Power Of Attorney Act

Table Of Contents

• What is the Power of Attorney Act?
• Is there any Validity for Power of Attorney?
• What is the Right of Power of Attorney holder?
• What are the Conditions for Power of Attorney?
• Latest Amendments in the Power of Attorney Act in India
• Latest Supreme Court Judgement for Power of Attorney
• Conclusion

The Power of Attorney (POA) is a document whereby one person (the principal) gives another person (the agent) the authority to manage all matters related to finance, law or health care that pertains to the principal. It assures the principal’s rights, lays down the responsibilities of the agent and may include certain measures to avoid the exploitation of the said agent. The POA has to be completed in accordance with the law and they can be cancelled at the instance of the principal so long as he is of sound mind. As such, it presents a means of control over the agent and the activities they are allowed to undertake.

What is the Power of Attorney Act?

The Power of Attorney Act is a legal document that provides general rules on how a Power of Attorney or powers of attorney are created and the circumstances under which they may be used, thereby allowing one person (the principal) to grant authority to another (the agent) to take action on the principal’s behalf in matters such as financial, legal or health care matters. It recognizes the rights of the principal; it outlines the obligations of the agent; and it may contain measures to prevent abuse. The act differs from one jurisdiction to another; but, in general, aims to provide the necessary legal framework for the drafting, execution and enforcement of powers of attorney.

Is there any Validity for Power of Attorney?

a Power of Attorneys (POA) is legal in nature and as such depends largely on the court of law where it was executed if the law has been duly followed. For a POA to be valid, it must be executed by the principal (the individual who grants the authority) and in most cases, it is bear witness and notarized as well. The document stated allot what authorities were given to the agent and it can be both limited or broad. A Durable POA stays in effect even after the principal becomes incapacitated due to some event, whereas a General POA ceases to be valid after the principal has been declared to have lost mental capacity. It is revocable by the principal and it is applicable only when the principal is competent to do so.

What is the Right of Power of Attorney holder?

The rights of an Power of Attorney Holder are as follows;

• Authority to Act: The holder can make decisions and take actions accordingly
• Limited Powers: the rights of the holder are defined by the scope of POA, whether general or specific.
• Duty to Report: it is the duty of the holder to provide the report to the third party in some cases.
• Rights to Compensation: if specified in the POA the holder may get the compensation for their services.

What are the Conditions for Power of Attorney?

The essential conditions that render a Power of Attorney (POA) valid include the following.

• Capacity: The principal who makes the POA should be of legal age and be mentally sound.
• Voluntary Consent: The Principal should freely sign the POA without compulsion.
• Clear Intent: The principal needs to have a clear intent of empowering the agent.
• Specific Powers: The POA needs to outline the powers given to the agent whether the powers are general or specific.
• Witness/Notarization: Depending upon the jurisdiction, the POA is required to be notated/ witnessed so as to be legally binding.
• Revocation: The principal may terminate the POA at any other time while being within his or her right faculties unless otherwise stated.

What are the Latest Amendments in the Power of Attorney Act in India?

The last amendments to the Power of Attorney Act C 357 in India focus on the reducing or eliminating the procedures and addressing the concerns of abuse of the power. For instance, the Power of Attorney (Amendment) Act, 2018 also introduced electronic registration of Power of Attorney in some cases, which also helped in accessibility and transparency. Further, there are amendments that require more anti-fraud measures including the requirement for the documentation of the principals’ intent and witnessing of the POA where applicable, such as in the case of financial transactions. With these changes, the aim is to increase the level of accountability and curb looting of powers conferred to the agents.

What is the latest Supreme Court Judgement for Power of Attorney?

The latest Supreme Court judgment on Power of Attorney (POA) is “S.R. Srinivasa v. R. Natarajan” (2022). In this case the court stated that a POA holder cannot go beyond the scope of authority given to him. If he does that then the act will be void and may not be enforceable.

Conclusion

To conclude, it is evident that, a Power of Attorney (POA) is an important legal document that is made to help an individual confer authority to another for the purposes of managing affairs that are financial, legal or health related. It is important for the principal to ensure that the terms and the means through which the POA was created are legal. There have been recent changes back home in India that seek to enforce this and to remove the loopholes that have been mentioned before and the supreme court decisions have also stated that for there to be an agent, he must have the power ‘delegated to him.’ When done correctly, a POA creates balance and protection for all parties concerned.