In Indian property law, inherited property refers to immovable assets, such as residential flats, agricultural land, or commercial buildings, that pass to the closest living relatives of the original owner, known as legal heirs, upon their death. Succession can arise through a will (testamentary succession) or, where no will exists, through intestate succession.
Where an NRI legal heir has inherited property but is unable to travel to India, they may send a Power of Attorney to India, enabling the heir to authorise a trusted individual to complete legal formalities on their behalf. This includes the ability to transfer the property into the name of the legal heir and sell the inherited property on their behalf.
In this post, we discuss how NRIs can lawfully sell inherited property in India through a Power of Attorney (POA).
Who Can Inherit Property in India?
Anyone can inherit property in India, provided they are named in a valid will or fall within the recognised legal category of heirs under Indian succession law. For example, a surviving spouse and children of a deceased property owner would typically inherit the estate by operation of law. Similarly, a will may direct that a specific family member or relative, such as a niece, sibling, or even a non-relative, shall inherit a particular property upon the owner’s demise, provided it complies with applicable testamentary rules.
If the deceased left a valid and registered will, the property devolves according to its terms. In cases of intestate succession, inheritance is determined by the laws relevant to the deceased’s religion, such as the Hindu Succession Act 1956 or the Indian Succession Act 1925.
Heirs may include children, spouses, parents, or siblings, depending on the statutory class of successors. If the legal entitlement is disputed or unclear, a succession certificate issued by a competent civil court may be required.
For Non-Resident Indians (NRIs), inheriting property in India follows the same legal principles. However, they must undertake additional procedures to formalise ownership. Inheritance alone does not confer full legal title. The title must be perfected by effecting a mutation (transfer of title) in the land revenue records before the property is sold.
Why NRIs Sell Inherited Property and Use a Power of Attorney
It is quite common for NRIs to inherit residential or ancestral property in India. In many instances, the beneficiaries may have no intention to retain the property. Instead, they wish to realise its value for financial or practical reasons. In such cases, the law permits the NRI to authorise a trusted family member, legal representative, or other reliable individual to act on their behalf by way of a duly executed Indian Power of Attorney. This allows the entire transaction, from mutation to sale deed execution, to be carried out without the NRI having to travel to India.
Can I Use a UK Power of Attorney in India?
A Power of Attorney prepared under UK law cannot be used to carry out property transactions in India. The legal structure, recognition, and enforceability of a UK Power of Attorney differ significantly from those required under Indian law. Indian authorities, including Sub-Registrars and land revenue offices, do not accept foreign PoAs for property matters unless they are executed as per Indian legal requirements. Therefore, NRIs must create a separate Power of Attorney that complies with Indian legal standards.
Appointing a Power of Attorney to Sell Inherited Property
Using a Power of Attorney (POA) is the preferred method for NRIs who wish to sell inherited property in India without being physically present. The POA must be executed before a Notary Public and Indian Consulate in your country of residence and sent to India for adjudication within 90 days.
The Indian Power of Attorney should authorise the attorney to:
- Represent you before the Sub-Registrar and all relevant authorities
- Sign and execute the agreement to sell and the sale deed
- Collect and deposit consideration on your behalf and issue receipts
- Pay applicable taxes and duties
- Deliver physical possession of the property to the buyer
In cases where there is more than one legal heir, multiple individuals may create a joint Indian POA if they can execute the POA altogether.
Whytecroft Ford assists clients in drafting compliant Power of Attorney documents that are accepted by Indian authorities and tailored to meet the legal requirements for property transactions. To discuss your situation, get in touch with our team on 0208 757 5751 or use our contact form.
Title Mutation Following Inheritance
Before the sale can proceed, the property must be mutated into the name of the legal heir or heirs, where multiple heirs are involved. Mutation is the official process of updating the land revenue records to reflect new ownership. This step requires submission of the original property documents, the previous owner’s death certificate, and legal proof of inheritance such as a will or succession certificate. Only once the mutation is complete can the attorney proceed to execute the sale on your behalf.
Obtaining Tax Clearance for the Property
A tax clearance certificate from the Indian Income Tax Department is necessary before finalising the sale. This document certifies that all applicable taxes, such as municipal taxes and capital gains, are up to date. Without this certificate, the transaction may be delayed or challenged.
Drafting and Executing the Sale Agreement via POA
Once legal title and tax status are verified, your attorney can draft and execute a sale agreement. This contract sets out the agreed price, payment terms, and conditions of the sale. The Power of Attorney holder must be explicitly authorised to sign and bind you to the agreement.
Registering the Sale Deed with the Sub-Registrar
The final transfer of property ownership occurs through the execution and registration of the sale deed. This must take place at the Sub-Registrar’s office where the property is located. Your attorney, armed with the adjudicated POA, will sign on your behalf. Two witnesses must also be present.
Stamp duty and registration fees must be paid in accordance with state-specific rules, and payment receipts must be submitted at the time of registration.
Compliance with FEMA for NRI Sellers
The sale of inherited property by an NRI must comply with the Foreign Exchange Management Act (FEMA). The sale is typically allowed to a person resident in India or another NRI or OCI, provided it meets FEMA guidelines.
Funds received from the sale must be deposited into a Non-Resident Ordinary (NRO) account in India.
RBI Approval for Repatriation of Sale Proceeds
If you intend to transfer sale proceeds abroad, you must seek approval from the Reserve Bank of India (RBI). Repatriation is permitted subject to proper documentation and eligibility.
Why Use a Power of Attorney for Selling Property?
For many NRIs, travelling to India to execute a property sale is impractical. A Power of Attorney provides a secure, legally valid alternative that allows you to:
- Appoint a reliable representative to act on your behalf
- Complete complex property formalities without personal presence
- Ensure continuity of the transaction without delays
- Avoid risks of non-compliance and improper execution
By ensuring the Power of Attorney is correctly structured, witnessed, and adjudicated, the property transaction can proceed without hindrance.
How Whytecroft Ford Can Help
Whytecroft Ford offers expert legal assistance for NRIs looking to sell inherited property in India through a Power of Attorney.
Visit our Indian Power of Attorney Services page or contact our friendly professional team on 0208 757 5751 or use our contact form.
