the Testator and after his death, by the Executor, for registration.
A Will may be deposited with the Sub-Registrar in a sealed cover and such deposit may be done through an agent. After the death of the Testator, the sealed envelope will be opened and the contents recorded in the relevant register maintained in the Sub-Registrar’s Office. The Original copy of the 'Will' will be in the custody of the Sub-Registrar.
Effect of Registration
Any instrument of transfer registered in the concerned Sub-Registrar’s office will be considered as a valid transfer under the Act. The document shall operate from the time stipulated in the instrument and not from the date of registration.
Generally, a written document will prevail over the oral agreement, unless the physical or constructive possession of the property is handed over to the Agreement-Holder. In such a case, subsequent written agreement will not override the oral agreement.
Documents which are not registered, apart from illegality as to the transfer, cannot be produced as evidence in any transaction affecting such property.
An exception to this is the Agreement of Sale which does not require registration but can be produced in a suit for specific performance seeking execution of sale deed.
Endorsement :
After accepting the document for registration, the Registering authority shall endorse the document regarding affixation of the signature of the Executant, payment of consideration, date and other relevant particulars. If registration is declined by either of the party, the same shall be endorsed on the document itself.
Apart from this, the Registering authority shall also endorse on the Document the registration number, Book number, pages, volume or CD number and affix the seal of the office of the Sub-Registrar. Such a Certificate shall be copied in the Register meant for the purpose and copy of the map or plan, if any, shall be filed in Book No.1.
Thereafter, the registered document will be returned to the person who has presented the same for registration or to his representatives.
Fees of Registration:
Fees charged for the registration or searching the register are prescribed by State Governments through Notifications.
For executing an instrument, the first and the foremost aspect to be considered is the nature of the right intended to be transferred.
If the document falls within the category of the documents which warrants compulsory registration, any avoidance of registration of such document would invalidate the document itself.
POWER OF ATTORNEY
Power of Attorney means the power or authority given to a person (agent) by an individual (principal) to act on his behalf or on behalf of a group of individuals in business matters or any other matter.
It plays a vital role in transferring the lawful ownership of immovable property like land, building and water source, from one person to another. The person who holds the power is called the Power of Attorney Holder. He is employed by the principal to take care of his dealings with third persons.
A person competent to contract can execute a Power of Attorney. He can appoint one person or several persons to act on his behalf. Where several persons are appointed as attorneys, it is advisable to mention as to how they will act jointly or independently. If this is not mentioned, then they are at liberty to act jointly.
Power of Attorney, generally speaking, is of two types. Power of Attorney for a single specific purpose is known as “Special Power of Attorney” and the one involving more than one work or transaction is called “General Power of Attorney”.
The duration of special power of attorney may be for a particular period or for an indefinite period until the task is completed.
A General Power of Attorney may continue to be in force until it is revoked or by death of either party. A registered Power of Attorney can be revoked by a Cancellation Deed.
Though, in general, a Power of Attorney is revocable, it cannot be done so in matters pertaining to debt security till the debt is cleared even though the debtor is not alive. It can be revoked if the principal becomes of unsound mind or he is declared insolvent. It cannot be revoked if it is made irrevocable. However it should be registered by paying applicable stamp duty. Power of Attorney attracts various provisions of The India Stamp Act, Powers of Attorney Act, Registration Act, The Indian Contract Act, Indian partnership Act, and the Indian Evidence Act.
A Power of Attorney is divided into ten categories according to the stamp duty payable. A Special Power of Attorney is given for a court case, for appointing one attorney in place of another, for collection of debts and for admitting execution and a General Power of Attorney is given for selling shares, to execute a Sale Deed, to prepare a layout and sell plots, to raise money through mortgage of property, to recover rents and many other acts.
A Power of Attorney need not be registered except in the case where immovable property is involved. According to the Registration Act, if a Power of Attorney gives power to present documents for registration, then it must be executed before and authenticated by the Registrar or the Sub-Registrar.
If the Registration Act is not in force at a place where the Executant lives, then a Magistrate’s authentication is necessary.
If the Power of Attorney is registered outside India a Notary Public and Court Judge, Magistrate of that country, or Indian Consul or Vice-Consul or a representative of Central Government must authenticate it.
A Power of Attorney is executed in the form of a legal document generally in first person and begins either as “Know all men by these presents that I …….” or “By the power of attorney I ……….. or “This Power of Attorney made and executed on this……………….”
After a brief introduction, the operative part is brought in. Thereafter, the specific powers given to the person are mentioned in separate paragraphs. After these a general clause is added empowering the attorney to do such lawful acts and deeds, as he deems fit and proper in the performance of his duties.
It is the duty of the agent, the Power of Attorney holder, to act honestly and faithfully on behalf of his principal, the giver. He is legally bound to perform the tasks according to the wishes of the principal. If the agent acts otherwise and the principal suffers any loss, he must compensate the principal. He is bound to keep all accounts in a proper manner and produce it to the principal on demand. An agent possessing authority to carry on business has authority to do every lawful thing necessary for the purpose. Being a legal document, a Power of Attorney must be strictly interpreted and understood. Therefore, special care must be taken while drafting General Power of Attorney.
TERMINATION OF GENERAL POWER OF ATTORNEY
A person may not be able to be personally present to execute any document, due to various reasons such as living in a foreign country, old age, sickness, weak or otherwise busy. In such circumstances, the owner of the property may entrust the job of maintaining and managing the property in his absence, to any third person through a G.P.A. He may also authorize the GPA Holder to negotiate for sale of the property on his behalf. Such an instrument empowering a third person to perform certain general or specific acts in his absence is termed as General Power of Attorney.
Types of Power of Attorney:
There are two types of Power of Attorney. They are: General Power of Attorney & Special Power of Attorney.
General Power of Attorney is given in the circumstances where the Principal, that is, the person who executes the General Power of Attorney authorizes his Agent, the GPA Holder, to undertake all the acts which are necessary in order to accomplish the object for which power of attorney is executed.
Special Power of Attorney is executed in those cases wherein the agent is empowered by his principal to do such acts specified in such Power of Attorney. In this type of power of attorney, the authority to do specified acts will be revoked soon after that particular act is accomplished.
Revocation of Power of Attorney:
The Principal has got every right to revoke, terminate or cancel the Power of Attorney. The following are few of the circumstance wherein the power of attorney can be revoked:
1. If one of the parties to the Power of Attorney viz., the Principal or his G.P.A. holder dies, then the Power of Attorney will be revoked. Thus, if Power of Attorney is executed for presentation of a document in the Sub-Registrar office by the G.P.A. holder and the Principal dies prior to the presentation of the document, then the of Power of Attorney automatically gets revoked. But, if the Agent transacts the business on behalf of the Principal and the Principal dies after the execution of the same, the legality of document executed on behalf of the Principal is not affected. However, all further transactions by the Agent representing the Principal would be null and void;
2. If the Power of Attorney is given for a particular period, on the expiry of the period stipulated in the instrument;
3. Where the Principal is adjudicated as an Insolvent by the Court of Law;
4. If the business of agency is complete for which the Power of Attorney is executed;
5. The Power of Attorney holder renounces his powers;
6. The Principal revokes the authority of the Power of Attorney Holder;
7. When either of the parties to the instrument would become persons of unsound mind.
8. Implied revocation.
Procedure for termination of Power of Attorney:
Power of Attorney can be revocable or irrevocable. However, in either case, there is a specific procedure to be followed in order to terminate the Power of Attorney.
Registered Power of Attorney:
In case the Power of Attorney is registered, the revocation can be brought about only by a registered deed of revocation, the reason being that any registered document can be cancelled or revoked only by executing a registered instrument.
Unregistered Power of Attorney:
Power of Attorney need not compulsorily be registered. In case the Power of Attorney is unregistered, revocation of the same can be done only by an unregistered instrument of revocation, in which case the Principal can take back the Power of Attorney from the agent through an unregistered instrument of revocation. Apart from an unregistered instrument of revocation, it is also necessary that the fact of revocation has to be published in the local newspapers clearly mentioning the fact of revocation of the said Power of Attorney which operates as the notice to the public. This is necessary because registered instrument operates as notice while unregistered document does not.
Power of Attorney executed jointly:
Where several persons execute Power of Attorney jointly appointing a person as their Power of Attorney Holder/Agent, the act of revocation of Power of Attorney by one of the Principals is void in the absence of the consent of others joint principals. However, if the Power of Attorney is executed jointly and severally, revocation by one Principal is sufficient for termination of the same. On the other hand, if Power of Attorney is executed in favor of two persons jointly and if one of them dies, the survivor alone cannot exercise the authority under the Power of Attorney.
Notice:
A reasonable notice must be given before revocation of Power of Attorney for the reason that both the parties must be aware about the subsistence or otherwise of the Power of Attorney. If the party who revokes the Power of Attorney fails to issue notice to the other party then any damage that may subsequently be caused on account of this will have to be made good by the person who failed to give notice.
However, reasonable notice may differ from one instrument to the other which can be ascertained from the recitals in the instrument.
Revocation of Power of Attorney may be implied or express. If it is expressed, necessary notice has to be given conveying the intention of revocation of the Power of Attorney to the other which may not be necessary if it is implied.
Exceptions for revocation of Power of Attorney:
Though Principal has got discretionary powers to revoke the Power of Attorney, there are certain exceptions which restrain the Principal from revocation, which are explained below:
1. When the Power of Attorney Holder himself has an interest in the property, which forms the subject matter of the power of attorney. In such cases, the same cannot be revoked by the Principal alone without obtaining consent from the Power of Attorney Holder.
2. When the Power of Attorney Holder has partly exercised the act for which the Principal has authorized, authority as regards the acts already exercised cannot be revoked.
3. When the Power of attorney is given for due consideration and forms part of the transaction.
Power of Attorney by Firm:
The execution of Power of Attorney by a Firm for exercising certain acts on behalf of the firm, which includes purchase or sale of the immovable property, would get terminated on the dissolution of partnership firm.
Two persons appointed jointly:
If the authority is given for two or more persons to act jointly or severally, exercise of the act by either of the Power of Attorney Holders is sufficient. However, in cases where authority is given for two or more persons to act jointly and on the death of one of them, the authority cannot be acted upon by the surviving power of authority holders.
Power of Attorney is the most extensively used document being executed by the owner due to his inability to perform many acts. However, the required procedure also has to be followed for termination of the same. Thus, before proceeding to negotiate for sale or purchase of the property and if either of the parties for the negotiations are being represented by their GPA holder it is very important to investigate the subsistence of the GPA which depends upon various factors.
G P A FOR PROPERTY TRANSACTIONS
Power of Attorney is one of the documents which is being executed most extensively pertaining to the transactions involving transfer of properties, irrespective of modes of conveyance. The main reason being inability of the person, either the transferee or the transferor to be present at different place at the same time. In order to complete such transactions, in his/her absence, General Power of Attorney is executed, authorizing another person to do acts or certain acts on his/her behalf. Such an instrument empowering a specified person to perform such act in his absence is termed as General Power of Attorney, as envisaged in the Power of Attorney Act 1882.
The instrument of Power of Attorney is based on the concept of Law of Agency, wherein the Principal, i.e., the person who executes Power of Attorney, authorizes his Agent, i.e., the person in whose favor such Power of Attorney is executed, to do all such necessary acts specified in the Power of Attorney on his behalf and further ratifies such acts of the Agent and the said concept has been recognized under the statute thereby giving legal sanctity.
Competency of the Parties:
The following are the mandatory requirements before executing Power of Attorney:
Majors: It is necessary that both the Principal and the Agent must have attained the age of majority because contract entered between two parties, wherein, either of the one is a minor, is not recognized under Law. Hence, it is very important that both the parties should be above 18 years of age.
Sound Mind: It is also important that both the Principal and the Agent must be of the sound mind since the contract with the person of unsound mind does not bind the parties to such a contract.
Types of Power of Attorney:
There are two types of Power of Attorney. They are:
General Power of Attorney: General Power of Attorney gives wide power to the agent to do various acts on behalf of the Principal, without any specifications.
Special Power of Attorney: Special Power of Attorney is executed in those cases wherein the agent is empowered to do such acts specified in such Power of Attorney. In this kind of Power of Attorney, the power given to the agent will be revoked as soon as that particular act, for which the power of attorney is executed, is performed and once such an act is completed, Power of Attorney does not subsist.
Sub-delegation of power:
The general principal is that an agent can neither sub-delegate his powers to a Sub-agent nor can appoint another power of attorney. The said principle is well expressed in Latin maxim “Delegate non protest delegate”, which means a person who is delegated with certain powers cannot delegate such powers to a third person. But, section 190 of the Indian Contract Act provides certain exceptions, wherein the agent can appoint sub-agent. However, such sub-delegation must be done in connivance with the Principal, who has to ratify all the acts done by the agent on his behalf. The following are the circumstances under which Sub-delegation is permitted:
1. The nature, custom of the trade is such that it requires the appointment of sub-agents.
2. The recitals in such power of attorney authorizes the agent to sub-delegate his powers to another agent.
Registration and Notarization:
Under Section 17 of the Registration Act, if any transaction involves transfer, assignment or creation of right, title and interest over the immovable property and the value of such property is Rs.100 or more, then registration of such documents is mandatory.
As regards execution of Power of Attorney, if the principle assigns right, title and interest over the immovable property in favor of the agent and authorize the agent to execute any document on his behalf, in such case registration of the power of attorney is preferable. However, if the agent is delegated with the powers which does not involve any kind of assignment or transfer of interest over the immovable property, then power of attorney notarized before Notary Public or even before the Magistrate, is considered to be authenticated documents.
Thus for example, if a person executes Power of Attorney, authorizing the Power of Attorney Holder to execute sale deed on his behalf before the proper registering officer, then it is advisable to get such power of attorney registered. On the other hand, if Power of Attorney is executed, authorizing the power of attorney holder to prosecute or defend the suit, then GPA can be notarized before Notary Public. However, the Court shall presume that a power of attorney executed before and authenticated by Notary public or any Court, Judge, Magistrate, Indian Consul or Vice-consul or Representative of the Central Government was so executed and authenticated. If the Power of Attorney is not signed and sealed as required under law, it is nothing more than a waste paper.
In either of the case, each page of the document, whether registered or notarized, has to bear official stamp of the Sub-Registrar office or Notary Public and must disclose the registration number, Book number and signature of the Sub-Registrar or Notary. If the same is notarized, then, apart from the above, appropriate Notary Stamp has to be affixed.
Outside India:
Section 85 of the Indian Evidence Act applies equally to documents authenticated by Notaries Public of other countries. However, the same has to be done by the designated Officers. So any power of attorney executed outside India shall be authenticated by notary of such country or Indian Consul/Embassy.
Stamp Duty:
Power of attorney, executed and notarized in any country in favour of Power of Attorney Holder, residing in India, has to be duly stamped within four months from the date of receipt of the same and the stamp duty in such case has to be at the District Registrar’s office. However, if the same is executed in India, the same has to be executed on the document sheet, duly stamped.
Stamp duty in either of the case will be Rs.100- if the same is executed in favour of one to five of them and if power of attorney is given to more than five persons, then the actual stamp duty payable is Rs.200/-.
Cancellation of G.P.A:
Power of Attorney can be cancelled by either of the parties to the said contract. However, the same has to be done by giving proper notice to the other, clearly mentioning the intention of the person to revoke the said Power of Attorney and notice to that effect has to be given to the public. However, the Principal cannot cancel the agency after the agent exercises his powers partially. If the power of attorney is given only for the specific purpose and that purpose is fulfilled or if either of them dies or becomes unsound, then such an instrument automatically gets cancelled. Nevertheless, proper notice is a must.
If the agent himself has any interest in the property which is the subject matter of the agency, then the same cannot be cancelled unless the agent agrees.
Representation of Owner:
In Bangalore, there are many instances wherein it is seen that the Power of Attorney Holder, in his individual capacity, representing himself as the owner instead of the actual owner will convey immovable property, which act does not confer any kind of right over the purchasers since the document itself is void and not binding on the parties. So it is very important to verify as to whether the conveyance has been made by the GPA Holder, duly representing his Principal/Owner.
In the recent times, with the growing boom of real estate in Bangalore, the instrument of General Power of Attorney is playing a major role, not only in regard to sale or purchase of the property, but also in all other related fields. However, abundant caution has to be taken at the time of executing Power of Attorney and also cancellation of the same because the same can also be used as a weapon involving acts of fraud or conspiracy to misguide and cheat public.
PROCEDURE FOR THE EXECUTION OF POWER OF ATTORNEY
Power of Attorney is most widely used document in property transactions. This is because many acts, transactions have to be carried out simultaneously and the same persons cannot be present at different place at the same time. Moreover, timing is very important in property transactions.
Power of Attorney in simple terms means a person authorizing another person to do acts or certain acts on his behalf.
The Power of Attorney Act 1882, defines power of attorney “includes any instrument empowering a specified person to act for and in the name of the person executing it”.
The Karnataka Stamp Act 1957 defines power of Attorney as “includes any instrument (not chargeable with fee under the law relating to court fees for the time being in force) empowering a specified person to act for and in the name of the person executing it”.
The Power of Attorney Act 1882 has 5 sections, only and provisions of Indian Contract Act under Chapter X dealing with Agency are applicable to Power of Attorneys. Section 182 of Indian Contract Act defines agent as “an agent is a person employed to do any dealings with the third persons”. The person for whom such act is done or so represented is called principal.
The person who is executing the Power of Attorney is called principal or the executant and the person to whom power is granted is called GPA holder or beneficiary. Both the principal and agent should be of sound mind and majors. The relation between donor and done is one of principal and agent, which has its genesis in a contract.
There are two kinds of powers of attorney
a. General Power of Attorney.
b. Specific Power of Attorney.
The general power of attorney gives wide powers to the agent to do various things on behalf of principal as detailed in deed and not confined to any specific act or acts relating to a specific subject.
Specific power of attorney is given in respect of single specified transaction like selling of particular property. Once the said particular act is completed, the special power of attorney naturally gets revoked or the powers of the holder gets exhausted.
Though power of attorney is a contract of agency, there are certain differences between agency and power of attorney. Power of attorney creates special power of agency, which entitles the holder to use principal’s name in the transaction entered into. Where as an agent who is not a power of attorney holder is not entitled to for such special powers, power of attorney holder acts in the name of his donor.
Stamp duty
Power of attorney attracts stamp duty which varies from state to state. Article 41 of the Karnataka Stamp Act prescribes the stamp duty as follows:
(d) when authorizing more than five persons but not more than ten persons to act jointly and severally in more than one transaction or generally; (f) in any other case. N.B.- The term “Registration” includes operation incidental to registration under the Registration Act, 1908 Explanation- For the purposes of this Article more persons than one when belonging to the same firm, shall be deemed to be one person
(a) When executed for the sole purpose of procuring the registration of one or more documents in relation to a single transaction or for admitting execution of one or more such documents; One hundred rupees
(e) when given for consideration and authorizing the attorney to sell any immovable property; The same duty as a conveyance for a market value equal to the amount of the consideration.
(eb) when given to person other than the father, mother, wife or husband, sons, daughters, brothers, sisters in relation to the executant authorizing such person to sell immovable property situated in Karnataka State.
Eight rupees for every one hundred rupees or part thereof on the market value of the property which is the subject-matter of power of Attorney:
Provided that the duty paid on such instrument is adjustable towards the duty payable on the instrument of sale or transfer executed subsequently in favour of either the Attorney holder or any other person.
One hundred rupees.
Attestation
The attestation of Power of attorney is not compulsory but in order to avoid any disputes, and to establish the proof of genuineness it is advisable to get the document attested by two witnesses.
Registration
The registration of document is not compulsory, when it is to be registered it shall be presented at the sub registrar’s office who has jurisdiction over the immovable property, referred in the document. However in other cases, the document may be presented for registration either in the office of the sub registrar in whose sub district, the document was executed or in any other sub registrar office in the state as the executants desire.
Notarizing
Notarizing the power of attorney is as good as registration. Section 85 of Indian evidence Act applies to the documents authenticated by the notaries. The court shall presume that every document purporting to be power of attorney and have been executed before and authenticated by notary public or any court, judge, magistrate, Indian consul or vice consul or representative of Central Government shall be presumed to be properly executed and would be a conclusive proof.
Each page of the document notarized should bear the official stamp of the notary disclosing his registration number, jurisdiction and also signature of the notary public. Appropriate notary stamp has to be affixed.
Documents executed outside India
Any power of attorney executed outside India needs authentication, which means it has to be executed in the presence of certain designated officers. As per section 85 of Indian Evidence Act the following persons are empowered or authenticate the documents;
1. Notary public
2. Any court of Judge or Magistrate
3. Indian consul or vice consul.
4. Representative of the Central Government
Section 85 of the Indian Evidence Act applies equally to the documents authenticated by notary public of other countries. So any power of attorney executed outside India shall be authenticated by notary public of such country or Indian consul, vice consul or by representative of Central Government. Such documents need to be stamped within three months from the date of receipt in India, to be payable at the District Registrar’s office as per sections 31 & 32 of Karnataka Stamp Act 1957.
AUTHENTICATION AND ATTESTATION OF POWER OF ATTORNE
Indian Registration Act, 1908, specifically provides as to who should present the document for registration. Section 32 of the Act stipulates that any document the registration of which is compulsory or optional shall be presented by following;
1. By the executant or person claiming under the document.
2. In case of a copy of decree, order, any person claiming under such decree or order.
3. By the representative or assign of such persons referred above.
4. By agent of the persons referred above or by a representative or assign duly authorized by Power of Attorney executed and authenticated as prescribed in the Act.
There are certain exceptions as provided in sections 31, 88 & 89.
POWER OF ATTORNEY
The section 32 of the Act, prescribes that only certain category of Power of Attorney holders are recognised to present documents for registration, they are
(a) If the person executing the Power of Attorney resides in any part of the country at the time of execution where the provisions of the Indian Registration Act apply, only Power of Attorneys executed before and a authenticated by registrar or sub-registrar of the district, where the person executing Power of Attorney resides.
(b) In case the person executing the Power of Attorney resides in any part of India, at the time of execution of the Power of Attorney, where the provisions of the Indian Registration Act does not apply, only Power of Attorney executed and authenticated by any Magistrate.
(c) In case of person executing Power of Attorney resides out of India at the time of executing power of Attorney, only Power of Attorney executed before and authenticated by a Notary Public, or any Court, Judge, Magistrate, Indian Consul or Vice Consul or representative of the Central Government.
It may be noted that in case of authentication by registrar or sub registrar, such officers should be of the district where the principal resides, but no such stipulation in case of authentication by a magistrate.
However, the Act exempts the following people from attending the registration office or court for executing and obtaining authentication of Power of Attorney. This exemption is available only to persons residing in India and not to persons residing outside India.
• They are persons who are unable to attend without any risk or inconvenience because of bodily infirmity, ill health and illness.
• Persons who are in jail under Civil or Criminal process.
• Persons exempted by law from personal appearance in court.
In case of Power of Attorneys executed by persons who are exempted from a personal appearance, to execute and obtain authentication, the sub-registrar or magistrate, may attest the Power of Attorney after satisfying himself that the Power of Attorney has been voluntarily executed by the Principal. In case of necessity the concerned officer may either visit the house of the principal, jail, examine him or may issue commission for his examination. Any Power of Attorney as detailed above may be proved by production of it, without further proof, when it purports to have executed before and authenticated by a person or a court.
Authentication and Attestation
The section 33 of the Act refers to two different words authentication and attestation. Both are not similar. Attestation is done in case of Power of Attorney executed by persons, who are exempted from personal appearance before court, registrar, and sub registrar under section 33 of the Act.
Rule 63 of Karnataka Registration Rules 1965 prescribes the procedure of authentication and attestation. When a Power of Attorney is executed before registering officer, he shall authenticate the same, after satisfying himself the identity of the party executing the Power of Attorney and if necessary after obtaining the left hand thumb impression of the party against his signature. The authentication shall be as follows
“Authentication under clause (a) of sub-section (1) of section 33”
This Power of Attorney has been executed by ………… of ……….. in my presence on the …………. Day of ……………..20…. The said……….. is personally known to me/ the identity of the said………….. has been provided by the testimony of Sri………………… to my satisfaction and whose signatures is affixed to this endorsement.
Signature of the
Person identifying the principal
Seal
Dated
Signature of (Sub) registrar
In case of attestation where the principal has not attended the office of the registering authority, the registering officer will attest the Power of Attorney but not authenticate it. In such cases, if the registering officer himself attends the residence of principal or if the principal appears in the office behind a pardah as is in the case of Ghosha ladies the registering office may examine the principal with the help of any witness. The following form of attestation will be made;
“Authentication under clause (a) of sub-section (2) of section 33”
This Power of Attorney has been voluntary executed by ………… of ………… I have satisfied myself in this behalf. The personal examination of the said …………. on commission. The said ……….. is personally known to me. The identity of the said person has been proved by the testimony of ……………. to my satisfaction and whose signature is affixed hereto.
Signature of the
Person identifying the principal
Seal
Dated
Signature of (Sub) registrar
Procedure:
While authenticating the Power of Attorney, which runs into more than one sheet of paper, the seal and signature of the Registering officer shall be affixed to each sheet.
If the Power of attorney which has to be authenticated but not to be registered contains interlineations, blank, erasure, or alteration in the body of Power of Attorney, a detailed footnote of number of interlineations, blank, erasures, alteration has to be added to the document below the authentication and shall be signed by the registering officer. Such detailed footnote is necessary even if the principal has made such footnote. If there are no interlineations etc., such fact has to be noted.
If the authentication or attestation endorsement contains any interlineations, each such interlineation has to be initialed by registering officer.
District registrars or sub registrars are not authorised to authenticate or attest the Power of Attorney, other than those required for registration purpose. The Power of Attorney should contain a specific authority to present the document or to admit the execution of a document by principal, and then only it can be authenticated or attested. A power of attorney may be registered like any other document, but unless it is authenticated or attested, it is not valid for using for presenting for registration of other documents executed by principal. One has to understand the difference between the registering the power of attorney and using the power of attorney for presenting the documents executed by principal for registration.
The authentication or attestation of Power of Attorney is required only when a document executed by the principal is presented for registration. But if the document is executed by the Power of Attorney holder and presented by Power of Attorney holder, no authentication or attestation is necessary.
