Supreme Court Doubts View That Power Of Attorney Holder Can Present Sale Deed For Registration As 'Executant' Without Further Authentication

The Supreme Court on Tuesday (July 15) referred to a larger bench a question of whether the Power of Attorney (“PoA”) holder will become an 'executant' of a sale deed and can present the deed for registration without fulfilling further authentication requirements under the Registration Act, 1908 (“Act”). The bench comprising Justices Sanjay Kumar and KV Viswanathan disagreed with the previous ruling of Rajni Tandon v. Dulal Ranjan Ghosh Dastidar, (2009) 14 SCC 782 which held that the PoA becomes an executant of the sale deed, and therefore need not comply with the authentication requirements under the Act.In Rajni Tandon, the Court observed that when a document is executed by an agent for a principal in terms of a power of attorney and the same agent signs, appears and presents the said document or admits its execution before the registering officer, it would not be a presentation falling under Section 32(c) of the Act and there would be no necessity for 'authentication' of the power of attorney, as required by Section 33(1)(a) of the Act.Disagreeing with the view in Rajni Tandon, the present bench noted that as per Section 33 of the Act, the power of attorney recognizable for the 'purposes of Section 32' has to fulfil the requirements set out therein so as to validate it. Further, Section 34(3)(a) of the Act casts a duty on the registering officer to enquire whether or not the document presented for registration was executed by the person(s) by whom it purports to have been executed; satisfy himself as to the identity of the persons appearing before him and alleging that they have executed the document.In this background, the Court observed that the PoA holder doesn't become an “executant” as he merely signs on behalf of the principal acting as an agent, and hence, the PoA has to satisfy the other authentication requirements as set out in Sections 33 and 34.“With due respect to the learned Judges who decided Rajni Tandon (supra), we are unable to subscribe to this view. A power-of-attorney holder executes a document, say, a sale deed, not in his own name but in the name of his principal, and signs it on behalf of the principal by virtue of the authority conferred upon him by the power of attorney. He does not, thereby, become the 'executant' of the sale deed as the said sale deed would invariably be executed in the name of the principal, who would be shown therein as represented by the power-of-attorney holder. The power-of-attorney holder, therefore, does not become the 'executant' referred to in Section 32(a) of the Act but would still remain the agent and, by virtue of being authorized by the power of attorney, he merely executes and signs it on that principal's behalf.”, the Court said.The Court noted that usually, General Power of Attorney deeds authorize the agent not only to execute the document but also to present them for registration. It is by virtue of such a specific authorization to present the deed that the PoA holder presents the document for registration and not by virtue of him being an 'executant' in terms of Section 32(a) of the Act."By merely signing a document on behalf of the principal, a power-of-attorney holder does not lose his status as an agent of that principal and become the 'executant' in his own right. Such an agent would, therefore, continue to be covered by Section 32(c) of the Act as he would then present the signed document for registration only as an agent and must necessarily satisfy the requirements of Sections 32(c), 33. 34 and 35 of the Act and the rules framed in that context," stated the bench.The Court noted that the dictum in Rajni Tandon's case had opened the door to a misuse of property transactions and warned that such laxity compromises the reliability of registered documents and undermines the public's trust in property records. “The contrary interpretation adopted and applied by the Bench in Rajni Tandon (supra) would lead to a rather incongruous situation where a notarized power-of-attorney holder, as in that case, who executes a sale deed would become its 'executant' in terms of Section 32(a) of the Act and would be entitled to get the sale deed registered without further ado but, hypothetically and only for the purpose of illustration without reference to the legal repercussions and validity of such an act, if that notarized power-of-attorney holder then executes a power-of-attorney, even if registered, in favour of any person to merely present the sale deed executed by him for registration, that registered power-of-attorney holder has to pass the tests set out in Sections 32(c), 33, 34 and 35 of the Act! In effect, the merely mechanical act of presentation of a document for registration would have to be subjected to rigorous scrutiny but the weightier act of executing a document transferring title in immovable property on behalf of the true owner, on the strength of a power of attorney, which may even be unregistered or just notarized, passes muster...

Supreme Court Doubts View That Power Of Attorney Holder Can Present Sale Deed For Registration As 'Executant' Without Further Authentication

Yash Mittal

Doubting a 2009 judgment, a two-judge bench referred the issue to a larger bench.

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