Valuation of Immovable Assets in India for Misuse of power of attorney – Court Case in the USA

ABSTRACTS

This is the practical case of misuse of the power of attorney and the sale out of property continuously four times within the family members. This is the case of selling of the property by the way of strategy & criminal conspiracy. The case was filed in the Honorable Court of USA. This paper is on the practical case of valuation to showcasing misuse of the power of attorney and continuous repetition of the same photograph in all transactions.

Key Words: Power of attorney, Plaintiff, defendant, testimony, conspiracy

1.	Valuation took up at the request of	:	Mr. W Residing in New Jersey, USA
2.	Purpose of Valuation	:	To Ascertain the present market value of subject property
3.	Name of Client	:	Mr. W
4.	Date of Valuation	:	dd.mm.yyyy
5.	Court	:	Honorable Court of USA

Brief Introduction about subject Property:

1	Purpose of valuation	:	To Ascertain the present market value of subject property
2	Brief Description about the Property	:	Commercial property
3	Location, Street, ward no.	:	GF, Rahul Chamber, Amitnagar, City: XXX, State: XXX, India
4	Person/s accompanying / available at the time of site inspection/visit	:	Adv. Mr. W.
5	Boundaries of the property (As per site)	:	North: Road	East: Road
5	Boundaries of the property (As per site)	:	West: RS No.52/P	South: RS No.52/P
6	Classification of the locality	:	Middle-class locality
7	Availability of Electricity, Water supply, sewerage disposal arrangements	:	Provided
8	Availability of civic amenities like schools, hospitals, markets, etc.	:	Within 2 to 3 Km
9	Documents Persued	:	XXX documents
10	Area of the property	:	148.70 sq. mt
11	Name of Tenants – lessee/licensees etc.	:	HIJ (Nationalized Bank)
12	Type of Construction	:	RCC frame structure
13	Age of the Property	:	35 years old
14	The residual life of the property	:	25 years, depends upon the maintenance
15	Door and windows	:	Collapsible gate & aluminum glazed sliding window

Scope of Valuer:

In the subject case, our scope is restricted up to ascertain present market value as on today which is around 29.74 lacs only however other valuations obtained by the plaintiff were around 2.50 CR. However, we furnished all relevant / supporting documents to furnish our valuation. The subject premise is given on a long-term lease to HIJ – Nationalized Bank. The case filed in the court of USA against was around $40,000,000.00 however later it was settled on the compromised basis in $40,000.00 only.

Brief about the Case:

The scope of the valuer is restricted up to ascertain present market value however for a valuer, it is interesting to know the criminal conspiracy behind this case & how can fraudulent / misuse of power of attorney.

Four friends jointly purchased a property in the year 2000. Three friends give POA to the fourth’s wife & criminal conspiracy took place afterward with the purpose to eliminate the other three friends from this property

To constitute a valid and legal power of attorney in India:

Purchase an Rs.100.00 stamp paper (As per Gujarat Stamp Act) from a licensed stamp vendor. (This stamp was purchased from stamp vendor Mr. ‘P’ in march, 2012 by Mr. ‘A’. who is cousin brother of Mr. ’B’.
Mr. ’B’ is one of the co-owners who expired in 2014. The addresses as one can read are of USA given by the said Mr. ‘A’.)
The power was drafted and printed at City: XXX, State: XXX, India.
These powers are notarized at City: XXX and as one can read the signatures were done / put at City: XXX before the concerned notary. The power shows, both place & Date, very clearly.
Mr. ‘A’ cousin brother of Mr. ‘B’ is the person who can answer the question as to who had signed these powers before Notary in City: XXX. This was done in conspiracy with Mr. ‘A’ and Mr. ‘B’. Thus, these powers were ready for the intended use as a legal and valid power of attorney. There is absolutely no need for any other notary like Mr. ‘R’ at New Jersey to sign it or stamp it or put his seal on it. Had Mr. ‘R’ USA; not signed the same and put his seal on these power of attorneys, they were self-sufficient and Mrs. ‘C’ could have easily used them for the intended purpose/task.

Comments:

1 The grantors/executors of these powers of attorney are admittedly permanent residents of the USA. This can be confirmed from their passport as well as declared on the stamp paper used by Mr. ‘A’ & Mr. ‘B’.

2 Now the usual practice and procedure for a person residing in the USA and decides to give / grant/issue / execute a power of attorney to a person residing in India is that he/ she gets is drafted/prepared the draft in the USA, get it notarized in the USA before a notary public in USA. Admittedly, No stamp is required in the USA, therefore, it has to print on plain paper. Once it is notarized and sealed by a notary in the USA, It is sent to India to that person.

3 Once the person in India receives the same, he needs to get is registered within 90 days from such receipt. For such registration, there is a procedure and process i.e.

Submit the same to the concerned sub-registrar office with a photocopy. The same office will give challan/invoice to deposit money to pay the requisite stamp duty. One has to pay/deposit Rs.100.00 in Bank, Government branch as a government payment.
Once this is done, one needs to inform and show the receipt to the sub-registrar. The sub-registrar sends the said power of attorney to the collector for the necessary order. After scrutiny, the collector passes an order and allows it to be stamped, and sends it to the treasury officer, government.
The treasury officer affixes an adhesive stamp of Rs.100.00 and sends it back to the sub-registrar who is turn gives it back to the person to use.

4 In our case, the persons giving power of attorney to Mrs. ‘C’ have not done so and instead of that Mr. ‘A’ at the instance of late Mr. ‘B’ (husband of Mrs.’C’) got all the powers prepared in City: XXX, India, signed / forged them in City: XXX, India and got it notarized in City: XXX, India. Late Mr. ‘B’ is one of the owner / Joint owners of the disputed property. This is clear criminal conspiracy between Mr. ‘B’, his wife Mrs. ‘C’ and cousin brother Mr. ‘A’. (It is very well known that the case filed against Mrs. ‘C’ at court of USA was withdrawn / voluntarily got it dismissed by the other four joint owners – plaintiffs in the present case, More specifically Mr. ‘D’ as a part of the criminal conspiracy). Mr. ‘D’ is the brother of Mr. ‘B’.

5 Very interesting to know and note that late Mr. ‘B’ had a valid power of attorney of all plaintiff herein ever since 1984 and it was never revoked. This was good enough to be used and transfer the property. But it never happened. On the Contrary on Z^th April, 2012 four other new powers of attorney were prepared by Mr. ‘B’ (Who is in India) in favour of his wife with the help of his cousin brother Mr. ‘A’. You will be surprised and shocked to see that ultimately this property has come to the sons of Mr. ‘B’. This was the ultimate goal of Mr. ‘B’.

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Now if we take into consideration the series of sale deeds and planning in to account:

1 Sale deed No.1

Z^thDecember, 2000.
Consideration amount: Rs.4,10,000.00
Seller: Mrs. ‘U’
Buyers: Mr. ‘B’,

Mr. ‘D’,

Mr. ‘E’,

Mr. ‘F’,

Mr. ‘G’

Important to see the Photo of the property affixed in the sale deed above the sale deed. The same photo of the property repeats in all four transactions. [Four sale deeds]. The same photo of the property repeats after 12 years. It is an act of the same person and that is Mr. ‘B’. ultimately this property has come to his sons as on date.

2 Sale deed No.2

Z^thJune, 2012.
Consideration amount: Rs.12,00,000.00

Seller: Mr. ‘D’,

Mr. ‘E’,

Mr. ‘F’,

Mr. ‘G’

(these persons have sold and transferred their 80% share in this property to Mr. ‘B’). Here the alleged four powers of attorneys were used by Mrs. ‘C’. (these four-person / co-owners are the plaintiff case. These are four people who have filed a case against Mrs. ‘C’ in the court of the USA and then let it get dismissed voluntarily).

Buyer: Mr. ‘B’

The photo of the property affixed in this sale deed also is identically same. It is an act of the same person Mr. ‘B’ & Mrs. ‘C’.

3 Sale deed No.3

Z^thOctober, 2012. (After 3 months)
Consideration amount: Rs.20,00,000 (Cash Payment)
Seller: Mr. ‘B’
Buyer: Mr. ‘X’ (Brother of Mrs. ‘C’)

The income tax act does not permit an amount more than Rs.5,00,000.00 to be paid in cash.

This is a planned transaction/transfer. Totally bogus.

The picture of the property sold and transferred is the same. It is an act of the same person Mr. ‘B’ and Mrs. ‘C’.

Thereafter Mr. ‘B’ expired in 2014.

4 Sale deed No.4

Z^th March 2014. (After the death of Mr. ‘B’.)
Consideration amount: Rs.22,00,000.00
Seller: Mr. ‘X’ (Brother of Mrs. ‘C’)
Buyer: Mr. ‘M’ & Mr. ‘N’ (Son of Mr. ‘B’)

(Both are sons of Mr. ‘B’. He was holding this property in his name as benamidar (who had nothing to do with it) requested the nephews to take it back as their father Late Mr. ‘B’ had kept if on his name).

The Photograph of the property affixed in this sale deed is identically the same.

It is an act of Mrs. ‘C’, wife of Mr. ‘B’

Valuation:

This property is given on a lease basis to Nationalized Bank. So, valuation on lease method is more suitable however as we see earlier the criminal conspiracy took place time by time it may possible that lease contact with the bank also forged. So we considered the valuation of this property as an open market scenario not lease based method. [Refer page no.1 for property description]

Area of Premises: 148.00 sq. meter

Replace Rate: Rs.25,000.00 /sq. mtr

(Rate derived after considering proper weightages w.r.t obtained sale instance from market inquiry)

Replace Value:Rs.37,17,500.00

Depreciation: @20.00% (based on physical maintaining condition of premises, aged and remaining life)

Depreciated Replacement Value: Rs.29,74,000.00

Observations:

In sale deed number -3, Consideration amount Rs.20,00,000.00 (Cash Payment). Which not permitted by the Income-tax act. “Planned transaction”
Photograph of the property: Continuous repetition of the same photograph in all four transactions even after 12 years also.
It is necessary to see & verify the power of attorney before doing this kind of valuation.