Poa question

A POA Holder (POA assignee) bears full resposibility, same as that of POA assigner.

But a POA assigner is always deemed to have assigned POA to do all 'legal' acts, therefore even if POA was issued by POA assigner still it will be considered that who actually committed the illegal act.

In your case, it is 'B' the POA assignee who has misused the POA, therefore he is liable. He cannot escape from clutches of law.

Thanks a lot Sandeep for your inputs and valuable time.

So just to revisit my understanding.

In my case it seems B had plans to cheat from begining. What he has done here is, he made A (A poor and uneducated person) the director of the company and taken full power of attorney from A. Then did some cheating in land transactions and also the checks issued by him bounced.

If we trap A under leagal matter we are not likely to get our money back. Also we want to trap B in particulat as he is the mastermind and has all the money.

What I understand from your inputs is B can be trapped completly if he has signed the check which has bounced, because POA gives full power for leagal transactions but not to commit illegal actions. Is this correct understanding. 

Please confirm. It makes me feel better that we can trap the real cheaters in the systems.

Yes, your understanding is correct.

if 'B' has signed the documents/cheques then he is completely liable for that act.

You can even sue 'B' directly, because when he signed, he had full authority (POA) from 'A'.

But as I said earlier, 'A' cannot be said to have authorised 'B' to commit fraud/illegal acts.

I disagree with the opinion expressed by Ld. Memeber Mr. Sandip Naik.

The only thing that matters to apply the theory of 'Vicarious Liability' is whether during such fraud the agent was in the course of employment or not. The legality or illegality of the act doesn't matter in such a case. Also whether the issuer of POA is uneducated or educated doesn't matter.

'Master must be liable for the illegal act of the his agent/servant as long as he does such illegal act during the course of employment'

Note-This reply should be taken as per the declaration given in my profile page.

Thanks,

Regards,

Any POA in general will have following line;

All the acts lawfully done B in pursuance to this POA shall stand ratified by A......

So it is clear that A does not take any explicit responsibility for any unlawful acts of B, thats where the question of vicarious liability comes

into picture. The honorable SC, while hearing a case of multiple directors brought into the folds under S.138, expressed caution that in order

to even fix (and to start the process) the complainant has to specifically allege the involvement of such directors, mere statement alone is

not sufficient. That means SC has not accepted the blind role of vicarious liability with respect to criminal matters. So the statement above by

Mr Sumitra Kumar that master must be responsible for the acts of .... has to be analysed carefully

Ex1: "B" creates some liability in the normal course of business under POA and runs away:  "A" is responsible to settle the same.

Ex2" "B" binds A in some contract under this POA :  "A" has to honor the contract.

Ex3: "B" deposes falsely infront of court under this POA for some case.  " B" may face perjury, not A.

Ex4  Cheque signed by "B" for discharge of liability created in normal course under POA bounces"

This will answer your question: A is responsible to settle this liability, he cannot run away from the liability if pursued, but criminality aspect cannot 

be put on 'A" vicariously. That means 'A" if gets dragged then he can prove that he was not involved in the issuance of cheque. So, you can pursue the criminal case under S.138 against B itself, but if you wish to file a civil recovery case you must involve both A and B.

Thanks a lot for your inputs.