Why a GPA Sale Leaves Bangalore Property Buyers Without Title

Picture being offered a plot on the edge of Bangalore for a price that seems too good, with one condition: the paperwork will be an agreement plus a power of attorney, and no registered deed. The seller explains that this avoids stamp duty. The questions below cover what such papers really give, how the courts see them, and what a careful buyer does instead.

Is a GPA a Transfer of the Property?

It is not. This instrument is a letter of authority. The owner, called the principal, lets another person act in the owner's place on matters that can include signing property papers.

Ownership never leaves the principal. The agent can sign things on the principal's behalf and nothing more, so the document alone moves no right in the land or building to the agent or anyone the agent deals with.

Why Do Such Deals Exist?

For decades in many Indian cities, a package of papers served in place of a conveyance. It held an agreement to sell, a power of attorney naming the buyer, a sworn statement, a payment receipt and often a will. Everyone acted as if a sale had happened, though none of the duty or registration charges had been paid.

Layouts without approval and unconverted revenue land on the urban fringe were typical examples. Sellers with defective ownership also found the route convenient, because it avoided the scrutiny that registration brings.

What Has the Supreme Court Said?

The October 2011 Suraj Lamp judgment is the landmark. According to it, a registered conveyance is the only way to move land or a building from one person to another. A transaction stitched together from an agreement, a power of attorney and a will conveys neither title nor interest, because it exists mainly to evade duty and registration.

More recently, on 1 September 2025, came the Ramesh Chand decision. The bench repeated that an agreement, power of attorney, affidavit and receipt do not pass ownership. It added that even a registered will confers no title unless proved in law.

The part that still works

The 2011 judgment protected honest use of the instrument. An owner can authorise a husband, wife, son, daughter, relative or manager to complete a sale. That person signs a registered deed in the owner's name, and title flows from the deed.

What Exactly Is the Danger?

A buyer holding a GPA bundle faces trouble from several directions:

• Since ownership has not changed, the seller and the seller's family can still claim the property
• The principal can cancel the authority whenever he or she likes, and it comes to an end at death
• A will made for the buyer can be rewritten freely and operates only after the maker dies, if proved
• Banks normally will not lend on a property that has no registered sale deed
• The next purchaser discovers the same flaw, which pushes the resale price down
• Municipal records and the khata resist transfer to the buyer

An unregistered agreement gives little help on possession either. Under Section 53A of the Transfer of Property Act, in its form since 2001, a buyer in possession is protected only if the agreement is registered. A person living in a home on loose papers is therefore open to a lawsuit by the owner.

What Is the Seller Really After?

The pitch is the saving on duty and fees. That saving is real in Karnataka, where stamp duty can reach 5% with surcharges and registration is 2%, yet the seller uses it as a sales line while the buyer is left holding the risk.

Sometimes the true reason is that no registered deed can be produced. The land may be farmland that was never converted, the layout may be unapproved, or the seller might have only a GPA from another person. The discount in these cases is the price of a defect that the buyer inherits.

Red flags in practice

These patterns often accompany a GPA trap:

• A rate far below neighbouring properties, available only if the buyer accepts a GPA
• A middleman who claims to represent an owner nobody ever meets or reaches by phone
• Earlier owners in the chain who also bought on agreements and powers of attorney
• Urgency about paying an advance before any lawyer has examined the originals

When Is a Power of Attorney Fine?

It is fine when it is only the way a registered deed gets signed. Take an owner working overseas who asks a relative living in Bangalore to close the sale. The buyer receives a registered conveyance, and the power of attorney simply lets the relative sign for the owner.

A lawyer acting for the buyer should check:

1. The person granting it is the recorded owner, with an unbroken chain of title
2. Its wording clearly permits selling this very property and signing the deed
3. It is registered or properly stamped, even if it was signed in another country
4. The owner is living and has not withdrawn it, ideally confirmed in a conversation with the owner
5. Money goes into a bank account held by the owner, never the agent

Where a seller's rights rest on nothing more than an old bundle of papers, the remedy is a fresh registered conveyance from the real owner or the legal heirs. Some owners agree to this for a fee. Until it happens, the property should be viewed as not belonging to the seller.

The Simple Rule

Whether the purchase is a site or an apartment in Bangalore, payment should follow the registered deed signed by the owner of record. Complete the file with an encumbrance certificate, khata, property tax receipts and a lawyer's view on title. Our team can go through the documents of a resale property; write via the contact page.