CHENNAI: The state registration department on Saturday increased the fee for issuing power of attorney for non-family members from Rs 10,000 per document to one per cent of the guideline value of the property. As per the new fee, power of attorney issued for a property worth Rs 1 crore, which would have cost Rs 10,000, will now cost Rs 1 lakh. Realtors said the hike may lead to increase in property rates as developers may pass on the new charges to customers.
President of Confederation of Real Estate Developers’ Associations of India (CREDAI) S Sivagurunathan said, “If there is a hike of 1%, the impact on property price may be around Rs 100 per sq ft.”The fee revision, announced after nearly 20 years by the registration department, may make 20 services, including mortgage cancellation receipt registration fee, dearer.
The registration department’s announcement, however, was not clear on how much would a developer or an individual must pay as power of attorney fee for joint venture agreements, where the developer gets a portion of the developed property from the owner. This has created confusion among developers.
The other major service for which fee has been hiked is for settlement deed, partition or sign release documents among family members. While the maximum registration fee for this has been increased from Rs 4,000 to Rs 10,000, the maximum stamp duty has been increased from Rs 25,000 to Rs 40,000.
Similarly, the fee for individual plot registration has been increased from Rs 200 to Rs 1,000. Usually, the charges are for people who are sick or immobile or for VIPs where registration officials will go to their houses to register the plot.
The increase in power of attorney fee has been welcomed by some officials. According to former additional inspector general of stamps and registration (law officer) A Arumuga Nainar, the move would make people think twice before getting power of attorney for a property. Usually, power of attorney is being used for opaque transactions. In other states, steps were initiated to end their misuse by increasing the fee to nearly 4% of guideline value. Nainar said the move would end the practice of carrying out high-value transactions through power of attorney.
Settlement deed fee up
Fees for settlement deed, partition or sign release documents among family members has also been increased.