C&M E-ALERT: REASSESSING POWER OF ATTORNEY IN PROPERTY TRANSACTIONS: SUPREME COURT CALLS FOR LARGER BENCH

The Supreme Court, in a significant decision,[1] revisited the legal standards governing Power of Attorney (PoA)-based property transactions. The core question—can a PoA holder who executes and presents a document for registration bypass the formal authentication requirements under Section 33 of the Registration Act, 1908 (Act)—was referred to a larger Bench due to conflicting precedent.

At stake is the continued validity of the judgment by a coordinate Bench of the Supreme Court in Rajni Tandon v. Dulal Ranjan Ghosh Dastidar (Rajni Tandon),[2] which had held that an agent executing and presenting a document under a PoA qualifies as the “executant” under Section 32(a) of the Act, exempting such instruments from the strict authentication requirement under Section 33.

BACKGROUND

The appeals arose out of a dispute involving an Irrevocable General Power of Attorney dated 15 October 1990, allegedly executed by Ranveer Singh and his wife in favour of their tenant, G. Rajender Kumar. Acting under the PoA, Rajender Kumar executed and presented three sale deeds in favour of his wife. The principal subsequently denied execution of the PoA, giving rise to litigation concerning the validity of the documents executed under its authority.

The High Court upheld the registration of the sale deeds, placing reliance on the Supreme Court’s earlier decision in Rajni Tandon.

LEGAL ISSUE

The key issue before the Court was whether a PoA holder who both executes and presents a document for registration is exempt from compliance with Section 33 of the Act, 1908, which mandates authentication of the PoA before the Sub-Registrar.

In Rajni Tandon, the Court had held that when a PoA holder signs and presents a document for registration on behalf of the principal, he is to be treated as if he himself executed the document. As a result, the Court concluded that there was no need for the PoA to be formally verified or authenticated before the registering authority.

The present Bench took a different view, holding that even when a PoA holder signs and presents a document for registration, he does so purely as an agent acting on behalf of the principal. He is not treated as the actual executant in his own right. Accordingly, the formal requirements that apply to documents submitted by agents—including proper verification and authentication of the PoA—must still be complied with.

KEY OBSERVATIONS

The Court observed that treating a PoA holder as the executant of a document simply because he has signed and presented it for registration, is inconsistent with the statutory framework. It clarified that the true executant remains the principal in whose name the document is executed, and the PoA holder merely acts as an agent. Therefore, the procedural safeguards applicable to agents (such as verification and authentication of the PoA) cannot be bypassed merely based on who physically signs or presents the document.

The Court further cautioned that equating an unverified PoA holder with the actual executant would create an incongruous situation where the act of transferring title in immovable property could escape scrutiny, while the more ministerial act of presenting the document would remain regulated. Such an approach, it held, undermines the integrity of the registration process. Concluding that the view taken in Rajni Tandon was unsustainable, the Bench referred the issue to a larger Bench for authoritative determination.

SIGNIFICANCE OF THE REFERENCE 

The Supreme Court’s referral has far-reaching consequences for PoA-based property transactions—an increasingly common mechanism in real estate, especially among NRIs and developers. If the stricter view is upheld, it will mandate formal authentication of all PoAs used in executing and presenting sale deeds. This would elevate compliance thresholds, increase scrutiny, and potentially delay transactions, particularly where principals reside abroad.

More importantly, the decision signals a decisive shift toward procedural integrity in property dealings. It underscores that the ease of execution cannot come at the cost of legal safeguards. For stakeholders—developers, registrars, and legal practitioners—this could necessitate a fundamental re-evaluation of due diligence practices and documentation standards in property transfers involving agents.

[1] G. Kalawathi Bai (Died), per LRs. Versus G. Shashikala (Died), per LRs., and others etc., Civil Appeal No(s) 9497-9501 of 2025.

[2] (2009) 14 SCC 782.

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