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Simar Nagi | 15 Nov 2022

A Quick & Simple 5-Minute Guide to the Power of Attorney Act

A Quick & Simple 5-Minute Guide to the Power of Attorney Act

Table of Contents

  1. Power of Attorney Act : A Brief
  2. Types of Power of Attorney
  3. Essential Clauses of the Power of Attorney Act
  4. How Do You Get a PoA Done If You’re Outside India?


The Power of Attorney Act 1882 governs a "Power of Attorney," a legal agreement allowing one person to act on behalf of another.

In India, the Power of Attorney Act was enacted in 1882 to govern the creation and registration of powers of attorney. The Act outlines the prerequisites for a legal power of attorney, thereby allowing for the registration of powers of attorney under the Registrar of Companies.The Power of Attorney Act can be used for various purposes, including property transactions, legal matters, and financial affairs.

Understanding the POA Act can be problematic initially. Hence, we’ve come up with this blog to simplify the information around the Act in India. Continue reading and discover yourself. 


Power of Attorney Act : A Brief

The POA Act allows a person to appoint another person or organisation to manage their affairs (property, medical care, and finances) on their behalf. 

The person who grants another person permission to act on their behalf is often referred to as the "principal," "donor," or "grantor" in such an arrangement. The person who receives powers is known as an agent or power of attorney holder.

This Power of Attorney Act PDF will give you a better outlook on the registrations, executions, deposits, and payments under the power of attorney. 

Also Read: Understanding the 7/12 Extract and Its Legal Importance


Types of Power of Attorney

1. General Power of Attorney

GPA states that a person can provide another person with an unrestricted right to act lawfully concerning his/her property, bank/tax payment, or registration to sue the third party. 


2. Special Power of Attorney 

Special Power of Attorney or SPA is primarily done when one wants to appear for property registration. The special power of attorney is automatically dissolved when the job is finished.  


3. A Durable Power of Attorney

A durable power of attorney is generally used to allow an agent to manage all affairs of the principal. DPO doesn't have a collective fundamental measure, and it comes into  effect immediately in the event of the principal's disability. This type of power of attorney doesn't  expire at the time of the principal's death. 


4. Non-Durable Power of Attorney 

The non-durable power of attorney is only used as a temporary measure in one-time transactions where the principle gives the agent permission to act on their behalf. The non-durable power of attorney is terminated once a specific transaction has been completed. 

NOTE: If the POA is durable, it will remain in force even if you become incompetent and unable to manage affairs on your own for an extended period of time. In the case of "non durable" PoA, they expire when the principal suffers a considerable decline in mental capacity.


5. Medical Power of Attorney 

This type of power of attorney is mainly used for health-related decisions. The medical power of attorney cannot be exploited; e.g- The medical PoA can pay the bill but not decide whether to turn off the life support system if any medical emergency situation arises. 

Also Read: Fractional Ownership: Meaning and Its Impact on the Commercial Real Estate World


Essential Clauses of the Power of Attorney Act

  • The details related to the name, age, address, and occupation of the person appointing an attorney should be mentioned. 

  • The details of the person to whom the power is granted should be mentioned.

  • The time, date, and place where the power of attorney deed is being generated and the start date when a power of attorney will come into effect should be mentioned in the clause. 

  • The date of termination is when the facility of the attorney's deed will expire if the deed is limited by time. 

  • All acts and circumstances surrounding its granting should be explicit if a general power has been conferred. It should be made clear if the attorney is prohibited from performing any specific act in any given situation.

  • If any particular task is to be done by an attorney, then it should be mentioned. Moreover, the time limit within which it should be performed must also be specified. 

Also Read: Everything to Know About The Model Tenancy Act


How Do You Get a PoA Done If You’re Outside India? 

A power of attorney should be executed at the sub-registrar's office. If a person lives outside of India and wants to buy a property, they can use POA in the following ways:

Legalisation: The Indian Embassy or Authorised Consulate's agent must validate the judge or notary's signature before the POA is signed or executed.

Additionally, this POA must be stamped in India three months after the date of receipt. When the document is produced in India for registration, the stamp duty on the POA should be paid. The stamp duty on power of attorney is paid as per Section 2(17) of the Indian Stamp Act of 1899, as read with Schedule-I.

Also Read: A Guide to the Maharashtra Stamp Duty Act


Apostille: The Hague Convention authorises the use of the apostille process for proving a power of attorney signed outside of India. It is a certificate that helps verify and confirm the signature of the person who authorised the document and complies with Indian laws like the Indian Registration Act of 1908 and the Power of Attorney Act of 1882.  


Conclusion 

There is one important thing to always keep in mind- the POA grants agents the powers to perform acts in the absence of the grantor, but the POA cannot grant power to the agent if there is a disagreement with the law governing people and companies.

Nonetheless, the POA is a sure-shot way to speed up the process of medical, financial, and real estate transactions and ensure proper execution even when away. Hence, it’s good to have POA, as it provides you with both convenience and protection.

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