Legal Question in Banking Law in India

Purchasing property

I am purchasing a property from a party who has only the power of attorney which he took two years back from the original owner. He got the certificate also of stating that he received all the amount against property and he do not have any ojection for relasle.

Now when I am going for loan, bank is not issueing cheque to the second owner and insisting that he should have proper sale deed. They are fine with issueing cheque to the first owner where he do not want it as due to IT issue.

my question is can bank issue loan cheque to the second owner holding Power of attorney?


Asked on 3/20/08, 2:05 pm

5 Answers from Attorneys
Homi Maratha N.N. Maratha & Co.-Advocates

Re: Purchasing property

I would strictly advise you not to purchase this property as technically POA does not create any rights, interest or title.

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Answered on 3/25/08, 3:35 am

Re: Purchasing property

It depend upon the policy of bank.

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Answered on 3/21/08, 5:46 pm
Vivek Mapara Vivek N. Mapara

Re: Purchasing property

No, bank will not issue cheque to second owner. A power of attorney neither creates any right , title or interest in the property. Only a registered sale deed can get the title transer. So in eye of law, only the first person is the real owner of the property, and not the second.

I advise you not to purchase property merely on the basis of power of attorney.

Feel free to contact

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Answered on 3/20/08, 2:15 pm
Aniruddha Pawse Aniruddha.P.Pawse Advocates

Re: Purchasing property

No bank will not issue cheque to second owner

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Answered on 3/23/08, 6:00 am
J. Radhakrishnan independent Practice

Re: Purchasing property

The problem can be solved by the owner principal issuing a letter that since he has received the price from the power of attorney holder, he has no objection to the Bank issuing a cheque in favour of the attorney and such cheque shall be treated as payment made to him.

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Answered on 3/21/08, 4:44 am


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