The Power of Attorney: Crucial Information for NRIs

Managingapropertyinone'snativecountrymightbedifficultforNon-Resident Indians(NRIs).APowerofAttorney(POA)canbecreatedtoavoidthedistancefrom becomingabarrier.Betterpropertymanagement&convenienceofdoingbusiness aremadepossiblebyit.outlinesafewimportantguidelinesthatyoushouldbearin mindwhencompletingapowerofsolicitor.

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Apowerofattorney(POA)isalegaldocumentthatappointsanattorneyorperson toactonbehalfoftheprincipal,whoistheowneroftheproperty.Intheabsenceof theowner,theinstrumentgivesthesolicitorauthoritytomakesignificantchoices. Here,theattorneymaybeanyonethemainchooses,includingafriend,relative,real estatelawyer,orpropertymanager.ThearrangementworksbestforNon-Resident Indians(NRIs)whoareunabletophysicallymanagetheirrealestateintheirplace oforigin.

There are typically three different forms of powers of lawyers (POAs). They consist of:

General power of attorney

AgeneralPOAgivestheattorneyextensiveauthoritytohandleimportantissues whiletheprincipleisaway.Theseabilitiesincludemanagingmoney,purchasing insurance,writingchecks,filingtaxes,resolvingdisputes,andbuyingandselling realestate.

Durable power of attorney

Unlesstheprincipalexpresslyrevokesit,thedurablePOAisstillineffectforthe durationoftheprincipal'slife.However,aspecialphrasecanbeincludedtothePOA intheeventthattheprincipalisunwell,sayingthattheattorney'spowerwouldbe lawfuleveniftheprincipalweretobecomephysicallyormentallyincapable.

Special power of attorney

Therightsofthesolicitorarerestrictedtoonespecificpurposeundersucha contract.Task-specificSpecialPOAexpireswhenthetaskisfinished.Forexample,if thePOAincludestherighttorent,theattorney'sauthorityisrestrictedtorenting outthepropertyexclusively.

Information that NRIs should consider before signing a power of attorney Execution

ThePOAcanbeexecutedwithouttheNRIprinciplebeingpresentinIndia.Through theIndianembassy,aPOAcanberegisteredinthenationwherethebeneficiary resides.BothlegalizationandapostalizationareoptionsforPOAregistration outsideofIndia.

Legalisation

APOAmustbenotarizedbyanauthorisedofficeroftheIndianConsulateor Embassy,inaccordancewithSection3oftheDiplomatic&ConsularOfficers(Oaths andFees)Act,1948.Also,thePOAmustbestampedwithinthreemonthsoftheday itwasreceivedinIndia.WhenthedeedisbroughtforregistrationinIndia,stamp

dutyischarged.TheIndianStampActof1899'sSection2(17)Schedule-Ispecifies howthepaymentwouldbepaid.

Apostalisation

APOAmayalsobecarriedoutoutsideofIndiathroughtheapostalization procedure,whichiscontrolledbythe1961HagueConvention.Here,anapostille certificateisneededtoconfirmandvalidatethesigner'ssignatureonthedeed.The PowerofAttorneyActof1882andotherIndianlegislation,suchastheIndian RegistrationActof1908,shouldbefollowedbythedeed.Moreover,stampdutyis incurredwhenthedocumentisreceived.

How is a POA carried out in India?

AnNRIinIndiaispermittedtosignthePOAattheSub-office.Registrar's Nonetheless,thePOAmustbewrittenonpaperwithanon-judicialstampofRs100. Thedeedwouldalsoneedtobesignedbytwoattorneysandtwowitnesses.All participantsshouldhavecurrentIDswithphotos.Afterthedeedissigned,thePOA takes4-5daystoarrive,accordingtoanNRIRealtypropertyexpert.

Registration

AccordingtotheIndianRegistrationActof1908,thePOA'sregistrationisoptional. But,ifapowerofsolicitorisusedtosellanimmovableasset,itmustberegistered, accordingtoaSupremeCourtofIndiadecision.Thesub-officeregistrarslocatedin theregionwherethesolicitorresidesiswherethedeedshouldberegistered.

Revocation

APOAisonlyvalidwhiletheprincipalisstillalive.But,ifnecessary,theprincipal mayrevokeorrescinditatanytime.Moreover,thePOAisvoidiftheprincipalis deemedinsaneorinsolvent.TheprocedureforcancellingaPOAisthesameasthe procedureforcarryingitout.Inthepresenceoftwowitnesses,thedeedmaybe revokedintheSub-office.registrar's

Accountability

Theprincipalwouldnotbeliableifadisputearoseasaresultoffraudcommittedby theattorney.Nonetheless,ifitbecomesnecessary,theprincipalwillhaveto demonstratetheirignoranceofthesituationincourt.

Also,itissignificanttorememberthatthestampdutyleviedinIndiavaries dependingonthestateandthesolicitorchosen.Thus,keepupwiththestandards governingpowersofsolicitor.Forinstance,dependingonthesolicitor,thestamp chargeforageneralPOAvariesgreatly.ThestampdutyinthiscaseisRs500ifthe solicitorisacloserelative,suchasaspouse,father,mother,wife,child,orbrother. Ontheotherhand,adifferentstampdutyisassessedifthePOAisgiventosomeone otherthantheimmediatefamily.Itiseithertheconsiderationoreventheproperty's marketvalue,dependingonwhichishigher.

Ingeneral,usingapowerofsolicitortomanageanestateinIndiaissimpleand straightforwardforNRIs.Regulatingtheattorney'sauthorityisessential, particularlyifitisapropertymanagerorevenadistantrelative.

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