Corporate & Commercial Series
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This series of articles is intended to give you a general and practical understanding of managing your affairs, executing transactions, and performing tasks through power of attorneys in India. It is my objective that by the end of this series, you will have a better understanding of what it means to authorise someone else to act on your behalf and the practical and the legal aspects that you may consider while doing so.
This series of articles will cover a general overview of power of attorneys and the legal and practical aspects of executing a power of attorney for its use in India.
An introduction to power of attorneys.
With more and more people having global and fast-moving lives, one often finds themself with little to no time to attend to all of their affairs at once. In many situations we find ourselves with no choice but to delegate and depend on someone else for attending to our affairs. If you are an individual, this could be for various reasons, be it on account of your inability to attend to these matters in person, old age, health, you may live in a different state or country, or your unavailability to be physically present at two places at the same time. For an entity, it could be for the simple reason that they cannot physically in person act on some matters or because the law requires the entity to assign a designated person/s to act on its behalf.
This is where the concept of power of attorneys comes to be of relevance.
A power of attorney is a legal document through which a person (individual / entity) authorises another person to act on their behalf. The person granting the power is commonly known as the “Grantor” and the person to whom such power is granted is known as the “Attorney”.
In India, the Power of Attorney Act, 1882 is the special law that primarily governs power of attorneys. However, in addition to the special law, the basic principles of power of attorneys are also governed by the law relating to “agency” under the Indian Contract Act, 1872. In essence an attorney is an agent who is authorised by a grantor to act on their behalf in situations where the grantor is unable to act themselves. Anything that an attorney does within the purview of the powers conferred upon them by the grantor and in accordance with the power of attorney are legally binding upon the grantor. It is for this reason that you must be careful in choosing a person to appoint as your attorney and the extent of the powers you grant them. A power of attorney may be granted for general purposes or for a specific purpose. In each case, it is important for the power of attorney to clearly list down each of the powers entrusted upon the Attorney and the extent of the freedom enjoyed by the Attorney in exercising those powers.
While a power of attorney is a document of convenience, you must weigh the necessity for such delegation against the implications it may have and the possibility of any misuse. It is advisable to consult a lawyer to ensure that the power of attorney is appropriate for the purpose for which it is intended, to limit the possibility of misuse, and to ensure your interests are protected.
About the Author
Mansi Jain has been with MZD Legal Consultancy since 2016 and has also been practicing law since 2016. Mansi is a part of the Real Estate, Estates & Succession Planning, and General Corporate and Commercial practices at the firm. She can be contacted at mansi@mzdlegal.in.
About MZD Legal Consultancy
MZD Legal Consultancy is a boutique law firm in Mumbai, India. The firm was established in 2011 and comprises professionally qualified lawyers with varied levels of experience and expertise in specific practice areas. To know more, click here www.mzdlegal.in
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