Power of Attorney (PoA)
Power of Attorney (PoA) has been shown always in bad light courtesy Hindi movies. However it do have both positive and negative side. A Power of Attorney (PoA) is considered a more authentic document and allows greater independence to the holder. One may be able to execute even property transactions on the basis of it. However off late Power of Attorney (PoA) transactions have been stopped as it was giving rise to black money generation. Now one has to get the property registered in the name.
Negatives associated with Power of Attorney (PoA)
One has to be very sure while granting the Power of Attorney (PoA) as it can be misused by the person being granted these powers as on the basis of the same one may undertake malafide deeds and he or she will have the legal protection as he will be doing the same on your behalf.
Letter of Authority (LoA)
A Letter of Authority (LoA) is used more for administrative convenience. So, use is limited to smaller tasks like filing or collecting documents or cheque book(s) on another’s behalf. The LoA donor (person who appoints another to act on his behalf) has to clearly mention what has to be done by the holder (person who is handed over the LoA) and how he would perform the work. The task is usually carried out under the supervision of the donor.
Verdict
Letter of Authority (LOA) is more secured when compared to the powers granted in Power of Attorney (PoA) and if one has to choose between the both we would like to go with Letter of Authority (LOA).
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