Answered question

Dear Sir,

You must be very careful as you are dealing with NRI. You must be aware that since 2011 the Supreme Court not recognizing GPA transactions.

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No property sale on power of attorney: Supreme Court

Property sales through the common practice of general power of attorney (GPA) will not give ownership title to the buyer.

In a landmark judgment that is expected to send a large number of property owners into a tizzy, the Supreme Court held that the GPA method of immovableproperty sales is not a valid form of transfer of property.

A three-judge bench presided over by Justice R. V. Raveendran said that property can be lawfully transferred only through registered sale deeds.

"A power of attorney is not an instrument of transfer in regard to any right, title or interest in an immovable property," the bench said, after interpreting various provisions of the law concerning property sales. However, the bench said the judgment will not affect "genuine transactions" under the GPA.

The judgment delivered on Wednesday would have an impact on both freehold and leasehold properties and affect the mode of transfer of property in Delhi and the National Capital Region (NCR) where GPA sales are very common. Even though it can cause some hardship to those who have already purchased property through the GPA, the order will help curb evasion of duties, flow of black money into real estate and also save people from being cheated by unscrupulous owners selling the same property to several people.

• Flat sold by builder to third party whem my Agreement to sale was valid

I had executed a Agreement to sale on one flat at Agra U.P. in (date) with a validity of 15 months ,after 15 months the builder with mutual consent and reason that the the construction work is not over renewed it for another 12 months upto  (date),again with the same reason it sought and extension of another 6 months of agreement to sale which was made and agreement to sale was extended upto (date).

After this we issued a notice to the builder and on reply to notice the builder through its legal counsel sought again time upto (date).Subsequently again a notice was given on (date) to execute the sale deed but the builder again replied by letter and sought extension upto (date) with the same reason that flats are incomplete.After (date) the builder is untraceable and recently he was arrested on forgery charges and currently in jail.On enquiry I came to know that the builder sold my flat that was having valid agreement to sale to third party with sale deed date.During this period my agreement to sale was valid but now builder is in jail what is the legal remedy and the party having sale deed has occupied the flat .now what is the legal remedy me to get my flat back.

Section 53A in The Transfer of Property Act,

1[53A. Part performance.—Where any person contracts to transfer for consideration any immoveable property by writing signed by him or on his behalf from which the terms necessary to constitute the transfer can be ascertained with reasonable certainty, and the transferee has, in part performance of the contract, taken possession of the property or any part thereof, or the transferee, being already in possession, continues in possession in part performance of the contract and has done some act in furtherance of the contract, and the transferee has performed or is willing to perform his part of the contract, then, notwithstanding that 2[***] where there is an instrument of transfer, that the transfer has not been completed in the manner prescribed therefor by the law for the time being in force, the transferor or any person claiming under him shall be debarred from enforcing against the transferee and persons claiming under him any right in respect of the property of which the transferee has taken or continued in possession, other than a right expressly provided by the terms of the contract: Provided that nothing in this section shall affect the rights of a transferee for consideration who has no notice of the contract or of the part performance thereof.]

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Sec 202 of Indian contract act says irrevocable GPA cannot be cancelled as it is executed for consideration.

Section 202 in The Indian Contract Act, 1872

1. Termination of agency, where agent has an interest in subject-matter.—Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest. —Where the agent has himself an interest in the property which forms the subject-matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of such interest." Illustrations

(a) A gives authority to B to sell A’s land, and to pay himself, out of the proceeds, the debts due to him from A. A cannot revoke this authority, nor can it be terminated by his insanity or death. (a) A gives authority to B to sell A’s land, and to pay himself, out of the proceeds, the debts due to him from A. A cannot revoke this authority, nor can it be terminated by his insanity or death."

(b) A consigns 1,000 bales of cotton to B, who has made advances to him on such cotton, and desires B to sell the cotton, and to repay himself out of the price the amount of his own advances. A cannot revoke this authority, nor is it terminated by his insanity or death. (b) A consigns 1,000 bales of cotton to B, who has made advances to him on such cotton, and desires B to sell the cotton, and to repay himself out of the price the amount of his own advances. A cannot revoke this authority, nor is it terminated by his insanity or death."

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Govt tightens power of attorney rules

CHENNAI: The Tamil Nadu registration department has tightened the noose around realtors using power of attorney (POA) for fraudulent land deals. Power of attorney authorizes a person to carry out transactions or act legally on behalf of another.
Under the new rules, a power of attorney holder seeking to carry out a land transaction will have to provide documentary evidence to the sub-registrar to prove that the principal, the person who issued the power of attorney, is alive. The principal has to obtain a "live" certificate with his photograph affixed to it from a registered medical practitioner or a gazetted officer. These certificates are valid for 30 days.

As per a recent order of the inspector general of registration, the new rules are applicable to all POAs registered from February 4. By law, POA is not valid once the principal dies. Section 34 of Tamil Nadu Registration Act says it is the duty of the sub-registrar to ascertain whether the POA holder has the right to execute a transaction on behalf of the principal. But sub-registrars register property documents without bothering to verify whether the principals were alive.
"In Tamil Nadu, where a large number of land transactions are carried out on the basis of POAs to circumvent payment of stamp duty and registration fees. Many instances have been reported of POA holders selling land after the death of the principal. Buyers get into trouble when legal heirs of the principal claim rights over the property. Such cases end up in protracted legal battles and ultimately the sale deeds are declared invalid," said a senior official.
There have been instances of people impersonating land owners and executing fraudulent POAs. In one case, land worth 9 crore on Venkatnarayana Road was sold to a business group based on a POA, reportedly executed by the land owner in 2008. Legal heirs of the land owner subsequently filed a case of forgery against the business group, brokers and others involved in the deal as the owner had died 28 years earlier. When police refused to take prompt action, the owners moved the court.

As per law, the principal also has the right to rescind a POA. "If there is a mention of a consideration (amount) in the POA, the holder can claim that money through legal means. But he cannot claim rights over the property once the POA is rescinded or the principal dies," said the official.In 2010-11, more than 3.75 lakh POAs were registered across Tamil Nadu for property-related transactions. The number came down to 1.8 lakh last year. It is going up again this year, said the official.