This is a special leave petition in which Supreme Court has referred to the ill – effects of General Power ofAttorney Sales or Sale Agreement/General Power of Attorney/Will transfers.
The Court has said that both the above terms are not capable to make the execution of sale successful. These documents are used to avoid payment of stamp duty and registration charges on the documents of transfer of property, to avoid payment of capital gains on transfers, to invest unaccounted money (‘black money’) and to avoid payment of‘unearned increases’ due to Development Authorities on transfer. The transfer of property made through Sale Agreement/General Power of Attorney/Will transfers is not genuine transactions.The states of Delhi, Haryana, Punjab, and Uttar Pradesh gave their own views on this matter. They stated that transfers with the help of above instruments that is General Power of Attorney, Will, Sale agreement needs to be discouraged as they lead to loss of revenue and increase in litigations due to defective title.When parties resort to SA/GPA/WILL transfers, the adverse effect is not only loss of revenue i.e. stamps duty and registration charges but the prominent danger is generation of unaccounted money. Reducing the stamp duty on transfer of properties will encourage public to disclose the maximum sale value and have the sale deeds registered. With this the parties will be encouraged to execute registered sale deeds. With high stamp duty the tendency to undervalue documents increases.
The Court further demarcated that as per section 54 of transfer of property act agreement of sale does not, of itself, create any interest in or charge on such property. In the absence of a duly stamped and registered document as required by law, no right, title or interest in an immoveable property can be transferred.
Power of attorney is not an instrument of transfer in regard to any right, title or interest in an immovable property. The power of attorney is creation of an agency whereby the principal authorizes his agent to do the acts specified therein, on behalf of the principal that binds the principal as if done by him.
The will is the last statement of the maker directing distribution of his estate upon his death. It is not a transfer inter vivos. The two essential characteristics of a will are that it comes into effect only after the death of the maker an dis revocable at any time during his life time. Registration of a will does not make it any more effective.
Lastly the Court held that immovable property can be legally and law fully transferred only by a registered document.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 recognized as a valid mode of transfer of immoveable property. Such transactions will not be considered as completed. Such transactions cannot be relied upon or made the basis formutations in Municipal or Revenue Records. The above said procedure will apply to transfer of leasehold property too. A lease can be validly transferred only under a registered Assignment of lease.


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