An Authorization Letter for Collecting Money is commonly used in India when an individual or organization needs to delegate the authority to collect funds to another party. This document is essential in situations where the original recipient of funds cannot personally collect money due to various reasons such as physical absence, illness, or business commitments. The letter, governed by Indian contract law, particularly the Indian Contract Act, 1872, must include specific details about both parties, the authorized amount, purpose, and validity period. It serves as a legal safeguard for all parties involved, including the paying entity, by providing clear documentation of the authorization. The document is widely used across various sectors, from personal transactions to business operations, and may require stamp duty depending on the state and amount involved.
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1. Date and Place: Current date and location where the letter is being written
2. Sender Details: Full name, address, and contact information of the person authorizing the money collection
3. Recipient Details: Full name, address, and contact information of the person being authorized to collect the money
4. Subject Line: Clear indication that this is an authorization letter for collecting money
5. Authorization Statement: Clear and unambiguous statement authorizing the recipient to collect money on behalf of the sender
6. Transaction Details: Specific amount to be collected, source of money, and any reference numbers or relevant details
7. Time Period: Validity period of the authorization
8. Authentication: Signature of the authorizing person with date
9. Witness Details: Name and signature of witnesses (typically two) to verify the authorization
1. Identity Proof Reference: Reference to attached identity documents of both parties - recommended when dealing with significant amounts or formal institutions
2. Terms and Conditions: Specific conditions or limitations on the authorization - needed when there are special requirements or restrictions
3. Purpose Statement: Explanation of why the money is being collected - useful when dealing with institutions or for record-keeping
4. Indemnity Clause: Protection clause for the authorized person - recommended when dealing with large sums or complex situations
5. Emergency Contact: Alternative contact information - useful for high-value transactions or longer authorization periods
1. Identity Documents: Copies of government-issued ID proofs of both parties
2. Original Payment Details: Documents showing the original payment due, such as invoices or agreements
3. Proof of Relationship: Documents establishing the relationship between authorizer and authorized person, if relevant
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