I wish to give POA to my uncle residing in India, to sign property sale-deed on my behalf (as seller). However, I cannot afford upfront charge of stamp duty + registration fees for registering of this POA. How do I handle this? Can buyer of my property pay on my behalf if POA registration is done simultaneously with sale-deed settlement? Any other options? I am an NRI who has no blood relatives in India and no desire (if possible) to travel to India for signing of sale deed. Property is in state of Maharashtra.
It is better you come down to india to execute sale deed as you do not have any blood relatives in india
2) please note that POA if executed in favour of non blood relative has to be stamped as conveyance
3) in other words it would attract 6 per cent stamp duty
Could buyer of the property pay the 6 per cent stamp duty on my behalf ?
He can pay stamp duty on your behalf but he would reduce final sale consideration to be paid to you
But normally isn't the buyer supposed to pay stamp duty anyway? In this case, I would just be asking him to pay it at time of POA registration directly at sub-registrar's office. And, at same time my POA (uncle) would sign the conveyance deed in exchange for payment of the sale consideration. Would this not work?
For POA buyer may pay on your behalf but will ask for reimbursement of money paid by him
you can talk to the buyer in this regard
There's a way out for your problem. You can avoid paying the exorbitant stamp duty at the time of adjudication of POA, executed by you in favour of your uncle ( a non-blood relative). For this, the wording in the POA has to be carefully drafted. Similar case I have handled successfully in Bengaluru, Karnataka..
Power of Attorney can be given to anyone for any purpose. It is not compulsory to give it to blood relatives or near relatives. But, if someone wants to sell immovable property in that case due to Stamp Duty rules, it will be beneficial to give it to blood relatives or near relatives. When it comes to the Power of Attorney in favor of non-near relatives given for the sale of the property then stamp duty is equivalent to the conveyance deed will be applicable.
Near Relatives include – father, mother, brother, sister, wife, husband, daughter, son, grandson, granddaughter or father, mother, brother, or sister of the spouse.
Special power of attorney:
In Pune, Mumbai & Maharashtra, if the Power of Attorney for selling the property is assigned to near relatives without any consideration then Stamp Duty can be saved. This kind of Power of Attorney Should be registered compulsorily, there is an exemption for registration if the POA Grantor is staying outside of India.
Uncle do not come under the term of near relatives.
The buyer cannot be asked to share the stamp duty expenses, there is no provision in law for that.
If you agree for the deduction of the stamp duty amount out of the sale consideration amount and request the buyer to bear it, then you may enter into an agreement to that effect and proceed provided the buyer consts to your proposal
The buyer would be liable to pay the stamp duty and registration charges at the time of getting the sale deed registered on his name.
The power of attorney is not a sale deed, hence it would not be proper to ask the buyer to bear the stamp duty twice on the same deed.
However you can discuss with the buyer about it in advance and if he agrees to pay the requisite stamp duty for the registration of the POA deed, on the terms that he would deduct the said amount from the sale consideration amount, you may proceed accordingly.
POA without consideration has nominal fees. If give POA to someone for consideration than heavy stamp duty. In your case it will be nominal.
1.As per practice the buyer pays the Stamp Duty and the Registration fee for registering the Sale Deed.
2. You can also ask him to pay for the registration of the POA as a term for selling your property.
There is no legal bar in paying the stamp duty by the Buyer as per law.
1. Yes, the Buyer is supposed to pay for the registration cost of the asle deed.
2. You can set your term that he shall have to also pay for the registration of the POA.
Yes it can be paid by buyer but the transaction must be simultaneously carried out
Payment of stamp duty on POA is matter of negotiation between buyer and seller. There are many instances where the buyer paid stamp duty on POA.
Dear client,
As per the Indian Stamp Act, the buyer of the property is liable to pay the stamp duty on the sale deed. However, if you want the buyer to pay the stamp duty on your behalf for the POA registration, you can include a clause in the sale agreement to that effect. This clause should clearly state that the buyer will pay the stamp duty and registration fees for the POA registration, and that the amount will be deducted from the sale consideration payable to you.
Once the POA is registered, your uncle can sign the sale deed on your behalf, and the buyer can pay the remaining sale consideration directly to you or as per your instructions.
You should consult a local lawyer in Maharashtra to draft the clause in the sale agreement and ensure that all necessary formalities are complied with for the POA registration and sale deed execution.
instead of giving the POA to your uncle/acquaintance, you can make a POA in favour of the buyer itself who would then use the same to comply with the registration formalities on your behalf
if stamp duty as applicable for a conveyance is paid on the POA, then nominal duty will have to be paid on the sale deed/conveyance
as far as my knowledge goes a poa containing power to sell a property which is given to a non relative is required to fully stamped. registration of such poa is needed only if its an irrevocable poa
however the sub-registrar office will mostly likely create issues so that's why i suggested that grant the poa to the buyer, pay fully duty on it, have it registered and then using that registered poa, the conveyance can be registered, with nominal duty
