1)agreement entered into by Y in favour of Z is valid as it was executed during lifetime of the principal

2) on demise of X POA ceases to have effect

3) section 202 of contract act provides that GPA coupled with consideration is irrevocable

Section 202 of the Contract Act, 1872 provides that the Power of Attorney coupled with interest is irrevocable and cannot be revoked/terminated even upon the death of the principal. Section 202 of the Contract Act is reproduced hereunder:-

"SECTION 202. Termination of agency where agent has an interest in subject-matter:-

Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest.

Illustrations

(a) A gives authority to B to sell A's land, and to pay himself, out of the proceeds, the debts due to him from A. A cannot revoke this authority, nor can it be terminated by his insanity or death.

(b) A consigns 1,000 bales of cotton to B, who has made advances to him on such cotton, and desires B to sell the cotton, and to repay himself, out of the price, the amount of his own advances. A cannot revoke this authority, nor it is terminated by his insanity or death."

1. The POA ceases to exist with the death of the principal.

2. However if the GPA was coupled with interest then it does not extinguish with the death of the principal.

3.Decision- Calcutta High Court (Appellete Side)

Smt. Shamali Das vs Swadesh Ghosh & Ors on 10 July, 2009

Author: Bhaskar Bhattacharya

Form No. J(2)

IN THE HIGH COURT AT CALCUTTA

Appellate/Revisional/Civil Jurisdiction

Present:

The Hon'ble Mr. Justice Bhaskar Bhattacharya

And

The Hon'ble Mr. Justice Prasenjit Mandal

F.M.A. No. 159 of 2009

(C.A.N. 536 of 2009)

(C.A.N. 721 of 2009)

(C.A.N. 1475 of 2009)

Smt. Shamali Das

Versus

Swadesh Ghosh & Ors.

Another one - Delhi High Court

Hardip Kaur vs Kailash & Anr. on 18 May, 2012

Author: J.R. Midha

* IN THE HIGH COURT OF DELHI AT NEW DELHI

+ RFA No.648/2006

% Reserve on : 4th May, 2012

Date of decision : 18th May, 2012

HARDIP KAUR ..... Appellant

Through : Mr. Kaushal Yadav, Adv.

versus

KAILASH & ANR. ..... Respondents

Deed of rectification would be necessary to correct the errors if any in the sale deed

The Supreme Court of India, in Seth Loon Karan Sethiya v. Ivan E. John, AIR 1969 SC 73, held: where the agent has himself an interest in the property which forms the subject matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest. It is settled law that where the agency is created for valuable consideration and authority is given to effectuate a security or to secure interest of the agent, the authority cannot be revoked.

Take advice from your lawyer.He will guide you.

As per Indian Contract Act, "Section 202, Termination of agency, where agent has an interest in subject matter.- Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest.

The object of giving validity to a power of attorney given for consideration even after death of the executants is to ensure that entitlement under such power of attorney remains because the same is not a regular or a routine power of attorney but the same had elements of a commercial transaction which cannot be allowed to be frustrated on account of death of the executant of the power of attorney.

Plz give rule position and circulars in pdf

In a case decided by IN THE HIGH COURT OF DELHI AT NEW DELHI in RFA No.358/2000 in the mater between

Shri Ramesh Chand vs Suresh Chand & Anr. on 9 April, 2012;

A power of attorney is not an instrument of transfer in regard to any right, title or interest in an immovable property. The power of attorney is creation of an agency whereby the grantor authorizes the grantee to do the acts specified therein, on behalf of grantor, which when executed will be binding on the grantor as if done by him (see Section 1A and Section 2 of the Powers of Attorney Act, 1882). It is revocable or terminable at any time unless it is made irrevocable in a manner known to law.

"A grant of power of attorney is essentially governed by Chapter X of the Contract Act.

The Supreme Court has however reiterated that rights which are created pursuant to Section 53A of the Transfer of Property Act, 1882 dealing with the doctrine of part performance (para 12), an irrevocable right of a person holding a power of attorney given for consideration coupled with interest as per Section 202 of the Contract Act, 1872.

Certain rights can exist in an immovable property pursuant to the provisions of Section 53A of the Transfer of Property Act, 1882, Section 202 of the Contract Act, 1872. There also takes place devolution of interest after the death of the testator in terms of a Will.

Is it necessary that the LRs of deceased have 2 execute ratification deeds in favour of purchasor

In any case the principal, if was alive during the execution of sale deed by the power agent, would have ratified the sale deed, thus the LRs of the deceased principal are now required to ratify the execution of the registered sale deed

Sir how to understand coupled with interest ..

a power of attorney executed in pursuance of, or in furtherance of an agreement of sale, transfer lease etc., stand on a different footing. Where the authority is given to an agent for effectuating any security or to protect or secure any interest of the agent, then the power of attorney is irrevocable during the subsistence of such security or interest. An agency coupled with interest or an Irrevocable power of attorney for consideration, may amount to an equitable assignment of the rights under the contract, by the Grantor/Executant in favour of the holder of the attorney.

The owner enters into an agreement of sale with the purchaser and receives full or part consideration for the sale and delivers possession of the subject-matter of the sale in part-performance and executes a power of attorney authorising the agent to effectively enjoy or use the property or even to sell the property. The non-completion of sale and execution of a power of attorney pending sale, may be due to several reasons, that is non-receipt of a part of the consideration or non-receipt of legal clearances required for a conveyance or even to postpone or avoid payment of stamp duty/taxes/fees related to a conveyance,