An instrument of Power of Attorney (for short “POA”) is an important tool for the persons desirous to do certain deed or act or work but are not able to do so personally for want of time and other constraints. Thus, a POA is an effectual lawful agency, authority, permission, powers entrusted and delegated by such persons to any other person who is eligible for entering into legal contract and is willing to act for such person i.e. the grantor of POA.
The grantor of the POA is usually termed as Grantor and the Grantee is termed as the Donee.
The POA can be given for consideration or without consideration and as such creates the relationship of Principal and the Agent with regard to the Grantor and the Grantee respectively. Depending upon the nature of powers and authority desired to be granted, the POA can be optionally made revocable or irrevocable.
There are numerous circumstances in every day life where the need for POA is severely felt. A law firm is expected to understand and analyse each circumstance, what powers and authority are needed, what is the duration of the POA and many other considerations and in contemplation thereof has to draft and devise an appropriate POA.
POA executed out of State of Maharashtra
The provisions of the Bombay Stamp Act 1958 require that where the Power of Attorney is executed out of the State of Maharashtra i.e. within or without India then such Power of Attorney needs to be submitted for proper certification of the Appropriate Authority under such Act whereupon only such POA becomes operable and cognizant. Stamp Duty applicable to all kinds of POA is governed by Article 48 of the Bombay Stamp Act 1958.
Indian Registration Enactment vis-à-vis the POA
Where any document is to be presented for registration under the Indian Registration Act 1908 (IRA) and such document is presented by the agent of the person executing such document on the basis of a POA then the IRA requires such POA:-
if executed in the area where IRA is in force, to be authenticated by the concerned Authority under IRA;
- if executed in the area where IRA is not in force, to be authenticated by any Magistrate;
- if executed in the area outside India, to be authenticated by a Notary Public, or any Court, Judge, Magistrate, Indian Consul or Vice Consul, or representative of the Central Government.
The act done or purported to be done under the authority contained in the POA is subsequently confirmed and ratified by the Grantor by a Deed of Confirmation/Ratification.
Ratification Confirmation & Cancellation:
POA is governed by various legislations relating to Powers Of Attorney, Contract, Registration, Stamp duty, and other relevant statutory and regulatory laws.
The nature of Powers may vary from case to case depending upon the circumstances which shall be inclusive of the following:
- General Power of attorney.
- POA by a member of family while going abroad.
- Special power of Attorney for admitting execution.
- Power of attorney to collect debts.
- Power of attorney to sell shares.
- Power of attorney to execute a deed of sale.
- Power of attorney to prepare layout and sell plots.
- Power of attorney to raise money and mortgage property.
- Power of attorney to recover rents.
- Power of attorney to obtain letters of administration.
- Power of Attorney by a Company to its Branch Manager.
- Power of attorney by partners of a firm to one of them.
- Substituted power of attorney.
- Power of attorney to execute documents.
- Power of attorney to development of property by and in favour of developers.
- Power of attorney for development of property by the owner.