Why You Need a Power of Attorney for Property? Know everything with LegalKart

Why You Need a Power of Attorney for Property? Know everything with LegalKart

LegalKart Editor
LegalKart Editor
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Last Updated: May 19, 2024

A power of attorney for property is a legal instrument conferring authority upon someone to oversee your property and financial matters in the event of your incapacity to manage them independently. This document is essential for safeguarding your interests and ensuring that your affairs are appropriately managed in case of unforeseen circumstances. We’ll provide you with a comprehensive guide about it so that you will be able to get or make one when needed.


Understanding the Power of Attorney for Property

Imagine if something unexpected happened, like an illness or accident, and you couldn't handle your finances or make decisions about your property. That's where a power of attorney (POA) for property comes in handy. It serves as a safeguard, permitting a trusted individual to step in and manage your financial matters when you're unable to do so, ensuring they are appropriately handled.


Why Would Someone Need to Make a POA for Property?

Ensuring Management in Times of Incapacity

A power of attorney for property is essential. It ensures that trusted individuals can manage your affairs if you cannot. It provides reassurance that your financial matters and property will be handled effectively, even in unforeseen situations.

A Backup Plan for Unforeseen Events

Life's unpredictability highlights the need for a POA for property. Unforeseen events like illness, disability, or accidents can render you unable to manage your affairs. A POA serves as a contingency plan, enabling trusted individuals to take decisions on your behalf in such circumstances.

Protection of Interests and Wishes

Establishing a POA for property safeguards your interests and ensures your wishes are upheld. Whether managing finances, investments, or property, having a designated individual provides peace of mind, even in challenging times.


Types of Power of Attorney for Property

Various forms of Power of Attorney can facilitate property sale transactions, which include:

  • General Power of Attorney: Offers extensive authority to the agent to manage all facets of the property sale on behalf of the principal.

  • Limited Power of Attorney: It defines the extent of authority granted to the agent for particular tasks concerning the property sale, like signing sale documents or participating in closing proceedings.

  • Durable Power of Attorney: This document maintains validity even in the event of the principal's incapacitation, ensuring continuity throughout the property sale process.

  • Extraordinary Power of Attorney: It empowers the agent to execute specific acts or tasks pertinent to the property sale, as specified in the POA document.


Criteria for Choosing an Individual for POA

When choosing an attorney for property, it's essential to consider a few key criteria–

  • Age limit: The chosen individual must be at least 18 years old to fulfil this role. It ensures they have the legal capacity to carry out responsibilities and make decisions for the principal.

  • Trustworthiness: Prioritize choosing someone you trust completely to act in your best interests.

  • Reliability and Responsibility: Ensure the chosen individual is dependable, responsible, and capable of making prudent financial decisions on your behalf.

  • Availability and Willingness: Consider whether the potential attorney is available and willing to assume the role and is ready to fulfil the responsibilities associated with it.


How to Set Up an Attorney for Property?


  • Drafting the document:

    • The initial step involves creating the POA for Property Sale.

    • Drafting should comply with the Indian Registration Act of 1908 and the Powers of Attorney Act of 1882.

    • Specify powers granted to the attorney-in-fact, any limitations, duration, and conditions for revocation.

  • Execution of the document:

    • The document must be executed on non-judicial stamp paper, with appropriate stamp duty varying by state.

    • The principal signs in the presence of two witnesses, who also sign with full details.

  • Registration of the Document:

    • Advisable to register POA at the Sub-Registrar’s office for legal validity.

    • Registration fee varies by state.

    • Provide stamped and signed POA along with necessary documents.

  • Verification of the Attorney-in-Fact:

    • Verify identity and credentials of attorney-in-fact.

    • Ensure trustworthiness and competence.

    • Request identification documents and credentials.

  • Revocation of the Power of Attorney ?

    • It can be revoked by written notice to the attorney-in-fact.

    • Revocation should be registered at the Sub-Registrar’s office for validity.

    • Ensure the return of all original documents and funds received.


Responsibilities of the agent 

  1. Fiduciary Duty: Acting in the best interest of the principal (the person who granted the power of attorney).

  2. Managing Assets: Handling the principal's property and financial affairs prudently and responsibly.

  3. Record-Keeping: Keeping accurate records of all transactions and decisions made on behalf of the principal.

  4. Communication: Keeping the principal informed about important financial matters and decisions.

  5. Legal Compliance: Acting within the scope of authority granted by the power of attorney and complying with relevant laws and regulations.

Limitations of the agent

  1. Scope of Authority: Acting only within the specific powers granted in the power of attorney document.

  2. Conflicts of Interest: Avoid situations where the agent's personal interests conflict with the interests of the principal.

  3. Prohibited Actions: Refraining from actions that are explicitly prohibited by law or by the terms of a power of attorney.

  4. No Self-Dealing: Not using the principal's assets for the agent's personal benefit without explicit authorization.

  5. No Delegation: Generally, authority granted under the power of attorney is not delegated to another person unless expressly permitted.


Instances when a  Power of Attorney ends? 

  1. Expiration: If the power of attorney specifies an expiration date, it ends on that date.

  2. Revocation: The principal can revoke the power of attorney at any time, as long as they are mentally competent.

  3. Death: The power of attorney automatically terminates upon the death of the principal.

  4. Incapacity: If the principal becomes incapacitated and the power of attorney is not durable, it may terminate.

  5. Completion of Purpose: If the purpose for which the power of attorney was created has been fulfilled.

  6. Resignation or Removal: The agent can resign, or the principal can remove the agent if permitted by the terms of the power of attorney or by law.


Examples to illustrate the practical use of a POA

  1. Property Sale: Allowing a sibling to sell property when traveling.

  2. Financial Management: Assisting an elderly parent with bills and banking.

  3. Business Operations: Managing finances and contracts for a business partner.

  4. Healthcare Decision: Making medical choices for an incapacitated spouse.

  5. Long-Term Care: Organizing care for an incapacitated parent's needs.


How to Revoke a Power of Attorney ?

To revoke a POA, draft a written notice stating the decision, including the attorney-in-fact's name and the POA's start date. Deliver the notice via registered mail or personal delivery with a witness. Register the revocation at the Sub-Registrar’s office for validation and obtain a certified copy. Notify relevant entities like banks, collect original documents from the attorney-in-fact, update your records, and keep copies for reference.


Can Multiple Attorneys Be Appointed for a Property?

Yes, it's possible to appoint multiple attorneys for property. You can choose to have them collaborate, meaning they must make decisions together and reach a consensus on any actions to be taken. Alternatively, you can appoint them severally, allowing each attorney to act independently and make decisions without the need for input from the others. The decision between appointing joint or several attorneys hinges on your preferences and the unique circumstances of your situation.

Some Interesting Cases And Judgments To Understand It Better:


Ghanshyam v. Yogendra Rathi case:


In a real estate dispute, Ghanshyam attempted to transfer property via power of attorney. However, recipient Yogendra Rathi encountered obstacles due to unclear paperwork and Ghanshyam's lack of explicit consent. This highlighted the importance of clarity and proper documentation in the power of attorney transactions, leading to a June 6, 2023, Supreme Court ruling.



The Supreme Court clarified that powers of attorney cannot independently transfer property rights. It emphasized the necessity for clear consent from the principal and execution of requisite paperwork by the attorney-in-fact for validity.


This ruling addresses the legal ambiguity surrounding power of attorney agreements in real estate transactions. It emphasizes the principal's role in authorizing actions outlined in the power of attorney, providing clarity and guidance for future transactions.


Daulat Ram Dharam Bir Auto Private ... vs Pivotal Infrastructure Private


In the case of Daulat Ram Dharam Bir Auto Private vs. Pivotal Infrastructure Private, the petitioner group discovered on September 30, 2013, that respondent No. 1 was misusing the power of attorneys. These documents granted authority to liaise with government departments and execute transactions. Allegedly, respondent No. 1, through Kapil Minocha, unlawfully transferred project land to themselves using the misused power of attorney.


On April 27, 2023, the Delhi High Court ruled on the case. It determined that a power of attorney misused by respondent No. 1 was not authorized for transferring rights to the land. Consequently, the court held respondent No. 1 responsible for illegal and fraudulent sale deeds executed through this misuse of power of attorney.


This judgment reminds us to carefully review power of attorney documents to prevent misuse. It stresses the necessity of proper authorization and documentation to ensure the legality of transactions. Additionally, it highlights the legal ramifications for individuals or entities found guilty of exploiting the power of attorney privileges for fraudulent purposes.


Tips to Consider

  • Choose your attorney wisely, ensuring they handle financial matters responsibly and prioritise your best interests.

  • Store your POA document securely for easy access, such as in a filing cabinet or safe deposit box.

  • Update your POA regularly to reflect changing life circumstances or relationships and ensure it accurately represents your wishes for managing your affairs.



A power of attorney for property offers peace of mind, as it ensures someone you trust can handle your affairs if you're unable to do so. By understanding its importance and taking the necessary steps to set one up, you're ensuring that your financial matters and property are taken care of according to your wishes, even in the face of unexpected events or circumstances. Don't wait until it's too late – take action now to protect yourself and your assets with a power of attorney for property. If you need any kind of legal consultation, don’t look beyond LegalKart. Here, you will get help from professional lawyers, 24*7, and that too in your language.

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