DRAFTING OF DEED OF POWER OF ATTORNEY

FINAL DRAFT SUBMITTED IN FULFILLMENT OF PROJECT FOR THE SUBJECT

DRAFTING, PLEADING AND CONVEYANCING

BY

AMAN ADITYA

(Roll No.- 1204, 8th Semester, B.B.A LL.B (Hons.))

SUBMITTED TO

Dr. B. Ravi Narayan Sarma

CHANAKYA NATIONAL LAW UNIVERSITY

PATNA

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 ACKNOWLEDGEMENT

The present project on “Drafting, Pleading and Conveyancing” has been able to get its final
shape with the support and help of people from various quarters. My sincere thanks go to all the
members without whom the study could not have come to its present state. I am proud to
acknowledge gratitude to the individuals during my study and without whom the study may not
be completed. I have taken this opportunity to thank those who genuinely helped me.

With immense pleasure, I express my deepest sense of gratitude to Dr. B. Ravi Narayan Sarma,
Faculty for Drafting, Pleading and Conveyancing, Chanakya National Law University, Patna
for helping me in my project. I am also thankful to the whole Chanakya National Law
University family that provided me all the material I required for the project. Not to forget
thanking to my parents without the co-operation of which completion of this project would not
had been possible.

I have made every effort to acknowledge credits, but I apologies in advance for any omission
that may have inadvertently taken place.

Last but not least I would like to thank Almighty whose blessing helped me to complete the
project.

Aman Aditya

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 TABLE OF CONTENTS

I. introduction …………………………………………………………………………………4

II. Object of The Study................................................................................................................. 5

III. Scope of The Syudy................................................................................................................. 5

IV. Hypothesis ............................................................................................................................... 5

V. Research Methodology ............................................................................................................ 5

VI. Source of Data ......................................................................................................................... 5

VII. Importance and Classification of Power of Attorney .............................................................. 6

VIII. How to make a General Power of Attorney for Property? ...................................................... 7

IX. Things to include in POA for Property.................................................................................... 7

X. How to make tt legally valid? .................................................................................................. 8

XI. Authentication and Presumption about Power Of Attorney and persons competent to execute
it…………….. .................................................................................................................... 9

XII. Relevant Considerations .......................................................................................................... 9

XIII. Registration and Revocation of Power of Attorney............................................................... 10

XIV. Qualifications and Legal Powers which can be Granted to an Attorney ............................... 12

XV. Duties of the Attorney Holder and Ooher Related Aspects................................................... 13

XVI. Conclusion ............................................................................................................................. 15

XVII. Bibliography .......................................................................................................................... 16

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INTRODUCTION
“In as much as human being becomes busier, it becomes more necessary for him to depend
on others for getting his things done. Owing to this reason, the power of attorney is now
playing vital role.”1

While the main concern of Indian philosophy is to analyze the fundamental concepts of ethics,
religion, epistemology and metaphysics, its ultimate concern is the social well-being of
individuals. In the recent computer era, where commerce and industry assured large role to play,
the need for entering into contracts of agreements in relation to business and other transactions
become a common and primary feature of daily life. Because of human being became busier, it
became more necessary for him to depend on others for getting his things done. The hectic
activities of the businessmen and industrialists have made the execution of power of attorney for
delegating his functions. A “power of attorney” is a legal instrument whereby one person gives
another person the authority to act on his or her behalf as his legal representative, and to make
binding legal and financial decisions on your behalf.

The relevant act may be called as “POWER OF ATTORNEY ACT, 1882”, which was passed
in the year 1882 on 24th February and the act came into force on first day of May, 1882. This act
applies to the whole of India except State of Jammu & Kashmir. The main aim of passing this
statute is to make it easy for your designated attorney to access your finances and, in that way,
take care of your property. 2 According to the ‘Section: 1A’ of “POWER OF ATTORNEY
ACT, 1882”, “A ‘Power Of Attorney’ includes any instruments empowering a specified person
to act for and in the name of the person executing it”. In Blacks dictionary it is described as the
instrument by which a person is authorized to act as an agent of the granting it. It is pertinent to
mention here a person need not be a lawyer to hold a Power of Attorney as an agent for someone
else. In Strouds judicial dictionary “power of attorney is defined extensively as an authority
whereby one is set in the stead or place of another to act for him”. The Indian Stamps Act
defines it “any instrument empowering any specified person to act for and in the name of the
person executing it.” In Bombay Stamp Act it is defined as “any instrument empowering a
1
Y. SRINIVASA RAO, 'THE POWER OF ATTORNEY' (Article 2015) accessed 25 April 2017
2
Ibid.

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person to act for and in the name of the person executing it and includes an instrument by which
a person a not being a legal practitioner is authorized to appear on behalf of any party in
proceedings before any court tribunal or authority.” The term ‘Power Of Attorney’ is an
authority given by an instrument by one person, called as the donor or principal, authorising
another person, called donee or agent to act on his behalf.3 There may be possibility of giving
‘Power Of Attorney’ by two or more persons jointly to one or more persons. Here a legal
authority is given by the principal to the agent which may be broad or limited and an agent can
take all necessary decisions i.e. financial, property related matters and all other matters where
principal cannot be present to sign or in the case of principal’s illness and disability. A paper
signed by principal giving powers to an agent is sometimes itself called a power of attorney. A
paper giving a power of attorney should be clear and understandable.

OBJECT OF THE STUDY

The prime objective of the researcher for doing this research work is to perform a comprehensive
study of the topic and find out the manner, mode and effect of the transfer of powers from one
person to another through a power of attorney..

SCOPE OF THE SYUDY

The scope of the research is to determine the intricacies involved in the drafting of a power of
attorney and the necessary steps to be taken thereof.

HYPOTHESIS
According to the researcher, the power of attorney must be clear and unambiguous in its nature
and must specifically state the powers to be given.

RESEARCH METHODOLOGY
Doctrinal method of research comprising accumulation of information from books, online
materials and data, newspaper and magazine articles etc. have been used in this project.

SOURCE OF DATA

3
Dhawesh Pahuja, 'Power of Attorney : A Review' (Legal Article 2011) <http://www.legalindia.com/power-of-
attorney/> accessed 25 April 2017

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Primary and secondary, both types of sources have been made use of by the researcher in order
to accomplish the object of the study.

1. IMPORTANCE AND CLASSIFICATION OF POWER OF ATTORNEY

A power of attorney document is an extremely important part of estate planning yet one of the
most misunderstood. It is often convenient or even necessary to have someone else act for you as
there is advancement in the business and commerce transactions. As many people confuse the
power of attorney (POA) with a will (Probate), but these documents are two very different things
and have two very different functions. A will comes into effect on the day person die. A POA
applies during a person’s lifetime and ceases to apply when he dies. So you actually need both a
POA and a will as they complement, and do not overlap, each other. To add a twist to the
subject, there are two types of POA: one for property and one for personal care.4 These two types
are completely separate. They deal with different areas of your life and both are required for
effective estate planning.

The Power of Attorney can be classified into two categories which include:

 General Power of Attorney: A general power of attorney is one by which an instrument is

executed by the principal authorising the agent to do certain acts in general on his behalf. The
word ‘General’ here means that the power must be general regarding the subject matter and
not general with regard to powers in respect of a subject matter. If the subject matter is not
general but restricted to something either specific or specifically mentioned by the principal
while drafting an instrument then it will not constitute a general power of attorney. It is
otherwise called as limited power of attorney.
 Special Power of Attorney: A special power of attorney is one by which a person is
appointed by the principal to do some specified act or acts. In this type of power of attorney,
an agent conferred with a power to do specific act in a single or specified transactions in the
name of the principal.
 Durable Power of Attorney: A Power of Attorney which specifically says otherwise, agent’s
power ends if principal become mentally incapacitated. However, a power of attorney may

4
Robert G. Coates, 'The Importance of Powers of Attorney' (Legal Article n.d.) <http://www.rgcoates.com/the-
importance-of-powers-of-attorney> accessed 25 April 2017

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 say that it is to remain in effect in the event of future incapacity of the principal. A power of
attorney that says this is called a durable power of attorney.

To ascertain whether power of attorney is of general or special in nature, the subject matter in
respect of which power is conferred is to be seen accurately. The power of attorney is the
unilateral document wherein donor or the principal gives authoritative power to the agent by
signing the document and the agent’s sign is not always required.5

2. HOW TO MAKE A GENERAL POWER OF ATTORNEY FOR

PROPERTY?
To draft a GPA for Property, one has to follow these steps:

 Draft the General Power of Attorney deed after you select the person to whom you want to
give the powers.
 Print it on a Stamp paper of due value depending on the State you reside in or where the
property is located since it involves immovable property.
 Sign the Deed on all pages at the bottom, if you are the Grantor.
 Two witnesses should also sign and attest the Deed at the end of the last page.
 Since it involves immovable property, you have to compulsorily register the deed at the
appropriate Sub-Registrar office and pay the appropriate registration fees as per the State
rules.
 Retain the original and give a copy to your Attorney.

3. THINGS TO INCLUDE IN POA FOR PROPERTY

When you make the General Power of Attorney deed as mentioned above, always remember to
be cautious about the clauses that you include. The Powers granted should be clearly explained
in the deed. Remember the following while making the deed:

 Grantor Details: The name, age, address and occupation of the person who grants the power
(Grantor) should be mentioned first.

5
Radhika Sandeep, 'Power of attorney and Section 202 of Indian Contract Act, 1872' (Legal Arbitration Documents
2013) <http://lexarb.blogspot.in/2013/04/power-of-attorney-and-section-202-of.html> accessed 25 April 2017

7
 Attorney Details: The name, age, father’s name, address and occupation of the person to
whom the power is granted (Attorney) should be described next.
 Reason for Giving Power: The valid reason for granting the power should be stated clearly,
for e.g. staying abroad or hospitalised etc.
 Details of Powers granted: Mention all the details of what the Attorney is empowered to do
and what not to do very clearly. For e.g. whether the Attorney has the right to sell or only buy
or just maintain a particular property. You can differentiate the type of powers with respect to
the different types of properties. Remember that you are responsible for any Acts done by the
Attorney under this deed.
 Date and Place: The date and place of making the deed should be mentioned clearly and also
the date when the Power starts operating should also be mentioned separately.
 Signature of Grantor: The Grantor has to place his signature at the end of the document and
also in the bottom of all pages.
 Signature of Two Witnesses: Two Witnesses are required to place their signature with their
name, address and phone number and date stating that they have witnessed the Grantor sign
the deed.

4. HOW TO MAKE IT LEGALLY VALID?

The General Power of Attorney for property can be made legally valid by the following
procedure:

 The person making the deed should first and foremost be mentally sound and capable to
make the deed. An insane person or a lunatic is legally not empowered to make a deed of
Power of Attorney.
 The deed should be made on a Stamp paper of appropriate value according to the State where
it is made or where the property is situated.
 Make sure that the Grantor signs all the pages at the bottom.
 Two witnesses should also sign and attest the document in the last page at the end.
 Register the deed at the Sub-Registrar office after paying the necessary registration fees.

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Revocation- If you want to cancel the Power of Attorney that you created, then you have
to make a deed for Revocation of Power of Attorney.6

5. AUTHENTICATION AND PRESUMPTION ABOUT POWER OF

ATTORNEY AND PERSONS COMPETENT TO EXECUTE IT
As per Indian law, a power of attorney is a legal document that has to be properly framed, using
the right legal terminology and setting out the objectives and responsibilities that you wish to
authorise the appointee to carry out on your behalf. If a person wants to authorise someone to act
as a power of attorney on his behalf, it must be signed and notarised by a certified notary
advocate, who is able to declare that you are competent at the time of signing the document to
issue the said power of attorney. You will need to show your ID to the notary advocate before
he/she is able to certify and issue the document. It must be executed and authenticated by the
registrar or sub-registrar of assurances as per the ‘Registration Act, 1908.

A power of attorney is legal written document which has more legal value and the authenticated
attorney will be presumed by the court as legal document under ‘Indian Evidence Act, 1872’.
According to the Section: 85 of ‘Indian Evidence Act, 1872’, which provides that the court shall
presume that every document purporting to be a power of attorney, and has to be clearly
authenticate and executed before the notary or magistrate. If there is any issue arises concerning
to the genuineness of the attorney then proof of its execution can be called for the verification.

A power of attorney can be executed by any person who is competent to enter into a contract.
However, the married women can execute powers of attorney even if they are minors. A
company while executing power of attorney must make conformity with the ‘Articles of
Association’ and its common seal. A person must be competent to give power to the appointed
person so that it will not affect the legality of the instrument/deed of power of attorney.

6. RELEVANT CONSIDERATIONS
 LANGUAGE OF THE POWER OF ATTORNEY

An instrument of power of attorney must always use the language known to the donor and if the
donor is an illiterate person then scribe and identifier should explain all the contents of the

6
supra note 5.

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document in the language known by the donor and it has to be certified by the donor that he has
understood all the contents and then he has to put thumb mark on the document. Lastly the
administrative officer will take the oath from the donor stating that he knows all the contents of
the document and he knows the identifier. A sign and seal must be put by an administrative
officer after complete verification of the document.7

 ORIGINAL DOCUMENTS TO BE VERIFIED

A power of attorney which is accurately authenticated by the notary or any magistrate, an

affidavit has to be filed with all the original documents of the power of attorney authorising an
agent to do certain acts. All the documents will be verified by the court and then court will
register power of attorney by putting seal and sign. It is very much essential to make the power
of attorney valid.

 POWERS OF ATTORNEY BY TWO OR MORE PERSONS

A power of attorney may be executed by two or more persons jointly in favour of one or more
persons and when there are several persons as attorneys a complete authorisation in letter to be
given by one of them for acting severally. A clause should be included while drafting the deed of
power of attorney that all the attorneys should act jointly or separately.

 DURATION OF GRANTED POWER

A general power of attorney remains in force unless expressly revoked or determined by the
death of either of the party. A special power of attorney will be in force until the specified act is
not completed. Duration of the power will depend upon the type of the attorney or there may be a
fixed period of power granted by the principal which must be included in the deed.8

7. REGISTRATION AND REVOCATION OF POWER OF ATTORNEY

A power of attorney is not compulsorily registrable unless it creates an interest in any immovable
property i.e. charge in favour of donee. Registration of power of attorney is optional in India,
where the ‘Registration Act, 1908’, is in force, the Power of Attorney should be authenticated by
a Sub-Registrar only, otherwise it must be properly notarized by the notary especially where in

7
'Power of Attorney ' (Legal Documents 2013) <http://www.latestlaws.in/library/legal-documents/power-
attorney-2/l> accessed 25 April 2017
8
Ibid.

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case power to sell land is granted to the agent. If a power of attorney is in respect of an
immovable property of value more than Rs100 it must be registered. Registration of power of
attorney authenticates the deed of power of attorney. A power of attorney is chargeable under
Section: 48 of Schedule 1 of the ‘Indian Stamp Act, 1899’. 9 A stamp duty has to be paid
compulsorily by the principal or donor in the jurisdictional registrar’s office.10

REVOCATION OF POWER OF ATTORNEY

Power of Attorney can be revoked in the following cases, in case of:

 Revoked by the principal himself

 The principal dies or becomes insane or becomes bankrupt
 The business for which the agent was appointed is over
 Mutually agreed upon by the principal and agent
 The right under the power of attorney is renounced by the agent

REVOCATION OF GENERAL POWER OF ATTORNEY

According to the judicial perception, under the following circumstances, the power of attorney
can be revoked:

 If the power given to the attorney is coupled with an interest it is irrevocable. To decide
whether a given power is coupled with interest or not regards are to be given to the facts of
each case and the wordings of the instrument itself. The right of an agent to remuneration
though stipulated in the form of property to be produced by exercise of power is not an
interest in the required sense.
 If the power is irrevocable as per the test laid down the parties are nevertheless free to make
it revocable by an express stipulation to the contrary.
 If the power is revocable than the parties cannot make it irrevocable merely by writing that
the instrument is irrevocable.

9
Board of Revenue, Madras, Referring Authority Vs. Annamalai and Co. (Pvt.) Ltd. and Anr. [AIR1968Mad50]
10
iPleaders, 'Power of Attorney ' (Legal Documents 2017) <https://blog.ipleaders.in/power-of-attorney/> accessed
26 April 2017

11
The position in our country is the same as that in England. A power of attorney is automatically
terminated if:

 One of the parties to the instrument dies or becomes insane

 The principal becomes insolvent or bankrupt, any specific condition in the instrument is
breached
 The business comes to an end.

Courts refer to Indian Contract Act provisions to determine this question.

8. QUALIFICATIONS AND LEGAL POWERS WHICH CAN BE

GRANTED TO AN ATTORNEY
It is the duty of the Principal to appoint a responsible person as agent who should act with utmost
good faith. An attorney is a person who has been appointed by the donor to act on his behalf. An
ideal attorney is that who must be willing to act in that capacity and he has to be impartial having
integrity.11 An attorney should be loyal to the donor and should not disclose any confidential
matters related to the business.

Broadly speaking a power of attorney provides an agent “all powers that the principal has” to
manage the principal’s financial affairs or make health care decisions may be enough for many
purposes. An agent may be authorised to:

 To execute all contracts, deeds, bonds, mortgages, notes, checks, drafts, money orders.
 To manage, compromise, settle, and adjust all matters pertaining to real estate.
 To lease, collect rents, grant, bargain, sell, or borrow and mortgage.
 To sell any and all shares of stocks, bonds, or other securities.
 To file, sign all tax returns, insurance forms and any other documents.
 To enter into contacts, and to perform any contract, agreement, writing, or thing to make,
sign, execute, and deliver, acknowledge any contract, agreement.
 To make health-care decisions for the donor or his minor children.

11
Prashant Shah, 'Power of Attorney ' ( 2014) <https://prashantvshah.wordpress.com/category/cfp/page/10/>
accessed 26 April 2017

12
 To sue on behalf of the principal.

9. DUTIES OF THE ATTORNEY HOLDER AND OTHER RELATED

ASPECTS
An attorney holder is a person who is authorised by donor legally. An attorney must not exceed
the authority given under the power of attorney. If the attorney does exceed their authority, he or
she may be liable for any damages suffered by the donor or others. The attorney may, however,
do all those acts which are authorised, but only by a particular method, if the power of attorney
so indicates.12 If there is a breach of any condition by the attorney then he shall be liable to the
donor except in a case where he has acted reasonably. If there is some doubt as to the wording of
the power of attorney, a solicitor should always be consulted. The attorney holder must also act
towards the donor with the utmost good faith and tell the donor the nature and extent of any
interest which may conflict with his or her duty.13 An attorney may pass on his or her powers and
duties to another person but only if authorised to do so by the power of attorney.

OTHER RELATED ASPECTS

 The Basic Principles To Remember

a. The general rule of power of attorney is that it should be strictly construed.
b. Unless an express power is conferred on an agent to enter into contracts of guarantees on
behalf of his principal or to execute or negotiate , negotiable instruments for his principal
jointly with others
c. An agent cannot by his acts bind the principal to a larger extent than he is empowered to do
under the power of attorney.
d. Fraud by the power agent does not bind the principal. He cannot be sued or otherwise held
responsible for fraud by the agent
e. If the power does not authorize the agent to carry on a business except with limitations any
act done by him in excess of such power will not bind the principal. For example power to
dispose of property does not confer a power to mortgage the property.

12
General power of attorney' (Blog 2016) <https://legaldeskblog.wordpress.com/2016/07/25/general-power-of-
attorney/> accessed 26 April 2017
13
supra note 11.

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f. Power to manage immoveable property cannot permit principal's ornaments which are a
moveable proper.
 Important Rules for Construction Of Power of Attorney
a. The operative part of the deed is controlled by the recitals
b. Where authority is given to do a particular act, followed by general words, the general words
are restricted to do what is necessary for the proper performance of the particular acts.
c. General words do not confer general powers, but are limited to the purpose for which the
authority is given, and are construed as enlarging the special powers only when necessary for
that purpose
d. The deed must be construed so as to include all powers necessary for its execution.

 Risk Involved in Granting Power of Attorney: With a power of attorney, an agent is often
entrusted with important decisions. And the agent may have access to some or all of
Principal’s money or other property. If the agent is not trustworthy, serious problems can
result. For example, if the agent is dishonest and runs away with Principal’s money, it may
be difficult or impossible to get the money back. An agent is not permitted to use principal’s
property for his or her own benefit unless he is expressly authorised to do so. 14 Also, a
principal will ordinarily be bound by the agent’s acts (even foolish acts) and will be
responsible for the agent’s negligence while the agent is acting for the principal. 15 For
example, if an agent is authorized to manage your financial affairs and signs a contract to
purchase something on your behalf, you will ordinarily have to pay for it, like it or not. It is
obviously important to choose a trustworthy agent; if no trustworthy candidate is available, a
power of attorney should not serve its purpose.

14
Pratik Prakash, 'An overview to the Power Of Attorney' ( 2016) <https://www.linkedin.com/pulse/overview-
power-attorney-pratik-prakash> accessed 26 April 2017
15
'Liability of Principal and Agent; Termination of Agency' (ebook 2015)
<https://2012books.lardbucket.org/books/the-legal-environment-and-business-law-executive-mba-edition/s15-
liability-of-principal-and-age.html> accessed 26 April 2017

14
 CONCLUSION
The authority is restricted to act only on certain matters or only a particular kind of transaction or
to carry out a specific legal transaction for the Principal. The agent's power of attorney expires
on the completion of the transaction. If any fraud by the power agent does not bind the principal,
he cannot be sued or otherwise held responsible for fraud by the agent. If the power does not
authorize the agent to carry on a business except with limitations any act done by him in excess
of such power will not bind the principal. A fortiori, an agent cannot by his acts bind the
principal to a larger extent than he is empowered to do under the power of attorney.

A power of attorney is very essential legal document which can be admitted as evidence in the
court of law whenever there is any breach of trust by the attorney holder. It’s therefore essential
that principal has great confidence in his designated attorney. An agents must be someone
principal can trust, without reservation, to use his property for him and not for themselves, or
anyone else.

15
 BIBLIOGRAPHY

PRIMARY SOURCES
Statutes

 Power of Attorney Act, 1882

 Indian Stamp Act, 1899
 The Bombay Stamp Act, 1958

SECONDARY SOURCES
Books

 Anil Nandwani, Law of Civil Procedure in India, 1st ed.2006, Allahabad Law Agency,
Faridabad.
 C.K Takwani, Civil Procedure, 5th ed.2003, Eastern Book Company, Lucknow.
 M.P Jain, The Code of Civil Procedure, 1st ed. 2004, Wadhwa and Company, Nagpur.
 Sarkar, Code of Civil Procedure, 10th ed.2002, Vol.2, Wadhwa and Company, Nagpur
 Bindra, NS, ‘Pleadinga and Practice’, 10th ed., 2013, Vol 1, Universal Law Publishing Co.
Pvt, Delhi.

Articles

 Y. Srinivasa Rao, “The Power Of Attorney”(Article 2015)

 Pahuja Dhawesh, “Power of Attorney : A Review” (Legal Article 2011)
http://www.legalindia.com/power-of-attorney/
 Coates Robert G, “The Importance of Powers of Attorney” (Legal Article n.d.)
http://www.rgcoates.com/the-importance-of-powers-of-attorney
 Sandeep Radhika, “Power of attorney and Section 202 of Indian Contract Act, 1872” (Legal
Arbitration Documents 2013) http://lexarb.blogspot.in/2013/04/power-of-attorney-and-
section-202-of.html
 “Power of Attorney” (Legal Documents 2013) <http://www.latestlaws.in/library/legal-
documents/power-attorney-2/l>
 iPleaders, “Power of Attorney” (Legal Documents 2017) https://blog.ipleaders.in/power-of-
attorney/
 Shah Prashant, “Power of Attorney” (2014)
https://prashantvshah.wordpress.com/category/cfp/page/10/
 Prakash Pratik, “An overview to the Power Of Attorney” (2016)
https://www.linkedin.com/pulse/overview-power-attorney-pratik-prakash

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