GPA Sales in Bengaluru: Why the Supreme Court Says Your Power of Attorney Is Not a Title

The site near Anekal is 20 percent below market, and the seller is direct about why: no registration, saab, we will do GPA. He hands over a bundle that looks impressively legal, an agreement of sale, a general power of attorney, sometimes a will thrown in for comfort, and asks for nearly full price. Thousands of Bengaluru plots and not a few flats have changed hands exactly this way, and the buyers believe they own something. In 2011, the Supreme Court of India examined this bundle in Suraj Lamp and Industries versus State of Haryana and said, in effect: you do not. No registered sale deed, no transfer of title. Fifteen years later the GPA market still operates on the city's periphery, selling discounts that are actually risk.

The short answer. A general power of attorney is not an instrument of transfer. The Supreme Court held that the popular SA/GPA/Will bundle, agreement of sale plus power of attorney plus will, conveys no title and creates no interest in immovable property; only a registered deed of conveyance does. The trade-off being sold to you in a GPA deal is precise: a price discount and saved stamp duty today, in exchange for holding paper that is not ownership, cannot be mortgaged normally, and collapses under the seller's death, debts or dishonesty.

What is a GPA sale, and why does anyone offer one?

In a GPA sale, the seller takes your money but never executes or registers a sale deed. Instead you receive an agreement of sale, an unregistered promise; a general power of attorney authorising you to deal with the property; and often an unregistered will bequeathing it to you. The package exists for one historical reason the Supreme Court named bluntly: avoiding stamp duty, registration charges and capital gains tax, and absorbing unaccounted money. In Bengaluru it clusters where registration is difficult or expensive, revenue pockets, sites without proper conversion or khata, properties tangled in family shares, and it is pitched hardest to buyers stretching for land they cannot quite afford through the front door. The discount is not generosity. It is the market pricing the absence of title.

What did the Supreme Court actually hold in Suraj Lamp?

The judgment, delivered in October 2011, is unusually quotable, and analyses such as the Delhi Law Academy's case summary and WritingLaw's explainer agree on its pillars. A transfer of immovable property by way of sale can only be by a deed of conveyance, a registered sale deed, without which no interest or title passes. An agreement of sale creates no proprietary interest, only contractual obligations, a position anchored in Section 54 of the Transfer of Property Act. A power of attorney is not an instrument of transfer, and the court was explicit that even an irrevocable power of attorney does not transfer ownership. A will takes effect only on death, is freely revocable until then, and transfers nothing while the seller lives. The court also recorded why the practice flourished, evasion of duty and the circulation of black money, and found existing legislative patches insufficient, which is why it addressed the practice head-on.

What does each document in the bundle actually do?

Lay the GPA bundle next to the real thing and the gap is visible.

Notaries and small-denomination stamps decorate these bundles precisely because real registration is absent; ceremony substitutes for law.

Read the GPA row twice, because it carries the cruellest mechanism in this market: a power of attorney is agency, and agency dies with the principal. The seller's death does not merely complicate your position; it extinguishes the instrument you were relying on, and you negotiate next with his heirs, who signed nothing.

Why does the GPA market still exist in Bengaluru?

Because the inventory it moves often cannot pass through honest registration in its current condition: unconverted agricultural land sold as sites, layouts without approvals, properties inside family disputes, holdings whose papers would not survive a bank's legal scrutiny. The GPA wrapper conceals, for a while, what a registration attempt would expose. Some buyers know this and gamble; most genuinely do not, because the bundle is notarised, stamped in small denominations, and ceremonially handed over in ways engineered to feel official. A useful diagnostic for any deal: ask why this property cannot simply be sold by registered deed today. There is always an answer, and the answer is the actual product you are being asked to buy. Our guides to plot approvals and DC conversion and the encumbrance certificate cover the checks that expose these properties early.

What actually goes wrong for GPA buyers?

The failure modes are not exotic; they are Tuesday. The seller, still the legal owner, sells the same property again by registered deed to someone else, and that buyer's title beats your bundle. The seller's creditors attach the property, because it is still his asset. The seller dies, the GPA lapses, and heirs who received nothing from the deal assert their shares. The will surfaces alongside a newer will. You try to raise a loan and discover no mainstream lender accepts GPA paper as security. You try to sell and find your only market is the next GPA buyer, at the next discount. Khata, tax records and utilities stay in the seller's name, and decades later your children hold a folder of expired agency documents against a property the revenue records never knew they touched. None of this requires villainy; ordinary mortality and ordinary debt are enough.

There is also a quieter, more respectable cousin of the GPA sale that deserves the same suspicion: the indefinitely pending registration. The seller executes the agreement, takes most of the money, hands over possession, and the registered deed is always next month, after the khata, after the conversion, after the partition among brothers. Each delay has a plausible story, and each month the buyer's leverage decays while the discount they received quietly converts into the seller's interest-free loan. The Suraj Lamp logic applies in full: until the deed is registered, nothing has been conveyed, and a buyer in possession without title is in a stronger position than a GPA holder only by degree. If a closing cannot happen within a defined, short window, the transaction should be restructured so money and title move together, or it should not happen.

When is a power of attorney legitimate in a property deal?

The Supreme Court took care to protect the honest uses, and the Delhi Law Academy summary highlights the carve-out: genuine transactions where an owner grants a power of attorney to a family member or friend to manage or complete formalities remain perfectly valid. The NRI who empowers a sibling to sign at the Sub Registrar Office, the elderly parent who authorises a child to manage a flat, the developer operating under a registered development agreement: these are agency used as agency, alongside a real registered conveyance, not instead of one. We described the careful construction of such a POA in our NRI buying guide. The test is simple: a POA that helps execute a registered deed is a tool; a POA offered in place of a registered deed is the scheme this judgment ended.

How should a buyer respond to a GPA proposition?

1. Treat any offer of sale through GPA, agreement and will, without a registered sale deed, as a disclosure that the title cannot survive registration.
2. Ask directly why the property cannot be conveyed by registered deed today, and verify the answer independently rather than accepting the story.
3. Walk away from discounts priced on skipped stamp duty; you are not saving the duty, you are forgoing the title it buys.
4. If you already hold GPA paper on a property, consult a lawyer about completing a registered conveyance from the owner or heirs while they are alive and cooperative.
5. Never lend purchase money against a GPA bundle's promise of future registration; pay at the registered deed, in the SRO, or not at all.
6. Use powers of attorney only alongside registered conveyances, drafted narrowly, for execution convenience, never as the ownership document.
7. Run the standard verification stack, EC, khata, conversion, approvals, on any peripheral plot before any money moves, whatever the document structure.

Is buying property through a GPA legal?

A power of attorney is legal as agency, but it transfers no ownership. The Supreme Court held in Suraj Lamp that SA/GPA/Will bundles convey no title and that immovable property passes only by a registered deed of conveyance, so a GPA purchase leaves the seller as the legal owner.

Does an irrevocable GPA protect the buyer?

No. The Supreme Court stated that even an irrevocable power of attorney does not transfer ownership. The label changes the contract between you and the seller, not the title, and the instrument still terminates on the seller's death, leaving you to negotiate with heirs who signed nothing.

Can I get a home loan on a GPA property?

Mainstream lenders do not accept GPA bundles as security, because there is no registered title to mortgage. The absence of institutional finance is itself a signal: the market that prices risk for a living has already declined the paper you are being offered at a discount.

I already bought through GPA years ago. What should I do?

Consult a property lawyer about completing a registered conveyance now, from the original owner if alive or the legal heirs if not, paying the proper duty. It costs money, but it converts expiring agency paper into title, and every year of delay shrinks the set of people who can sign.

Last updated 2026-06-12. PropNewz Team.