• Sale deed regisistered by POA

I have purchased flat from investor which is a Pvt comoany. Investor first registered that flat in his name through POA say first transaction . And the same flat transferred and register in to my name via POA say second transaction by same person having POA attached with the first transaction. 

After registration I read the POA carefully and it appears POA was for specific to some other project of the investor not for my flat.

Now my question is the investor had purchased the flat from builder ie first transaction will consider as valid transaction or not. If first transaction is not valid then what are the remedies available to me. If first transaction is valid then can I consider my transaction is valid or it will remain invalid. I have already paid the stamp duty and registration charge.
Asked 4 years ago in Property Law
Religion: Hindu

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12 Answers

1) First transaction is not meant for purchase of flat, than howcome the first which false sell the flat to second person. Here the title is not clear on first person name that means first petson doesn't have any legal rights.

2) Second person is also not entitled for owner ship of the flat. Check the clear title person of first transaction and make correction deed with them and registered again. Here correction deed charges are very nominal. You don't have to pay whole registration charges again.

Ganesh Kadam
Advocate, Pune
12335 Answers
191 Consultations

4.9 on 5.0

See if the Power of attorney by the company was specific and for some other project then the first transition of purchase and second of sale both are not valid. For this a confirmation deed for both the transaction with the corrected POA has to be made.

Further read all clauses of power of attorney does it confer any generated authority or power to the person on behalf of company.to sell or purchase any flat.

A deed of confirmation can be signed between builder and investor confirming corrections in POA and valid sale made further then same has to be executed between you and investor.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

) it is necessary to peruse documents cited by you to advice

2)it appears that builder through POA registered flat in investor name

3) sale deed in investor name is valid

4)however if POA was for some other project POA is not valid

5) in such a case you dont have clear and marketable title to property

6)deed of confirmation can be executed by investor

Ajay Sethi
Advocate, Mumbai
87939 Answers
6207 Consultations

5.0 on 5.0

Dear Sir,

You need not bother, please read the end paras which are more applica le to your case.

No property sale on power of attorney: Supreme Court

Property sales through the common practice of general power of attorney (GPA) will not give ownership title to the buyer.

In a landmark judgment that is expected to send a large number of property owners into a tizzy, the Supreme Court held that the GPA method of immovableproperty sales is not a valid form of transfer of property.

A three-judge bench presided over by Justice R. V. Raveendran said that property can be lawfully transferred only through registered sale deeds.

"A power of attorney is not an instrument of transfer in regard to any right, title or interest in an immovable property," the bench said, after interpreting various provisions of the law concerning property sales. However, the bench said the judgment will not affect "genuine transactions" under the GPA.

The judgment delivered on Wednesday would have an impact on both freehold and leasehold properties and affect the mode of transfer of property in Delhi and the National Capital Region (NCR) where GPA sales are very common. Even though it can cause some hardship to those who have already purchased property through the GPA, the order will help curb evasion of duties, flow of black money into real estate and also save people from being cheated by unscrupulous owners selling the same property to several people.

• Flat sold by builder to third party whem my Agreement to sale was valid

I had executed a Agreement to sale on one flat at Agra U.P. in 02/11/2012 with a validity of 15 months ,after 15 months the builder with mutual consent and reason that the the construction work is not over renewed it for another 12 months upto 28/01/2015,again with the same reason it sought and extension of another 6 months of agreement to sale which was made and agreement to sale was extended upto 22/07/2015.

After this we issued a notice to the builder and on reply to notice the builder through its legal counsel sought again time upto 15/10/2015.Subsequently again a notice was given on 17/10/2015 to execute the sale deed but the builder again replied by letter and sought extension upto 15/07/2016 with the same reason that flats are incomplete.After 15/10/2016 the builder is untraceable and recently he was arrested on forgery charges and currently in jail.On enquiry I came to know that the builder sold my flat that was having valid agreement to sale to third party with sale deed dated 28/06/2014.During this period my agreement to sale was valid but now builder is in jail what is the legal remedy and the party having sale deed has occupied the flat .now what is the legal remedy me to get my flat back.

Section 53A in The Transfer of Property Act, 1882

1[53A. Part performance.—Where any person contracts to transfer for consideration any immoveable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty, and the transferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then, notwithstanding that 2[***] where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefor by the law for the time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract: Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof.]

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Sec 202 of Indian contract act says irrevocable GPA cannot be cancelled as it is executed for consideration.

Section 202 in The Indian Contract Act, 1872

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. —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. (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 is it 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 is it terminated by his insanity or death."

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Govt tightens power of attorney rules

CHENNAI: The Tamil Nadu registration department has tightened the noose around realtors using power of attorney (POA) for fraudulent land deals. Power of attorney authorizes a person to carry out transactions or act legally on behalf of another.

Under the new rules, a power of attorney holder seeking to carry out a land transaction will have to provide documentary evidence to the sub-registrar to prove that the principal, the person who issued the power of attorney, is alive. The principal has to obtain a "live" certificate with his photograph affixed to it from a registered medical practitioner or a gazetted officer. These certificates are valid for 30 days.

As per a recent order of the inspector general of registration, the new rules are applicable to all POAs registered from February 4. By law, POA is not valid once the principal dies. Section 34 of Tamil Nadu Registration Act says it is the duty of the sub-registrar to ascertain whether the POA holder has the right to execute a transaction on behalf of the principal. But sub-registrars register property documents without bothering to verify whether the principals were alive.

"In Tamil Nadu, where a large number of land transactions are carried out on the basis of POAs to circumvent payment of stamp duty and registration fees. Many instances have been reported of POA holders selling land after the death of the principal. Buyers get into trouble when legal heirs of the principal claim rights over the property. Such cases end up in protracted legal battles and ultimately the sale deeds are declared invalid," said a senior official.

There have been instances of people impersonating land owners and executing fraudulent POAs. In one case, land worth 9 crore on Venkatnarayana Road was sold to a business group based on a POA, reportedly executed by the land owner in 2008. Legal heirs of the land owner subsequently filed a case of forgery against the business group, brokers and others involved in the deal as the owner had died 28 years earlier. When police refused to take prompt action, the owners moved the court.

As per law, the principal also has the right to rescind a POA. "If there is a mention of a consideration (amount) in the POA, the holder can claim that money through legal means. But he cannot claim rights over the property once the POA is rescinded or the principal dies," said the official.

In 2010-11, more than 3.75 lakh POAs were registered across Tamil Nadu for property-related transactions. The number came down to 1.8 lakh last year. It is going up again this year, said the official.

Last December, the department made it mandatory that photographs of the holder and the principal be

Kishan Dutt Kalaskar
Advocate, Bangalore
6050 Answers
381 Consultations

4.8 on 5.0

1. A company is not a natural person. So it acts through the agency of a natural person.

2. This is either through a board resolution or power of attorney in favour of a trusted person of the company.

3. So the transaction between builder and company, where company was represented through a power of attorney holder, is valid.

4. Generally it is not necessary to specifically state in the power of attorney as to for which particular project the POA is granted. It is a general POA which is applicable for various projects.

5. Such a power authorises the PoA holder to sign on behalf of the company and admit the signature before the sub-registrar

6. Had there been any problem, the registration office would not have registered your sale deed in the first place

7. I suggest you put up the power of attorney using which the investor company entered into sale transaction with you, for review by a good lawyer on this platform

8. Also you can request a confirmation letter from the investor company to issue a statement on its letterhead that the PoA also included the power to represent the company for this particular project (in which you bought the flat) and for entering into sale deed with prospective buyers of flats in that project. That will also do.

Yusuf Rampurawala
Advocate, Mumbai
6882 Answers
79 Consultations

5.0 on 5.0

1) Ask you can ask for corrections of documents and re registered your projects with correct authority names and rights of individuals.

2) If you want I can review your POA documents at reasonable rates.

Ganesh Kadam
Advocate, Pune
12335 Answers
191 Consultations

4.9 on 5.0

This is my response to you:

1. Engage a local lawyer and let him/her read through the agreement and POA on your behalf;

2. Since the first POA was not valid in law, therefore that transaction is itself void in law;

3. But if the person who received the first POA got the property through the same and got it registered as well, then he was the true owner of the property;

4. On the basis of POA, you received the ownership of the property after paying stamp duty and registration fees then you are the rightful owner of the property;

5. As long as the sale deed is registered and the sub-registrar has a record of the same, you become the true owner of the property;

6. If now you realise that the POA was wrongly construed, then you can execute a Rectification Deed in that regard and get the error corrected.

Gowaal Padavi
Advocate, Mumbai
1920 Answers
5 Consultations

5.0 on 5.0

POA should be specific for the project

2) deed of confirmation has to be executed by the principal

Ajay Sethi
Advocate, Mumbai
87939 Answers
6207 Consultations

5.0 on 5.0

No the execution is not proper as it specified power of attorney for some other project and it does not confer right for present project.

Let some lawyer go through the poa if it is not proper and no registration right for present sale deed a deed of confirmation has to be executed.

Shubham Jhajharia
Advocate, Ahmedabad
25516 Answers
179 Consultations

5.0 on 5.0

Firstly, now after the latest Supreme Court judgement, transfer of property transaction through POA stands at less credibility though as provoke are still in confusion it has not found feasible for the understanding of the same some how.

Secondly, all the transactions are valid sir, as all have been duly executed before the registrar.

Thirdly, but yes the point that it has been mentioned as with regard to some other project then you need to get it clarified at investor’s end immediately.

So that you can save yourself from any cheating, and hold some credibility in your complain if any without any delay.

Sanjay Baniwal
Advocate, South Delhi
5464 Answers
13 Consultations

5.0 on 5.0

The POA to the investor will not confer absoluter title to the seller.

He is authorised to sell the property on behalf of the owner, hence the POA itself cannot be considered as first transaction.

If the investor is not authorised to sell this flat then execution of registered sale deed by the so called investor to you also cannot be held valid in the eyes of law

Have you referred the property documents to a local advocate seeking opinion about the genuineness of the property and his recommendation to buy this property?

Do it immediately if not done so far so that your huge investment will be safe and secured.

Your own understanding after reading the documents will keep creating several doubts every day about each and every thing, so it is better that you obtain a legal opinion as soon as possible.

T Kalaiselvan
Advocate, Vellore
78097 Answers
1543 Consultations

5.0 on 5.0

If the POA deed is not specific about the authorisation to sell the properties of your category then he cannot execute a sale deed oir even enter into a sale agreement with you on behalf of the land owner.

You should read the document properly to understand the correct meaning of the contents or refer the same to an advocate in the local instead of you taking wrong decisions on the basis of your misconceptions of the contents therein.

From your contents it appears that you are confused about the whole lot because you have not been opined properly about this by a technically prudent person.

T Kalaiselvan
Advocate, Vellore
78097 Answers
1543 Consultations

5.0 on 5.0

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