Can Power agent sell land to himself
This is is regarding a case in Chennai on 28-2-2001. One Mr Chandru is a Power Agent of the Owner, one Mr Madan. Chandru is also a nominee of a builder. Thus can Chandru (Power Agent) sell a piece of land to himself (nominee of Builder)? Is this not permitted under Section 207 of Indian Contrct Act? Does it mean the transaction done in 2001 is illegal? Can it be quashed today, if taken to court? I prefer an email response at firstname.lastname@example.org instead of a phone call.
Asked in Property Law from Mumbai, Maharashtra
A power of attorney agent is not barred by law to sell the property unto himself by following proper procedures. He is selling the property on behalf of his principal in the capacity of his agent/representative and buying it as a buyer. Passing of consideration is important, and if that is not disputed, the execution of sale deed by a POA agent to himself as a buyer is legally valid.
You could have got more proper answers/opinions if you have discussed your problem too.
1) section 207 of indian contract act provides that Revocation or renunciation may be expressed or may be implied in the conduct of that principal or agent respectively."
2) there cannot be any implied revocation of POA.. The principal, even after having constituted a POA, can himself perform the acts himself. In his absence or at his option, the POA can act.
3) chandru as power of attorney holder has legal right and can sell,alienate and transfer the questioned property to any one
1. What I understood from your query is that one Mr. Madan Chandru is the power of attorney holder of the land owner and he is also a nominee of a builder. The POA holder Mr. Chandru sold the land of the land owner being empowered by the power of attorney executed in his gavour to the nominee of the builder being himself in this matter,
2. Yes, the said transaction is perfectly valid,
3. These procedure is followed almost always by the builders for developing multistoried buildings on the land of the owners.
1. There will be conflict of interest. So agent technically can't transfer property in his own name.
2. Only the interested party can challenge this deal by way of suit for declaration and injunction.
1. The POA agent can exercise those powers which are conferred on him by the instrument of his appointment i.e POA.
2. Unless the POA specifically authorizes POA to sell the property to himself he cannot do so.
3. Section 27 of ICA does not come into play here by any stretch of the imagination.
4. If POA has sold the land to himself then the owner can challenge it in the court which can quash it as illegal.