UNREGISTERED DEVELOPMENT RIGHT AND CONSTRUCTION SALE AGREEMENT
Querist :
Anonymous
(Querist) 20 June 2011
This query is : Resolved
Mr XYZ is fuly seized and possessed of land, in a place [D] in Thane district, Maharashtra, obtained approval of a group Housing scheme from CIDCO, Town planning authority for the region.
Necessary CC was also issued. NA permission is also obtained from concerned
Authorities..
Thereafter Mr XYZ entered into agreement granting development rights in respect Of specified FSI on concerned land to M/s ABC Partnership FIRM having two partners.. Builder and to construct the flat and sell in the name of the said partnership. Flats have been constructed and put on sale and I intend to purchase one flat in the said proposed Housing society from reseller who has purchased from the said builder -- partnership firm M/s A B C---.2 years ago for which he has a registered sale deed signed by one of the partner of M/s ABC[NOT BY BOTH PARTNERS].
It is not known whether the said partnership firm is registered or not.
However, none of these agreements between the Land owner and builder were registered and my advocate says the owner of the flat has to fall back on irrevocable POA and other documents executed by owner of Land permitting development.
Despite The above remarks in the legal opinion, our advocate says the title of the purchaser of the Flat in the said society is clear, good, beyond reasonable doubt, marketable and unencumbered in view of search undertaken and that the Title Of the builders for construction and sale is based on unregistered agreement and POA.
Is it safe to buy such a flat in housing society which is under formation especially when only one partner has executed sale deed???
R.Ramachandran
(Expert) 21 June 2011
First and foremost, the partnership firm only had a development right. Once it develops the land and constructs the building, the built up portion belongs to the partnership but the proportionate undivided land underneath the building still belongs to the original land owner. Therefore, whenever the flat is sold, while the built up portion will be sold by the partnership firm (single partner signing the document is OK), the original land owner also needs to execute a sale agreement in respect of the proportinate undivided land underneath the building. Only then the Flat owner gets a complete title to the flat, otherwise not.
