Maharashtra, India · property

Can an SRA Flat Be Sold Through Power of Attorney in Maharashtra?

In Maharashtra, an SRA flat cannot legally be sold or transferred using a General Power of Attorney (PoA) or notarized agreement. State law and binding court rulings strictly prohibit indirect sales, leaving buyers vulnerable to immediate eviction and total loss of their investment without conferring legal title.

What the Law Says in Maharashtra

Under Section 3E of the Maharashtra Slum Areas (Improvement, Clearance and Redevelopment) Act, 1971, rehabilitation tenements allotted under Slum Rehabilitation Authority (SRA) schemes cannot be transferred by way of sale, gift, exchange, lease, or otherwise during the statutory lock-in period. Even after the lock-in period expires, any valid alienation requires prior written permission from the Chief Executive Officer of the SRA, payment of state transfer premiums, and execution of a registered conveyance deed.

The Supreme Court of India established in Suraj Lamp & Industries Pvt. Ltd. v. State of Haryana (2011) that a Power of Attorney is merely an agency document and does not convey ownership, title, or interest in immovable property. Reinforcing this in Maharashtra, the Bombay High Court (in decisions such as Mrs. Chhaya Kashinath Shinde v. State of Maharashtra) held that the statutory bar under Section 3E encompasses indirect transactions, ruling that executing a Power of Attorney and delivering possession constitutes an illegal transfer.

Under Section 3E(2) of the Act, the SRA Competent Authority possesses summary powers to evict unauthorized occupants and seize tenements transferred in breach of the statute. A buyer purchasing on a Power of Attorney acquires zero legal title, cannot register the property with the sub-registrar, and has no legal standing against administrative eviction.

Unmasking the Power of Attorney Trap

Unscrupulous sellers, brokers, and predatory middlemen frequently market SRA flats at steep discounts, assuring prospective buyers that a 'notarized PoA and agreement to sell' offers complete protection until the statutory lock-in lapses. This is fundamentally untrue and designed to offload encumbered property onto unsuspecting purchasers.

A Power of Attorney automatically terminates upon the death of the principal (the original allottee) and can be unilaterally revoked by the original owner at any point, leaving the purchaser with no documented defense against dispossession. Furthermore, banks will not issue housing loans against PoA transactions, and cooperative housing societies are legally barred from recognizing PoA holders as lawful members.

What You Can Do Next

If you have already paid money or taken possession of an SRA flat through a Power of Attorney, you must act before the authority initiates eviction proceedings under Section 3E(2). Review your paperwork immediately to ascertain the allotment date, the exact wording of all affidavits, and whether the original allottee is still reachable and willing to cooperate.

Depending on your timeline and whether the statutory lock-in has lapsed, remedies may range from pursuing formal regularization and NOC approval to filing a suit for specific performance or recovery of money against a defaulting seller. You can use Caunsel to research applicable SRA notifications, organize and securely store your transaction documents in a case file, or connect with an independent property lawyer to evaluate your legal standing.

Steps

• Verify the official allotment date from the SRA Sanction Order or Annexure II to determine whether the tenement has completed the mandatory lock-in period.
• Demand all original title documentation, including the primary allotment letter, possession letter, and Society Share Certificate, rather than relying on notarized xerox sets.
• Audit all executed instruments to see if you hold a simple revocable Power of Attorney, a notarized memorandum of understanding, or an unregistered agreement to sell.
• Engage with an independent legal professional before responding to any SRA inquiry, society show-cause notice, or eviction summon under Section 3E.

Common mistakes

• Assuming that getting a Power of Attorney notarized by a notary public gives you legal ownership or title to the property.
• Believing that local housing society maintenance receipts or electricity bills in your name legitimize an illegal SRA sale.
• Paying cash consideration to an allottee or broker without obtaining an official No-Objection Certificate (NOC) directly from the SRA.
• Ignoring formal show-cause notices from the SRA Competent Authority, which leads to immediate ex-parte eviction orders under Section 3E(2).

Questions people ask

Can an SRA flat ever be sold legally in Maharashtra?

Yes, but only after the statutory lock-in period has expired, upon obtaining written prior permission (NOC) from the SRA, paying the prescribed state transfer fee, and executing a properly stamped and registered sale deed.

What happens if the SRA discovers I am living in an apartment bought via Power of Attorney?

Under Section 3E(2) of the Maharashtra Slum Areas Act, the Competent Authority can issue a show-cause notice and order your eviction using police assistance if required, taking back the flat into government custody.

Can the original allottee cancel the Power of Attorney after taking my money?

Yes. A Power of Attorney can generally be revoked by the grantor at any time, and it automatically becomes invalid upon the grantor's death, exposing the buyer to title disputes and immediate claims from legal heirs.

General information only, last updated 2026-10-12. Caunsel is not a law firm and does not practise law. AI answers and this guide are not legal advice. Verify filings, deadlines, and statutes with a licensed lawyer in Maharashtra, India.