Hey all,

Just need a help from all gurus. I am planning to buy a flat from an NRI. Now since he cannot came he is planning to give power of attorney to his cousin in Mumbai.

Now as per the stamp duty act apart from close blood relatives, POA to any other person woudl attract the stamp duty at 5% (i.e on market value of property. Now we also pay the stamp duty when registering the document

So aren't we paying 10% in stamp duty for a single transaction. This is huge burden. Please correct me if I am wrong and missing something in my reasoning.

Regards
Deepti
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  • In worst case, the stamp duty for the POA will be borne by the Seller and stamp duty for flat will be borne by you. So you are not going out of pocket for any extra amounts.
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  • Originally Posted by mdeepti15
    Hey all,

    Just need a help from all gurus. I am planning to buy a flat from an NRI. Now since he cannot came he is planning to give power of attorney to his cousin in Mumbai.
    ------ If NRI is sending power of attorney to India then POA must be attested by Indian Embassy/ Consulate and POA should have Photo passed on POA and Photo should also be attested by Indian Embassy/ Consulate and then his cousin has to get it Adjudicated in Mumbai...before he can use that POA and POA MUST be Adjudicated in 3 Months from the date NRI or PIO Sign the POA. If the person is PIO(got Citizenship of other country then for POA he will need one extra step. Find out of he/she is PIO or Citizen of India.

    Now as per the stamp duty act apart from close blood relatives, POA to any other person woudl attract the stamp duty at 5% (i.e on market value of property. Now we also pay the stamp duty when registering the document

    So aren't we paying 10% in stamp duty for a single transaction. This is huge burden. Please correct me if I am wrong and missing something in my reasoning.

    Regards
    Deepti

    -----
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  • Originally Posted by mdeepti15
    Hey all,

    Just need a help from all gurus. I am planning to buy a flat from an NRI. Now since he cannot came he is planning to give power of attorney to his cousin in Mumbai.

    Now as per the stamp duty act apart from close blood relatives, POA to any other person woudl attract the stamp duty at 5% (i.e on market value of property. Now we also pay the stamp duty when registering the document

    So aren't we paying 10% in stamp duty for a single transaction. This is huge burden. Please correct me if I am wrong and missing something in my reasoning.

    Regards
    Deepti


    I dont see why you should pay for any stamp duty for the POA or stamp duty that the seller is incurring. Your expenses should be related only to your personal registration costs. Pls negotiate accordingly.
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  • Originally Posted by raccoon
    I dont see why you should pay for any stamp duty for the POA or stamp duty that the seller is incurring. Your expenses should be related only to your personal registration costs. Pls negotiate accordingly.


    Stamp duty on POA has to be paid by the person who gives POA or his/her relative. If the POA holder is close relative then Stamp duty is very less. Buyer has nothing to do with Stamp duty on POA buyer will pay stamp duty for registration of flat on his/her name.
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  • Originally Posted by Gangaram
    Stamp duty on POA has to be paid by the person who gives POA or his/her relative. If the POA holder is close relative then Stamp duty is very less. Buyer has nothing to do with Stamp duty on POA buyer will pay stamp duty for registration of flat on his/her name.


    exactly. Please make sure your seller is not asking you to pay the stamp duty on this POA. That is not your problem.
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  • Yes its a huge injustice to pay a percentage of market value just to give POA to sell if its not a close family member. But thats how our corrupt nation works. I faced the same situation because (for privacy reasons) I did not want to appoint a family member. It turned out cheaper for me to fly twice to India for the sale than to pay 5% charges for a Cr plus property.
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