REG 076 General Power of Attorney and Sale Deed — Law of Registration Notes for Judiciary

The General Power of Attorney and the Sale Deed: Suraj Lamp, Why a GPA Conveys No Title, and What the Holder of GPA Property Actually Has

A general power of attorney and a sale deed are not two ways of doing the same thing. A power of attorney creates an agency: it authorises the agent to act for and in the name of the principal, and the principal remains the owner. A sale deed is a conveyance: it transfers ownership. For many years property in parts of India was passed by a package of an agreement to sell, a general power of attorney and a will, to avoid stamp duty and registration and sometimes to circumvent restrictions on transfer. The Supreme Court condemned the practice in Suraj Lamp & Industries (P) Ltd. v. State of Haryana, (2012) 1 SCC 656, holding that immovable property can be transferred only by a registered deed of conveyance. A very large number of people in India still hold property on that footing, and this note sets out what they actually have.

The two instruments compared, and what Suraj Lamp decided

1. What Each Instrument Is

Section 1A, Powers of Attorney Act, 1882, and Section 54, Transfer of Property Act, 1882

Powers of Attorney Act, Section 1A. "Power of attorney" includes any instrument empowering a specified person to act for and in the name of the person executing it.

Transfer of Property Act, Section 54. "Sale" defined. "Sale" is a transfer of ownership in exchange for a price paid or promised or part paid and part promised.

Sale how made. Such transfer, in the case of tangible immovable property of the value of one hundred rupees and upwards, can be made only by a registered instrument.

Contract for sale. A contract for the sale of immovable property is a contract that a sale of such property shall take place on terms settled between the parties. It does not, of itself, create any interest in or charge on such property.

2. The Two Compared

	General power of attorney	Sale deed
What it is	An instrument of agency, under the Powers of Attorney Act, 1882 and Sections 182 onwards of the Contract Act	A conveyance under Section 54 of the Transfer of Property Act
What it does	Authorises the agent to act for and in the name of the principal	Transfers ownership to the purchaser
Does title pass?	No. Nothing is conveyed	Yes, from the date of execution once registered, Section 47
Who remains owner	The principal	The purchaser
Registration	Optional, Section 18(f), subject to State amendments	Compulsory above one hundred rupees, Section 17(1)(b)
Stamp duty	A fixed sum under the State article	Ad valorem on the higher of the consideration and the market value
On the principal's death	The agency terminates, Section 201 of the Contract Act, unless coupled with an interest under Section 202	Nothing happens; the purchaser already owns the property
Revocation	Revocable at the principal's will, Sections 201 and 203	Does not arise; a registered sale cannot be revoked unilaterally
Mutation	Will not follow on a power alone	Follows the registered deed
Resale by the holder	He sells as agent, in the principal's name, and only if the power authorises it	He sells as owner, in his own name
On the holder's death	The agency ends; his heirs inherit nothing in the property	His heirs inherit the property

3. The Decision

📖 Suraj Lamp & Industries (P) Ltd. v. State of Haryana, (2012) 1 SCC 656

Facts. The Court took up, on a petition concerning the practice in Delhi and the neighbouring States, the widespread use of a package of documents in place of a registered conveyance: an agreement to sell, a general power of attorney in favour of the purchaser, a will in his favour, and a receipt for the consideration. These were known as SA/GPA/WILL transfers.

Held. The Court held that such transactions do not convey title and do not amount to transfers. A power of attorney is not an instrument of transfer in regard to any right, title or interest in immovable property; it creates an agency, and the agent may act for the principal, but the power itself conveys nothing. An agreement to sell transfers no title, by the third paragraph of Section 54. A will takes effect only on death and is revocable until then. Immovable property can be transferred or conveyed only by a registered deed of conveyance.

Ratio. What none of the documents can do singly, they cannot do in combination. The Court clarified that the judgment does not affect the legitimate use of agreements to sell and powers of attorney, does not affect the doctrine of part performance under Section 53A, and does not disturb transactions already concluded, whose holders were left to have their titles regularised by obtaining proper deeds of conveyance.

The reasoning is structural, not punitive. Each of the three documents lacks the quality of a transfer for a different reason, and putting them together supplies none of them.
The Court was concerned with the consequences, which it identified as loss of revenue to the State, the growth of black money, and the creation of a class of property held on documents that prove no title.
It preserved the legitimate uses. A genuine agreement to sell, a genuine power of attorney granted for management or for a development, and the protection of Section 53A, all survive.
It preserved concluded transactions, leaving holders to regularise, which is what a very large number of people still need to do.

4. Why Each Document Fails

The document	Why it does not transfer
Agreement to sell	Section 54, third paragraph: a contract for sale does not, of itself, create any interest in or charge on the property. It gives a right against the seller, not a right in the land
General power of attorney	It creates an agency. The agent acts in the principal's name, and the principal remains the owner. The agency terminates on the principal's death, revocation, or insolvency, under Section 201 of the Contract Act
Will	It is testamentary: it transfers nothing during the testator's lifetime, and is revocable at any time until death under Section 62 of the Indian Succession Act, 1925
Receipt for the price	It acknowledges payment. It is not an instrument of transfer, and proves only what it says
All four together	A combination of documents none of which transfers cannot transfer. The defect in each is a defect of kind, not of degree

⚠ An irrevocable power is still not a conveyance

Parties commonly describe the power as irrevocable, recite that consideration has been received, and provide that it is coupled with an interest, in the hope of turning it into a transfer. It remains an instrument of agency. Section 202 of the Contract Act provides that where the agent has himself an interest in the property which forms the subject matter of the agency, the agency cannot, in the absence of an express contract, be terminated to the prejudice of that interest. That makes the agency durable; it does not make the agent an owner. And the interest must exist independently of the power: an interest created by the power itself, or an interest merely in the remuneration or the proceeds, is not within Section 202.

5. What the Holder of GPA Property Actually Has

1. He is not the owner. The title remains with the person who executed the power, and on that person's death it devolves on his heirs.

2. He has a contractual right under the agreement to sell, enforceable by a suit for specific performance. Limitation runs under Article 54 of the Limitation Act, 1963: three years from the date fixed for performance, or from when he had notice of refusal. In most of these transactions that period expired long ago.

3. He may have the shield of Section 53A, if he is in possession, took it in part performance, is willing to perform, and the agreement satisfies Section 17(1A) where it was executed on or after 24 September 2001. The shield debars the seller; it gives no title.

4. He cannot obtain mutation on the power alone, and the revenue record will continue to show the principal.

5. He cannot sell as owner. He may sell only as agent, in the principal's name, and only while the agency subsists.

6. The agency dies with the principal. On the principal's death the power terminates under Section 201, unless it is coupled with an interest under Section 202, and thereafter there is nobody whose name the agent can sell in.

7. His heirs inherit nothing in the property. They inherit his contractual claim, if it survives, and nothing more.

8. He is exposed to the principal's creditors, to attachment, and to a transfer by the principal to a purchaser without notice.

6. How to Regularise

The route	What it requires	Practicality
Obtain a registered sale deed from the original owner or his heirs	Their cooperation, and payment of the duty and fee now, on the current market value	The cleanest route; often obstructed by the passage of time and the death of the original owner
Sue for specific performance on the agreement to sell	That limitation under Article 54 has not expired, and proof of readiness and willingness under Section 16(c) of the Specific Relief Act, 1963	Frequently barred by limitation, because the transaction is old
Rely on Section 53A as a defence	Possession taken in part performance, a signed writing with ascertainable terms, willingness to perform, and registration where Section 17(1A) applies	A shield only; it preserves possession but confers no title and does not enable a sale
Claim title by adverse possession	Possession that is actual, open, continuous and hostile for twelve years under Article 65, with the animus admitted	Difficult, because possession under a power is permissive in origin and not hostile
A State amnesty or regularisation scheme	Whatever the scheme provides	Several States have run such schemes; they are time bound and must be checked locally

The honest summary is that the routes narrow with time. A holder who acted within three years of the agreement had a straightforward remedy; a holder whose transaction is twenty years old, whose seller is dead, and whose agreement fixed no date for performance, is in a difficult position, and the practical answer is usually a negotiated conveyance from the heirs.

7. The Legitimate Uses That Survive

A power of attorney for management. Letting, collecting rents, paying taxes, dealing with authorities and conducting litigation are the ordinary and proper uses.
A power to present a document for registration, authenticated under Section 33, which is the commonest special power of all.
A power given to a developer under a development agreement, coupled with an interest under Section 202, to deal with the land and execute conveyances to the eventual purchasers. Those conveyances must themselves be registered.
A power given by a person resident abroad, authenticated under Section 33(1)(c), to manage or to sell on his behalf, the sale being effected by a registered deed executed in his name.
A genuine agreement to sell, with or without possession, enforceable by specific performance.
Section 53A, which the Court expressly preserved.

8. The Direction of Reform

The draft Registration Bill, 2025, published for public consultation by the Department of Land Resources on 27 May 2025, proposes to make powers of attorney authorising the transfer of immovable property compulsorily registrable, which would bring every such power onto the public record.
It also proposes to make agreements to sell compulsorily registrable, including developer and promoter agreements.
It has not been enacted, and the Registration Act, 1908 remains the law in force.
Several States had already moved in the same direction by local amendment, requiring registration of a power authorising sale, so the State position must be checked.
The object of both is the same one Suraj Lamp identified: to make property dealings visible on a public record, so that a purchaser who searches can find them.

9. The Position Stated Shortly

1. A power of attorney creates an agency; a sale deed conveys the property.

2. A power of attorney is not an instrument of transfer and conveys no title, Suraj Lamp & Industries v. State of Haryana.

3. An agreement to sell transfers no title, by the third paragraph of Section 54; a will transfers nothing until death and is revocable until then.

4. What none of these documents can do singly, they cannot do in combination.

5. Immovable property can be transferred only by a registered deed of conveyance.

6. An irrevocable power, or one coupled with an interest under Section 202 of the Contract Act, is still not a transfer; it makes the agency durable, not the agent an owner.

7. The interest under Section 202 must exist independently of the power.

8. A GPA holder is not the owner, cannot obtain mutation, cannot sell as owner, and his heirs inherit nothing in the property.

9. The agency terminates on the principal's death under Section 201, unless coupled with an interest.

10. What he has is a contractual right under Article 54, and possibly the shield of Section 53A, subject to Section 17(1A).

11. Suraj Lamp preserved the legitimate use of agreements to sell and powers of attorney, the doctrine of part performance, and concluded transactions, which the holders were left to regularise.

12. The draft Registration Bill, 2025 proposes to make powers of attorney for transfer, and agreements to sell, compulsorily registrable. It remains a draft.