Power of Attorney vs Registry: What Delhi’s New GPA Rules Mean for Homebuyers

The purchase and sale of property through a General Power of Attorney (GPA) has been a common practice in Delhi for years, especially in many unauthorised and regularised colonies. But the Delhi government has now restricted this practice by making it tougher to use GPA documents for property deals that are essentially sales.

The move aims to prevent stamp duty evasion, fake property deals and ownership disputes. If you are planning to buy or sell property in Delhi, here’s what the new rules mean and why it is now more important than ever to know the difference between a GPA and a registered sale deed.

What Is a General Power of Attorney (GPA)?

A General Power of Attorney (GPA) is a legal document that allows one person (the owner) to give another person the authority to act on their behalf for financial, legal or property-related matters.

For example, if a property owner is living overseas or can’t go to government offices in person, they may give someone else a GPA to do paperwork or manage the property.

But a GPA is not ownership.

According to the Supreme Court judgements and the existing rules in Delhi, a GPA does not confer legal ownership of a property. A change of legal ownership takes place only through a registered sale deed (registry) after the payment of the relevant stamp duty and registration charges.

GPA vs Registered Sale Deed: What’s the Difference?

Many buyers tend to confuse a GPA with a property registry. However, they have completely unique functions.

This distinction is at the heart of the Delhi government’s latest crackdown.

Why is the Delhi Government Tightening GPA Rules?

Often, people were selling property and registering the documents as GPAs, the Revenue Department found.

The Revenue Department found that some transactions were GPAs with only nominal stamp duty and not the full stamp duty applicable on a sale deed. Many such documents also had clauses related to payment of money, handing over possession and permanent transfer rights.

The government says the practice costs it revenue and increases the risk of fraudulent land deals.

Chief Minister of Delhi Rekha Gupta said the aim was to improve transparency, prevent misuse of GPA registrations and protect genuine buyers.

What is Different Under the New Rules?

The biggest change is that all GPA documents will now be examined more closely before registration.

Sub-registrars have been asked to check whether the GPA:

• This pertains to payment or other monetary remuneration.
• Transfers the ownership of the property.
• Is irreversible in nature.
• Grants the permanent right to sell, gift, transfer or mortgage the property.

If the conditions indicate that the document is indeed a sale of property, then it can be treated as a sale deed and attract full stamp duty.

Who Will Come Under Greater Scrutiny?

The new rules will mainly impact GPAs created for the benefit of people who are not close blood relatives. Where the GPA is granted to a person other than the owner’s parents, spouse, children, brothers or sisters, the sub-registrar shall not be allowed to register it directly. The document has to be first sent to the Collector of Stamps, who will investigate whether the document is a genuine power of attorney or an attempt to disguise a property sale to dodge paying the applicable stamp duty.

How Long Will the Process Take?

The collector of stamps has been directed to pass a written order within 30 days. The period may be extended up to three months in exceptional cases.

That decision must be made – and the correct stamp duty, if any, paid – before the property registration can progress.

What Happens If You Already Bought a Property with a GPA?

Most people in Delhi, especially in regularised colonies, bought homes years ago based only on GPA documents.

Legal experts say there is no need to panic but buyers must know that a GPA alone does not confer legal ownership.

If it is eligible for normal registration, then you may have to execute a proper registered sale deed by paying the stamp duty and registration charges.

In case the original owner is not available or is dead, it may require getting the consent of legal heirs or filing a civil suit for orders to be passed before registration.

What This Means For Home Buyers

The Delhi government believes that the new rules will:

• Cut down on phoney property transactions.
• Stamp duty dodging needs to stop
• Protect legitimate buyers from faulty documentation.
• Increase transparency in property registration.

Officials also warned sub-registrars to follow the new procedure or face disciplinary action. Such cases will be separately recorded and an online tracking system is expected to be introduced for better monitoring.

What Property Buyers Should Do Now

If you are buying or selling a property in Delhi, don’t assume that a GPA gives you ownership. Under the new rules, authorities will scrutinise property transactions based on GPA, especially those involving non-relatives. Buyers need to ensure the property has the correct legal documents. They should verify whether a registered sale deed is necessary to establish ownership before making any payment.

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