Eight Rulings by Indian Courts That Impact Your Finances Essay

1247 Words Sep 29th, 2012 5 Pages
It's the final frontier. Many a hapless investor has boldly come here, seeking respite. Some find closure, others crawl out disappointed, but virtually all are branded by the verdict. We refer to the Indian courts, which are deluged by a daunting number of cases every year. The spectrum is as staggering, with a large percentage falling in the realm of personal finance, be it the house an heir is battling his kin for possession (real estate), a claim that an insurer refuses to settle (insurance), or the loan that the guarantor is to pay (banking). Even as these cases impact people's finances, some leave purging precedents, expanding the scope of an argument, lending clarity to an obfuscating rule, plugging loopholes, or giving direction …show more content…
2) No property sale on general power of attorney

A three-judge bench of the Supreme Court, presided over by Justice RV Raveendran, held that using the general power of attorney (GPA) for the sale of immoveable property was not a valid form of transfer.

This was a landmark judgement aimed at improving transparency in the real estate sector, which is marked by opacity. Though the ruling put many a home buyer and seller in a quandary for a while, it has opened up the way for cleaner transactions. A registered deed of conveyance translates to a safer deal because the records prove the sale even if you lose the document or it is destroyed. Guarantor liable to repay loan if debtor defaults

Uttar Pradesh's Ganga Kishun had appealed in the Supreme Court against the state government's decision to recover loan arrears worth Rs 8,500 from him after the death of principal debtor Ganga Prasad.

Kishun had been the guarantor to a bank loan raised by Prasad, who died without clearing it. The court ruled that the government had the right to recover the amount from the guarantor.

This again is an important judgement since it will provoke people into thinking twice before becoming a guarantor for a bank loan. Since it establishes the liability of the guarantor as being co-extensive with the debtor, it means that if the debtor defaults or dies or is unable to repay the loan, the entire responsibility of doing so

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