• Power Of Attorney - Is it legal or Illegal ? What it's alternatives for home purchase?

Dear Sir,
 Presently I am going through a property purchase process in Maharashtra. It's a home constructed in a well settled locality with a lots of homes constructed in the area and a well settled colony built on it, but the land is still NOT a Non-Agricultural land. 
Since presently there is no registration being allowed for home purchase in this area(which was previously allowed), the seller is offering a mode of sale of this property through Power of Attorney. He has his complete ownership of the property (previously registered when the registration was being allowed). 
 Now i read an article where it says, since 2011 SC has made GPA for immovable property sale illegal. is it still true? If true how can I proceed with purchase of this property? Kindly guide me what alternative legal methods can i proceed with.
thank you..
Asked 3 months ago in Property Law from Nashik, Maharashtra
Religion: Other

Yes it is illegal and the purchase is not safe. The land can be converted and sold there is no other way .

Shubham Jhajharia
Advocate, Ahmedabad
19398 Answers
76 Consultations

5.0 on 5.0

Yes it is true. 

You can purchase the property by entering into a sale deed. 

If at present the sale is not being done then you may enter into an agreement to sale, stipulating a condition that the sale will be done when the land will be converted. 

While doing this you must not pay the entire sale consideration. 

I would rather advise you to not put your hard earned money in this property. 

 

Regards 

Anilesh Tewari
Advocate, New Delhi
16920 Answers
259 Consultations

5.0 on 5.0

POA is legal but cannot be used as substitute for sale deed.  Even if you have POA, sale deed is required

Prashant Nayak
Advocate, Mumbai
12963 Answers
23 Consultations

4.6 on 5.0

for carrying out construction land should have been converted into NA 

 

2) in order to confer clear and marketable title to property sale deed should be executed in your favour 

 

3) sale through POA does not confer title to property 

 

4) Further of POA is executed in favour of third party it has to be stamped as conveyance 

 

5) don’t purchase the property 

Ajay Sethi
Advocate, Mumbai
67029 Answers
4046 Consultations

5.0 on 5.0

Plz do not buy

Firstly the land is not NA, hence construction itself is illegal

Secondly a POA is not a valid mode of ownership transfer and confers no ownership rights on buyer

Better stay away from such dubious projects

Yusuf Rampurawala
Advocate, Mumbai
4459 Answers
25 Consultations

5.0 on 5.0

1.  Sale /Purchase of ANY "immovable property", via a Registered POA is legal and permissible, all over India, PROVIDED the POA holder executes a duly Stamp Duty paid Registered Sale Deed.

2.  Title-Ownership just cannot be transferred on the revenue records (Tahsil /Municipal offices), based on a POA.  It mandatorily requires a duly Stamp Duty paid Registered Sale Deed.  ELSE the Title will remain defective and further Sale /Purchase /Gift /Donate /Mortgage /whatever.... shall not be possible.

Hemant Agarwal
Advocate, Mumbai
2430 Answers
14 Consultations

5.0 on 5.0

1) since there is no conversion to NA the property is illegal and buying such property is a high risk. 

2) POA transfer is not valid unless it is between close relatives.

3). Don't buy the property. 

Robert D Rozario
Advocate, Kolkata
24 Answers

5.0 on 5.0

Dear Sir,

The following information may kindly be read:

Buying property through General Power of Attorney or GPA

The Honorable court has held that when someone transfers any immovable property through GPA, it does not convey any right or title or create any interest in respect of such immovable property in favor of such person as only a deed of conveyance/sale deed which is duly stamped under the provisions of the Stamp Act applicable to the state in which such property is situated, as well as registered under the provisions of the Registration Act, does so.

Validity and Scope of General Power of Attorney

A lot of real estate is being bought through GPA; however, as a power of attorney is not an instrument of transfer in regard to any right, title or interest in an immovable property, it still serves several purposes for buyers and sellers, particularly where registration of sale deed is not possible due to some legal issues.

 

The legal definition of the GPA is that it is a mere agency whereby the grantor authorizes the grantee to do certain acts specified therein; this he does on behalf of grantor, which when executed will be binding on the grantor as if done by him. Interestingly, GPA is revocable or can even be terminated at any time unless made irrevocable in a manner known to law.

GPA is Not Irrevocable

The law is that even if the parties have determined that the GPA is irrevocable it won’t have the effect of transferring title to the grantee. Thus, in totality GPA does not convey ownership of the buyer; however, a GPA holder may execute a deed of conveyance in exercise of the power granted under the power of attorney and convey title on behalf of the grantor.

Taking the judgment from the Supreme of India into consideration it’s a settled law now that immovable property can be legally and lawfully transferred or conveyed only by a registered deed of conveyance and not through GPA. Thus, as GPA does not conclude complete transaction, the Supreme Court parties should consider registering the deed of conveyance.

The Supreme Court in the case had however, observed that GPA transactions may also be used to obtain specific performance or to defend possession under section 53A of Transfer of Property Act, 1882.

 

 

 

Netravathi Kalaskar
Advocate, Bengaluru
3209 Answers
15 Consultations

5.0 on 5.0

Hello,

Yes it is true. Please go through SURAJ LAMP case.

Regards

Swarupananda Neogi
Advocate, Kolkata
1061 Answers
2 Consultations

4.8 on 5.0

my opinion, don't purchase the property. 

you can approach Advocate for proper legal advice along with all documents and accordingly matter can be taken further.

Mohammed Mujeeb
Advocate, Hyderabad
10264 Answers
3 Consultations

4.5 on 5.0

Sale of property through GPA is illegal and invalid in law, the supreme court has given a clear verdict on it.

This is provision of law even though the supreme court has passed a judgment based ion this law.

It would be advisable to not to enter into any such purchase when ther is no certainty about the property registration in the future too.

T Kalaiselvan
Advocate, Vellore
56755 Answers
706 Consultations

5.0 on 5.0

  1. As per the information mentioned in the present query, makes it clear that though the registration has not been  stopped, but he has the ownership paper as registered earlier by the authority itself.
  2. So, even if the same has been stopped now, the authority cannot call it an illegal transaction.
  3. And GPA or POA by SC is being stopped only in cases wherein one party buying or selling give the power to someone else to appear on his or her behalf before the office of the registrar.
  4. Now, you just have to concerned about the transfer process in your name and the same you should draft a legal RTI to the department to get your answer on them then proceed otherwise no use of getting property without its registration on your name.

Sanjay Baniwal
Advocate, South Delhi
4895 Answers
11 Consultations

5.0 on 5.0

No sale of property through GPA valid and legal but the GPA should be duly stamped and registered.

You can proceed through GPA but a GPA is valid till the executant is alive or if there is Cancellation deed signed by executant. 

So in my opinion you should not go ahead with purchase through GPA. And should wait till the stay is vacated from registration of property.

Mohit Kapoor
Advocate, Rohtak
3599 Answers
1 Consultation

5.0 on 5.0

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