Real Estate

Power of attorney to be mandatorily registered

Shishir Sinha New Delhi | Updated on June 03, 2013

Law changes planned to curb disputes, stamp duty evasion

The laws on property deals through a power of attorney (POA) — a legal document that empowers a person to act on behalf of another — are all set to get tougher. The government is planning to amend the laws to make registration mandatory for such deals.

Century-old Act

This will be among the amendments sought to be made to the more-than-a-century-old Registration Act, 1908. The Act, under the purview of the Department of Land Resources of the Ministry of Rural Development, prescribes norms for registration of property and wills as also other kinds of deeds and documents.

“The Cabinet may take up for consideration the proposed amendments to this Act on Tuesday. This includes a proposal to make compulsory registration of POA authorising transfer of immovable property with or without consideration,” a senior Government official told Business Line.

He also said that compulsory registration will bring property transactions executed through POA into the ambit of the registering authorities. This will reduce the disputes related to such transactions. It will also ensure full realisation of stamp duty to States and Union Territories. Property dealing through POA is rampant in many States, giving rise to disputes.

Deals through POAs are done on the basis of notarised documents. This is considered sufficient to authorise an individual or a firm to use the immovable property, but neither can become an owner in the true sense. This is done to avoid stamp duty since registration of the sale deed involves payment of stamp duty according to the circle rates.

Another amendment being considered is to empower sub-registrars, the zonal level registration authority, to refuse transfer of properties in certain cases.

Unauthorised transfers

Such prohibition on unauthorised transfer of properties includes those whose transaction is prohibited under State specific laws or properties that have been attached by courts or other authorities. “Such a provision will reduce the disputes and will ensure that such properties stay with the rightful owner,” the official added.

One of the current provisions of the Act makes it mandatory to register the adoption of a son. Now, in order to provide gender equality, it is proposed to substitute the word ‘son’ with ‘son or daughter’, thereby bringing in female adoptions also into the purview of the Act.

> shishir.sinha@thehindu.co.in

Published on June 03, 2013

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