Buying Immovable Property, Legal Checklist

Legal Aspects in buying immovable property in India:

By Sandigdha Mishra, Adv.

advocate.sandigdhamishra@gmail.com

Buying a property, is not only buying a dream home but also your investment for life.  Hence purchasing your first home can be an extremely intimidating process. You are confronted by many terms that you may not understand, and you may not realize how many necessary steps there are in the process. To make matters worse, everyone else, including the seller, banker, and real estate agent, may seem like they know exactly what is going on, so you may not feel comfortable asking questions.

Even under Government Housing Schemes in India, unless all documents to be verified before buying a plot are presented for the land or plot you are allotted, no construction takes place. Documents needed to be submitted while the house or apartment is under construction.

So be prepared to face the challenges which are involved in the property purchase with the help of this article that provides a final check for the required essential documents:

In India, the laws relating to the properties are generally dealt with by the Transfer of Property Act, and the Real Estate Regulation and Development (RERA) Act, making it extremely vital for you to go through the documents to be verified before buying a plot from a builder.

Under the RERA Act, the properties need to be registered with the RERA authorities in the particular state. RERA also makes it necessary for the builders to get their projects registered and gives a quick view on your behalf on all the major documents to check before buying a flat from a builder. 

So, before you venture out to buy any property anywhere in India, it’s important that you consult a good property lawyer or a real estate lawyer near you. He/she can help you with documentation and application procedures efficiently. 

Below you can find the list of documents required before buying ownership flat or of any other property. Whether you are buying it from a builder or from some Gram Panchayat of a State, it’s advised that you consult someone for a better understanding of the following requisites:

Title Deed: 

The Title Deed is one of the most important documents to be verified before buying a house or anything else that helps in signifying the actual ownership of it. It also states the rights and obligations of the owner along with the rights of a mortgage, if at any time required by the owner.

Construction Clearance Certificate or Commencement Certificate:

This document is required when you are buying any ongoing construction property from a builder. Commencement Certificate is one of the important documents to check before buying a flat from a builder or land, house, etc. It states that the construction has commenced only after getting the approval, license and permission from the local authorities. 

Building Approval Plan or Approved Layout Plan:

Approval Plan is necessary as it states that a building in which you are planning to purchase a place of residence should be approved of by the local authorities and there are no issues related to it. 

No Objection Certificate or NOC:

The certificate of No Objection is one of the most crucial documents to check before buying a flat from a builder which is issued by the concerned local authorities stating that there are no discrepancies in the present plan and that it can be duly executed. It works as an evidence to show that the project or the building is approved by the authorities and no objections are raised with regards to the construction of it. 

Land Use Certificate:

A land use certificate is mandatory, as it states the purpose for which the land is to be used. On the basis of the use of land, the land is also divided into three categories. 

For example, in India there are a few areas where there are regulations for documents to check before buying agricultural land. The purpose of the land should be clearly mentioned in the Land Use Certificate, which specifies the type of land and the activities that could take place on that particular land. The very same way you cannot use commercial land for residential purpose  you cannot carry out any commercial activity on agricultural land.

Encumbrance Certificate:

Encumbrance Certificate helps in ensuring that the property is free from any kind of dispute over its title and there is no loan or mortgage against it which the buyer is intending to buy. 

Completion Certificate:

After completion of the project, one should make sure that documents to be verified before buying a house are complete. 

Occupancy and Possession Certificate:

This certificate is issued by the local authorities. It is issued only after the completion of construction of the project. This ensures that the building is fit for occupation purpose and can be possessed by people who are purchasing the property.

For a better clarification of the necessary documents, let’s have a look at the following official papers to be verified before buying a flat, house, land, plot, etc:

Sale Deed:

Sale deed includes all the necessary details about the buyer as well as a seller of the real-estate possession. Only when sale deed is executed can we say the sale of a possession become final.

Mother Deed:

Also known as the parent document of a real estate, the Mother Deed of helps in knowing the actual origin of the property and act as an essential document in case of resale of property.

Conversion Certificate:

The Conversion Certificate is issued from the competent revenue authority on the request of the revenue authority to convert the land for non-agricultural purpose. 

Khata Certificate:

The term Khata means account. In case you are transferring property from one person to another, Khata Certificate is necessary for such transactions.

Power of Attorney:

Through the Power of Attorney, a person appoints another person to act on their behalf. He legally authorizes the appointed person by way of either General Power of Attorney or the Special Power of Attorney. 

Tax Paid Receipts:

Apart from all necessary papers, receipts of the tax paid by the owner of the property play a vital role. The taxes that are levied on it are property tax, house tax and other taxes that are levied by the Municipality.

Essential Aspects:

The documents include- Sale Deed, Mother Deed, Building approval plan, Commencement Certificate (For under construction property), Conversion Certificate (Agricultural to Non-agricultural land), Khata Certificate and Khata Extract, Encumbrance Certificate (EC), Betterment charges receipt, Power of Attorney(POA), Latest tax paid receipt, Completion Certificate (for a constructed property), Occupancy Certificate (for a constructed property).

Check for the title papers to see if it has a clear title, without any dispute. Ask for bank's approval Tally the approved plan with actual site Look out for property tax slips Encumbrance certificate Check if the project has a registered society

It takes about 6 months to buy a house. However this varies from property to property. 

The documents we require for housing loan are:- Agreement to Sell (ATS,) Chain of Title or Sale Deed, NOC from the society or other concerned bodies, Share Certificates in case of societies Title Report Occupancy/Completion Certificate(OC), Encumbrance Certificate(EC)

Please note a builder cannot allot a flat without obtaining an OC. The Law clearly states that no person shall occupy or allow any other person to occupy a building or part thereof without obtaining an OC.

Registration of Immovable Property In Haryana:-

As per Section 17 of the Registration Act, 1908, all transactions that involve the sale of an immovable property for a value exceeding Rs 100, should be registered. This effectively means that all the transactions of sale of immovable property have to be registered, as no immovable property can be purchased for merely Rs 100. Additionally, all transactions of gift of an immovable property, as well as lease for a period exceeding 12 months, are also mandatorily required to be registered.

The property documents that need to be registered, should be submitted to the office of the Sub-Registrar of Assurances within whose jurisdiction the property, which is the subject matter of transfer, is situated. The authorised signatories for the seller and the purchaser, have to be present along with two witnesses, for registration of the documents.

The signatories should carry their proof of identity. The documents that are accepted for this purpose, include Aadhaar Card, PAN Card, or any other proof of identity issued by a government authority. The signatories also have to furnish the power of authority, if they are representing someone else.  In case a company is party to the agreement, the person representing the company has to carry adequate documents, like power of attorney/letter of authority, along with a copy of the resolution of the company’s board, authorising him to carry out the registration.

You need to present the property card to the sub-registrar, along with the original documents and proof of payment of stamp duty. Before registering the documents, the sub-registrar will verify whether adequate stamp duty has been paid for the property, as per the stamp duty ready reckoner. In case there is any deficit in the stamp duty, the registrar will refuse to register the documents.

Note here that witnesses are quite important in the overall process. The two witnesses that you intend to present during the registration, will also have to establish their identity in front of the sub-registrar. For this purpose, they should also carry their ID proofs and their address proofs. Additionally, their biometric identity will also be scanned during the process.

Time limit, fees for property registration

Documents that have to be mandatorily registered, should be presented within four months from the date of their execution, along with the requisite fee. In case the time limit has expired, you can make an application to the sub-registrar for condonation of the delay, within the next four months and the registrar may agree to register such documents, on payment of a fine that may be up to ten times the original registration fee. 

Earlier, the documents that were presented for registration, would be returned to you after a period of six months. However, with computerization of the offices of the sub-registrar, the documents (bearing the registration number and proof that the documents have been registered by the registrar) are scanned and returned to you on the same day.

Online property registration

In most Indian states, the buyer can complete a large part of the property registration process online. Depending on the state where you live, you could avail of the online services, to part-finish the registration process. However, for the final step, you would have to appear at the sub-registrar’s office, along with the seller and two witnesses, to complete the transaction. Once the documents are registered, you will have to revisit this office, to collect your registered property documents.

:Thank You:

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