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POWER OF ATTORNEY
A Power of Attorney means the power or authority given to a person (agent) by an
individual (principal) to act on his behalf or on behalf of a group of individuals in business
matters or any other matter.
It plays a vital role in transferring the lawful ownership of immovable property like land,
building, water source, from one person to another. The person who holds the power is called
the Power of Attorney Holder. He is employed by the principal to take care of his dealings
with third persons.
A person competent to contract can execute a power of attorney. He can appoint one person
or several persons to act on his behalf. Where several persons are appointed as attorneys, it is
advisable to mention as to how they will act jointly or independently. If this is not mentioned,
then they are at liberty to act jointly.
Power of Attorney, generally speaking, is of two types. Power of Attorney for a single
specific purpose is known as "special power of attorney" and the one involving more than one
work or transaction is called "General Power of Attorney."
The duration of a special power of attorney may be for a particular period or for an indefinite
period until the task is completed. A general power of attorney may continue to be in force
until it is revoked or by death of either party. A registered power of attorney can be revoked
by a cancellation deed.
Though, in general, a power of attorney is revocable, it cannot be done so in matters
pertaining to debt security till the debt is cleared even though the debtor is not alive. It can be
revoked if the principal becomes of unsound mind or he is declared insolvent. It cannot be
revoked if it is made irrevocable. However it should be registered by paying applicable stamp
duty.
Power of Attorney attracts various provisions of The Indian Stamp Act, Powers of Attorney
Act, Registration Act, The Indian Contract Act, and Indian Partnership Act, and The Indian
Evidence Act.
A power of attorney is divided into ten categories according to the stamp duty payable.

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It is significant to note that a power of attorney by a promoter to a builder for construction of
apartments under flat ownership scheme, attracting stamp duty according to the value of the
property, has been added by an amendment to the Stamp Duty Act. In Karnataka, presently
stamp duty is 2% plus registration charges 2% for the promoter GPA.
A power of attorney is given for a court case, for appointing one attorney in place of another,
for collection of debts and for admitting execution, and a general power of attorney is given
for selling shares, to execute a sale deed, to prepare a layout and sell plots, to raise money
through mortgage of property, to recover rents and many other acts.
A power of attorney need not be registered except where an immovable property is involved.
According to the Registration Act if, a power of attorney gives power to present documents
for registration, then it must be executed before and authenticated by the Registrar or the
Sub-Registrar.
If the Registration Act is not in force at a place where the executants lives, then a Magistrate's
authentication is necessary.
If the power of attorney is registered outside India a Notary Public, any Court Judge,
Magistrate of that country, or Indian Consul or Vice-Consul or a representative of Central
government must authenticate it.
A power of attorney is executed in the form of a legal document generally in the first person
and begins either as "Know all men by these presents that I..." or "By this power of attorney
I,...".
After a brief introduction, the operative part is brought in. Thereafter, the specific powers
given to the person are mentioned in separate paragraphs. After these a general clause is
added empowering the attorney to do such lawful acts and deeds, as he deems fit and proper
in the performance of his duties.
It is the duty of the agent, the power of attorney holder, to act honestly and faithfully on
behalf of his principal, the giver. He is legally bound to perform the tasks according to the
wishes of the principal. If the agent acts otherwise and the principal suffers any loss, he must
compensate the principal. He is bound to keep all accounts in a proper manner and produce it
to the principal on demand.
An agent possessing authority to carry on business has authority to do every lawful thing
necessary for the purpose.

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Being a legal document, a power of attorney must be strictly interpreted and understood.
Therefore special care must be taken while drafting the clauses.

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