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The government of Gujarat has implemented new procedures to prevent fraud in the sale of properties belonging to Non-Resident Indians (NRIs). The revenue department has issued two circulars this month outlining the new rules. As per the circular, from now on when an NRI grants power of attorney to a representative to sell a property, they must also send a notarized declaration confirming that they were alive at the time of the sale. This declaration must be sent in a sealed envelope and opened only in front of the sub-registrar. The representative can be a blood relative or a third party.
The revenue department notification elaborates that the NRI must file the declaration from the application date for execution of the sale deed. "The declaration must be registered with the sub-registrar's office," says a senior revenue official. This means that the NRI owner will have to file a separate declaration and post it in a sealed cover to the sub-registrar. The declaration by the NRI seller should consist of the date, preferably a day after the filing of the sale deed.
The NRI seller issuing a power of attorney has to state in the separate declaration on a Rs 50 stamp paper that s/he is alive; that they have neither withdrawn nor cancelled a power of attorney issued, and that no litigation or dispute is pending in any court or tribunal in India regarding the property in question. The NRI seller also has to certify that it will be their responsibility if the transaction is found to be fraudulent, adds the revenue official.
These rules have been put in place to prevent cases of fraud where buyers purchase properties belonging to NRIs through individuals with power of attorney, only to later find out that others have a stake in the property. There have been many cases in Ahmedabad and other cities in Gujarat where buyers bought properties belonging to NRIs through people armed with power of attorney, only to find later others claiming their stakes in the property.
With these new procedures the state government hopes to ensure that the fraudulent sales of properties belonging to NRIs are checked and prevented. By introducing such initiatives, the authorities believe they have added an extra layer of security to the sale process and helped in protecting the rights of NRIs and their properties. The government is taking steps to ensure the transparency and fairness of the property transaction process and prevent any fraudulent activities.
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