POWER OF ATTORNEY FOR NRI’S

Frequently asked question on Power of attorney execution by NRI’s

1.      What is a Power of Attorney?

Simply stated, a Power of Attorney is an authorisation. It gives power or authority to a person, to act for another. The scope of power or authority is as contained in the deed.

2.      Who are parties to the Power of Attorney?

The person who gives the power is known as the “Donor” or “Grantor” or “Principal.” The person in whose favour it is granted is known as the “Donee” or “Grantee” or “Agent” or “Attorney.”

3.      Are there many types of Powers of Attorney?

Yes. The two major types are General Power of Attorney and Special Power of Attorney. A General Power of Attorney is used when the Agent is empowered to undertake many transactions on behalf of the Principal. A Specific Power of Attorney is granted when the Agent is to undertake specific transactions.

4.      I am living abroad. I want to appoint my father or mother or a relative as Agent. Can this be done?

Yes. You can execute a Power of Attorney and send it to the Agent, in India. The Agent can adjudicate this Power of Attorney, within three months after receipt in India.

5.      What is this adjudication?

This is a method of paying proper stamp duty for the Power of Attorney. This is a simple process. The stamp duty payable for a Power of Attorney varies from State to State in India. It is also determined on the basis of contents of the deed.

6.      What is the process for due execution abroad?

You have to sign this before a Consulate Officer or a Notary in the country of your residence. Your signature in the deed has to be attested by the Consulate Officer or Notary.

7.      Are there any precautions?

Yes. Make sure that you sign every page. Most of these deeds are signed only in the last page. This is not accepted, generally, in India. At times, the date on the document and the date of attestation differ. This is never accepted. Always send a covering letter or note with a date on it. This will help in computation of time of three months for adjudication.

8.      I want to make a Will in respect of my assets in India. Can I grant a Power of Attorney for this?

No. An Agent cannot make a Will for you.

9.      Suppose the Agent expires. What happens to the Power of Attorney?

Normally, the Power of Attorney will lapse. However, all the acts already done legally by the Agent will be binding on you.

10.    I have properties in many States in India. I want to give separate Powers of Attorney in respect of each item. Is this possible?

Yes. You can execute as many Powers of Attorney as you desire.

11.    I want to grant a Joint Power of Attorney. Is this possible?

Yes. You can empower two or more persons jointly or severally to act on your behalf.

12.    What are the implications of a Power of Attorney?

The acts of the Agent would be normally binding on you. If a mortgage is made in your name, there could be a personal liability, which may extend beyond the value of property in question. If the acts of the Agent violate Acts such as Foreign Exchange Management Act, you may be personally liable. Therefore, make sure that the document is clear and you understand the implications.