Original PoA not needed, copy enough to sell property: Supreme Court [31.1.2022]

31.1.2022, Monday

NEW DELHI: In a big warning to property owners who intend to sell their assets through a power of attorney (PoA) holder, the Supreme Court has ruled that the PoA holder can sell the property and register the sale by merely producing a copy of the PoA and that the original was not mandatory for registration of the sale.

This means, if the property owner orally cancels the PoA and takes back the original document without entering into a written agreement on cancellation of the PoA, it would still allow the PoA holder to sell the property or land with the help of a copy of the original PoA document.

A bench of Justices K M Joseph and P S Narasima said, "On an analysis of the provisions (of the Registration Act), we have no hesitation in rejecting the argument of the plaintiff that the non-production of the original power of attorney by the second defendant was fatal to a valid registration being effected."

In the case in hand, the owner of the property (plaintiff) had entered into an agreement with a person for sale of his land for Rs 55,000 in 1987. As he was transferred out of the place, he executed a PoA for concluding the sale. The sale, however, didn't materialise. So, he took back the original PoA and told the person that the PoA stood terminated. But the erstwhile PoA holder applied for a copy of the registered PoA and went ahead with the sale for Rs 30,000 to the same defendant, who had earlier agreed to buy it for Rs 55,000. He went to the Registrar's office and got the sale registered with a copy of the PoA. The Himachal Pradesh high court cancelled the registration of the sale saying non-production of original PoA document was fatal to the sale and restored the property to the owner.

01 Feb 2022