Important things to know about Power of Attorney

Normally, power of Attorney is issued by anyone who cannot do transactions in person for various reasons, such as: 

• Not being present for the transaction due to living abroad

• Illness and being bedridden

• Being elderly and having health problems

• Any other reason for being unable to carry out the transaction in person

Types of Power of Attorney 

GPA can either be given for all the stated matters, or for any one category, like only property matters or only banking matters. The scope of this type of power is very wide, which may make it risky if the Attorney is not a trustworthy person. However, the general POA benefits the buyer and seller to avoid the stamp duty rate, capital gains, or taxes imposed by the government on any transaction related to property.

1. General Power of Attorney

The General Power of Attorney (commonly termed as GPA) is when you give another person a general right or power to act lawfully regarding your property, bank accounts or tax payments, registration work, or to sue a third party. The word general means that the power should be general regarding the matter, but not general regarding powers in respect of a subject matter.

2. Special Power of Attorney

The Special Power of Attorney is a special power, which means it is only granted for specific tasks or work. Once the specific task has been completed, this power of attorney ends. This power can be authorised to sell, buy, rent, recover debts, file tax returns, open and close bank accounts and appear only on behalf of the Principal in legal matters. It is not restrictive, however only one act among the ones mentioned above can be performed. A special power of Attorney cannot be made for many acts. If you want to issue a power for many acts, a special power of Attorney should be issued for each act separately.

3. Durable and Non-durable Power of Attorney

Typically, a power of Attorney ends when the Principal dies. However, if the Principal wishes for the power of attorney deed to endure even after their death, they need to mention it in the original deed which they issued. This kind of power of Attorney is called Durable Power of Attorney. If the Principal does not mention that the power should continue even after the death of the Principal, it is called a Non-durable power of attorney deed. Normally, all power of attorney deeds is considered non-durable and ceases with the death of the Principal, unless the Principal specifies that they want the dead to persist after their death.

How to issue a Power of Attorney in India: 

The minimum requirement for issuing a power of Attorney is that the parties involved should be minimum 18 years of age, have a sound mind, and not be declared insolvent by the court of law.

To register for a POA in India, the process is as follows:

1. The power of Attorney is drafted, along with the signature of the Principal and two witnesses. It is worthwhile to have a draft prepared by a legal expert.

2. The draft and the stamp paper should be authenticated by a sub-registrar. However, in some cases, the draft is verified by a notary.

3. Once the draft is authenticated, the sub-registrar office fixes a date for the registration of the POA instrument.

4. On the date of registration, both the Principal and the two witnesses should be present for the attestation of power.

5. Lastly, a government registration fee is paid in the sub-registrar office.

6. The registration process will be completed after a week, then the POA can be collected from the office.

When drafting the POA, certain clauses should be included. These are:

1. Details of the Principal and the Attorney, including name, age, address and occupation. 

2. A legally valid reason for granting the power of Attorney

3. The date and place of drafting the POA deed, as well as the date from which it will start

4. The date till the POA will be valid, with a specific time of termination. If no exact date is included, the POA should mention whether the deed is durable or non-durable

5. If it is a GPA, then all the acts and areas of granting power should be clearly specified. Also, if any particular area is not to be covered by the Attorney, then that should be mentioned as well. For example, in matters related to property, the Principal can grant the power to buy and rent property but may not allow the selling of property.

6. If it is a special power of Attorney, the specific act or task needed to be completed must be clearly mentioned, as well as the time limit within which the act is to be done.

There are certain documents required to register for POA, which depend on the state government guidelines. It is advisable for the parties involved in the POA to refer with local authorities to confirm which documents are needed in their particular states and cases. The basic documents required are:

1. A copy of voter ID to verify address

2. A copy of POA deed document

3. Passport size photograph of the parties involved

4. Aadhar card photocopy

5. Proof of ID of the two witnesses

POA By Non-Resident Indians (NRI)

An NRI can make a POA deed despite staying outside India. Many NRIs have properties and banking matters in India which may require their presence for transactions. Through POA, NRIs can give the powers of transaction to another person who is residing in India. The procedure for NRIs to make a Power of Attorney deed is:

1. Draft the POA in print on paper and sign it.

2. Get the draft stamped and sealed from the Indian Consulate or Embassy in that country. Alternatively, a Public Notary in the respective country can notarise it by stating the notary registration number on every page of the document on the seal.

3. Post the attested deed to the Indian address in the name of the Attorney. 

4. The Attorney in India should register the draft at a sub-registrar office by paying the appropriate registration charges. 

Some important facts about POA

• A POA that has not been executed correctly has no value.

• A POA needs to be authenticated to certify the mental soundness of the Principal at the time of signing.

• Registering a POA in India is not compulsory. However, it is advisable because a registered POA adds to the legal value. However, it is compulsory to register a POA if it relates to transferring immovable property.

Taking the help of a lawyer for a Power of Attorney

The process of drafting a POA is complex and time-consuming. Hiring a lawyer is advisable since they can help draft and register a POA smoothly, with the correct clauses and sections. Typically, a documentation lawyer can help with drafting a POA. A lawyer would ensure that safeguards are included to ensure safety from adverse actions by the Attorney. A lawyer would make sure that the entire procedure is hassle-free.

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