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General power of attorney has no legal sanctity: SC

                                                                                                                                             October 12 2011

The Supreme Court today ruled that sale transactions carried in the name of general power of attorney will have no legal sanctity and immovable property can be sold or transferred only through registered deeds.

A three-judge bench of justices R V Raveendran, A K Patnaik and H L Gokhale also asked the states to reduce stamp duty rates to prevent undervaluation of property and stashing of black money by vested interests.

The apex court said high stamp rates has led to rampant abuse of the general powr of attorney (GPA), sale agreements (SA) and Wills, resulting in huge loss of money to the exchequer.

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“Transactions of the nature of `GPA sales¿ or `SA/GPA/WILL transfers' do not convey title and do not amount to transfer nor can they be recognised or valid mode of transfer of immovable property.

“The courts will not treat such transactions as completed or concluded transfers or as conveyances as they neither convey title nor create any interest in an immovable property.

“Such transactions cannot be relied upon or made the basis for mutations in municipal or revenue records,” Justice Raveendran, writing the judgement, said.

The apex court said the amendments to stamp and registration laws by various states do not address the larger issue of generation of black money and operation of land mafia and hence there was a need to reduce the stamp duty though it may result in loss or revenue.

“When high stamp duty is prevalent, there is a tendency to undervalue documents even where sale deeds are executed.

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Comments
9 years ago Shankar Balasaheb Dhumal

If exchequer get full consideration of his property then ?


10 years ago POKALA VENKATA VAMSEEMOHAN

special leave petition No.13917/2009 supreme court suraj lamps VS state of haryana


10 years ago rajendra rao

Can someone post whole judgement or atleast case no. for tracing full judgement.


10 years ago haroon Basha

is there any law or documents deals with signature. like it should be signed where it mandatory whether in ink or thumb impression etc. kindly guide for more clarity on this haroon


10 years ago slakshmanrao

In the matters relating to Self Earned Property,Legal route may still have the merit, till such time, the legalheir/successsion certificate(s)are in process..This needs special attention...


11 years ago Rasik Dagli

This is an eye opener for those are doing illegal Property Transactions by General Power of Attorney.All Lawyers should also advise their clients that they should not do such transactions.


11 years ago dr g balakrishnan

property sellers and buyers should not shy away from paying reasonable fees to property advocates is my opinion, after all there is a lot of cross checks in property checks!


11 years ago dr g balakrishnan

Anyway I FULLY ENDORSE THE CONSTITUTION BENCH VIEWS!


11 years ago dr g balakrishnan

Advocates in transfer of property cannot take things for granted at all, but they do as clients want cheap advocate fees.. some thing like Rs.1000/- or so! Property costs more than one crore!


11 years ago dr g balakrishnan

i had handled such documents but i searched the reasons why party is not present that revealed the clandestine ideas of sale! i rejected such sales. some clients got annoyed with me!


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