GPA sales and the law: why a power of attorney is not a sale

The rule

The judgment rests on three provisions of central law:

• Sale needs a registered instrument. A sale of tangible immovable property of the value of one hundred rupees and upwards “can be made only by a registered instrument” (Transfer of Property Act, 1882, s. 54). A contract for sale “does not, of itself, create any interest in or charge on such property” (s. 54).
• Unregistered documents do not affect the property. A document that must be registered “shall not affect any immovable property comprised therein” unless registered (Registration Act, 1908, s. 49).
• A power of attorney is an agency. It is “any instrument empowering a specified person to act for and in the name of the person executing it” (Powers-of-Attorney Act, 1882, s. 1A), and what the attorney does is “as effectual in law as if it had been executed or done by the donee of the power in the name … of the donor” (s. 2). The donor remains the owner.

From these, the Haryana Urban Development Authority’s legal-wing memo summarises the Court’s holding as follows: a power of attorney “is not an instrument of transfer in regard to any right, title or interest in an immovable property”; it is revocable unless made irrevocable “in a manner known to law”, and “even an irrevocable attorney does not have the effect of transferring title”. SA/GPA/Will transactions “cannot be relied upon or made the basis for mutations in Municipal or Revenue Records”, and this applies to leasehold as well as freehold property.

What the Court did not invalidate

The memo records three limits on the ruling:

1. Genuine powers of attorney remain valid. A person may give a power of attorney to a spouse, son, daughter, brother, sister or relative “to manage his affairs or to execute a deed of conveyance”. That is the use described in power of attorney from abroad: the attorney signs a registered sale deed in the owner’s name.
2. Past acceptances are not reopened. Where SA/GPA/Will documents “have already been accepted/acted upon by Development Authority etc., they need not be disturbed, merely on account of this decision”.
3. Part performance still exists, but needs registration. Section 53A of the Transfer of Property Act protects a buyer in possession under a written contract who has performed or is willing to perform. Since the 2001 amendment, such a contract “shall be registered”, and if it is not, it has “no effect for the purposes of the said section 53A” (Registration Act, s. 17(1A)). An unregistered agreement does not give this protection.

How it plays out in practice

• Development authorities. HUDA (now HSVP) instructed its Zonal Administrators to decide first whether an appeal filed through a GPA holder is a disguised sale, and to ask both the allottee and the GPA holder for affidavits that no money passed; if it is a GPA sale, the appeal is rejected. Estate officers apply the same check to transfer permissions.
• Revenue and municipal records. A mutation cannot be based on an SA/GPA/Will chain; see mutation of property records.
• Lenders. Lenders take a mortgage from the owner of record; a GPA holder is not that owner. See home loan lenders.

Step by step: buying a property held on GPA

1. Identify the owner of record from the registered deeds and the revenue or municipal record, not from the GPA. See title search and encumbrance certificate.
2. Check every link of the chain. Each transfer must be by a registered deed; an SA/GPA/Will link is a gap in title.
3. Get a registered sale deed. Either the owner of record signs it, or an attorney holding a genuine power of attorney signs it in the owner’s name. Stamp duty is paid on the deed: use the stamp duty calculator and see property registration process.
4. For leasehold land, involve the lessor. On development-authority land, the transfer usually needs the authority’s permission; see freehold vs leasehold property.
5. Do not pay the full price against an SA and GPA alone. A sale agreement creates no interest in the property (TPA s. 54), and an unregistered one gives no part-performance protection.

Which professional to consult

A property lawyer (advocate) enrolled with the State Bar Council checks the chain and drafts the sale deed. See property lawyers. This guide states the published rule and is not legal advice.

Sources and limits

The text of the judgment is published in the Supreme Court Reports ([2011] 11 S.C.R. 848) on the Court’s digital reports site, which could not be opened from Payotte’s connection on 18 October 2026. This guide relies on the official summary in the HUDA legal-wing memo and on the statutes, read directly; paragraph numbers of the judgment are not cited for that reason.