Noose to tighten on misuse of POA for land deals
Nov 11, 2013
Source : The Times of India

 

MUMBAI: The central government will tighten the noose on individuals using the power of attorney (POA) for fraudulent land deals. The POA authorizes a person to carry out transactions or act legally on behalf of another.

Under the proposed amendment to the Indian Registration Act, 1908, a POA holder seeking to carry out a transaction (land or otherwise) will have to provide documentary evidence to the sub-registrar to prove the principal (who issued the POA) is alive. The principal has to obtain a ‘live’ certificate with his photograph affixed from a registered medical practitioner, which is valid for 30 days.

Stamp duty experts said the amendment, pending with Parliament, will curb frauds relating to misuse of the POA.

“It’s a good suggestion as many land transactions are carried out on the basis of POA to circumvent payment of stamp duty and registration fees. Many POA holders sell land after the principal’s death. 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 sale deeds are declared invalid,” said stamp duty expert Rajesh Mehta of Raha Realtors.

Another amendment pertains to Section 17 of the act. The government said all agreements, or contracts for sale of immovable property, including developers’ or promoters’, have to be registered.

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