Power of Attorney (POA) is a powerful document that has much significance in legal issues. It is a document of authorization recognized by law, which gives the power to an individual to choose another being to carry out his actions on his behalf. The person appointed holds the legal power to act in circumstances and situations without being questioned by any authority.
Power of Attorney could be used in various verticals such as business, finance, legal issues, private affairs, insurances etc. The person appointing a representative may not be necessarily into a legal profession. Similarly, the representative will be effective immediately after signing the document. Mostly POA can be seen in cases of finance and real estates.
A power of attorney can be prepared by considering two factors i.e. the person in authority and representative. The representative has to act in accordance with the power allotted to him. There can be limitations to these powers or clauses involved which has to be followed strictly. When it comes to the person in authority, he has the power to decide how much authority he wishes to handover to another person. He could also assign a timeline up to which he wishes to hand over the power.
Types of power of attorney:
There are two kinds of POA on the basis of activity, time and authority.
- Special POA
These POA’s are documented when there are special cases. They are usually carried out for a shorter time period allowing only a small handover when it comes to the power of execution. A representative can perform only very specific activities.
- General POA
General POA’s are documented when handover is for a longer run. Here the representative has the most power to execute his decisions and perform all the activities with respect to the law.
POA and Non-Resident Indians (NRI)
NRI is one of the largest sectors that invest in real estate. NRI shows great interest in buying properties in India, as the INR is comparatively cheaper when compared to foreign currency, which provides convenience to them. Though, for investment, they might not be physically present to take care of procedures and finances such as registration of the properly, looking for loans, finalizing the real estate agent etc.
In that case, they use could Power of Attorney to get their job done. POA can be made prepared on a plain paper or some people might prefer on a stamp paper. The NRI can use a notary service for document preparation, which has to be signed and attested by an officer. It is always advisable to get it attested by an Indian official for better credibility. Once the document is ready and attested it could be filed for registration or adjunction.
This POA allows the representative to perform the following tasks when it comes to real estate sector i.e. purchasing the property with complete paperwork, applying for a home loan (if required), rent execution and look after any matter that concerns with the property.
How to register a POA?
It is very important to register the power of attorney, which requires an individual to follow a set procedure. NRI could send the document to India. In order to register, the POA should be posted to registrar’s office for acceptance. It will keep the document safe and prevent any illegal acts such as making alterations in the document or misusing the documents. There might be few charges applicable towards the stamp duty. These charges vary in every state. In case there is a demand for validation or authenticity, a copy of can be requested from the registrar’s office.