Tiltle clearance
Rupam Ghosh
(Querist) 24 October 2011
This query is : Resolved
Hi, What are documents which buyer should verify before buying a flat developed on Govt plot of land in order to get the clear title on the said flat.
prabhakar singh
(Expert) 24 October 2011
please look into the following to take precautions in buying any property and act accordingly.....
PRECAUTIIONS TO BE TAKEN WHILE PURCHASING
PROPERTY/LAND
Purchasing a property/land requires utmost care. One has to examine and find out the title of
the seller or nature of his right. A seller can sell only what he possesses. Therefore if a seller
has proper and valid title, on purchase you will get valid title. If the seller's title is defective,
you will get only defective title. The simple reasoning is that he can sell what he has, and
nothing more.
Some of the important aspects to be borne in mind while purchasing a land may be classified
under different heads as follows:
1. First and foremost ask who is the seller. Get the full name and address of the seller.
2. Find out what is the nature of his right. The seller may be having absolute ownership
right, or a conditional or limited right.
3. So far as the types of rights in the land, it can be classified mainly as follows:
• Free hold or absolute ownership land known as Warg right
• Mulgeni right (right of permanent lease),
• Tenancy right,
• Lands granted by government, under Land Grant Rules, Land Revenue Act,
Grant of Flouse sites.
• Lands granted under Land Reforms Act, etc
4. It is always advisable to deal with a Freehold right or absolute ownership right, which is
also called as Warg right.
5. After getting the particulars as to who is the seller, what is his right, then find out the
source of his right or title.
a) The title of the seller may be by purchase, by inheritance, by partition, by gift, by
settlement or by grant.
b) To find out the source of title there must be some document like.
Right of purchase ---------- Sale Deed
Inheritance ----------------- Entries in Revenue records, and predecessor's title
Partition --------------- Deed of partition
Gift ---------------------- Gift Deed
Settlement------------------- Deed of settlement
Grant ------------------------ Grant order
Mulgeni --------------------- Deed of Mulgeni or permanent lease
c) If the right is by purchase ask for the original sale deed. See when the seller had
purchased the land and from whom he had purchased. Verify the previous records.
Verify, the title for thirty years.d) If it is by inheritance, ask the particulars as to from whom he has inherited.
What was the right of his predecessor? Again i t m a y b e a s a l e d e e d o r g i f t , o r
inheritence. Verify the previous title Get the details as to how his predecessor
acquired the title, and whether he is the only person who has inherited. If there
are other persons who have jointly inherited, then you have to find out, whether
there was any partition. Whether there are any minors who have inherited the
property. If there is a minor, the minor's property can not be purchased
without obtaining permission of the Court.
e) If it is by partition there must be a deed of partition.
f) See whether there are any conditions or restrictions in the deed of partition. Find
out whether there are any conditions, like pre-emption, water rights, rights of
way, payment of maintenance etc.
g) Likewise if it is gift deed, or settlement deed, or grant, get the original
Gift deed, settlement deed, or grant order as the case may be. Read the
document and see whether there are any conditions, like reservation of
life interest, restrictions for alienation, payment of maintenance, pre
emption etc. Some times there may be reservation of life interest, or
what was gifted may be only right of enjoyment
h) Rights acquired under various types of Grant orders again are subject to several
conditions regarding alienation and enjoyment. This has to be verified. If the
grant is in favour of a person belonging to Scheduled Caste or Scheduled Tribe
community, generally there will be a condition prohibiting alienation. Such
lands cannot be purchased
i) If it is a Mulgeni ask for the deed of mulgeni, again see whether there are any
conditions. Mulgeni or right of permanent lease is again a conditional right. In
such cases there are two parties or persons having the right in the Jand. One is
the owner and another is the permanent lessee. In other words, one is the
Mulgar/owner and the other one is Mulgenidar/ tenant. The possessory right or
right of enjoyment will be, with the Mulgenidar/tenant.,The owner/Mulgar will
have the right of ownership with right to collect the stipulated rent. The deed of
Mulgeni or deed of permanent lease will contain the restrictions regarding
alienation, payment of rent, and the other rights of the lessee etc. All these have
to be verified. Because the owner/mulgar will generally have a right to
challenge or question the alienation/transfer and the very right of mulgeni can
be cancelled or terminated. It is always advisaWe to find out as to that is the
Mulgar, or owner, and purchase his rights also.
j) If there are any conditions in the documents, examine the conditions, and if the
conditions restrict or prohibit the transfer or alienation, do not proceed.6. Find out the extent of the property and see whether it tallies with the
one mentioned in the documents. Verify the survey number, location and
boundaries and get the land measured through a competent surveyor.
7. Find out whether there is an approach road.
8. Examine the sketch or plan of the property.
9. Get the record of rights (RTC) of the land and confirm that the name of the seller
is shown as owner in possession of the property. You can get the latest
computerized RTC from the Taluk Office. The record of rights will disclose the
name of the owner, name of the person in possession, nature of right, nature of
land, and also encumbrances if any.
10. Identification of the lands will be always by Survey Numbers. Record of rights/
khata will give an indication as what is the right of the holder. Confirm the entries
in the record of rights/khata with some other registered documents / or previous
documents. This is because the Record of rights or khata by itself is not a
document of title
11. For converted lands there will be what is called as Khata. Apply and get Khata
extract from the Mangalore City Corporation.
a. The zone where the property is situated. Apply to the Mangalore
Urban Development Authority with survey number and sketch
for a zonal certificate. If the property is in residential zone,
construction of house will be permitted. If the property in
commercial zone, industrial zone, park zone, etc, construction of
house will not be permitted.
b. In City/ urban areas the user of the lands are regulated by zonal
classifications. The Urban Development Authority is the
Department, which deals in the matters relating to zonal
classifications. We have to see in which zone the land is located.
For construction of house the property must be in residential
zone.
12. Whether the property is converted? For using the land for building
houses or other buildings, the land has to be converted from
agricultural use to non-agricultural use. By filing an application to the
Tahsildar, with sketch and other particulars as prescribed, and bypaying the prescribed fee you will get an endorsement/order that the
land is converted. This is necessary because all lands assessed for land
revenue are considered as agricultural lands. The conversion is done
under the provisions of Kar.Land Revenue Act. The Tahsildar, and in
some cases the Deputy commissioner are the authorities prescribed
under the Land Revenue Act for getting the land converted.
13. National High way and State High way: As per the National High Way
and State High way Rules construction of buildings will not be permitted within arange of 60 meters from the center of the National High Way. If the land is by the
side of National High Way, this aspect has to be verified.
14. Coastal Regulation Zone: Construction of buildings are not permitted
within a range of 200 meters from the high-tide zone in case the
property is situated by the side of river and 500 meters in case the
property situated by the side of sea.
15. We have to find and out and see whether there are any encumbrances, charges, or
mortgages on the property. Verify Encumbrance certificate for at least 13 or 15
years up-to-date. If there are any charges/mortages/ or other encumbrances noted
in the Encumbrance certificate do not proceed till the same are cleared or clarified.
How to find out this?
a. Apply and get an encumbrance certificate at least for 13 or 15
years, from the office of the Sub-Registrar where the immovable
property is situated. Give the particulars of the property like
Survey Number, extent of land, name of the village, name of
ward, boundaries, etc. and specify the period for which you
require the encumbrance certificate.
b. The encumbrance certificate will show the details of registered
documents relating to the property, Like sale deeds, mortgage
deeds, etc.
c. If there are no such registered records relating to the property
the encumbrance certificate will be a Nil Encumbrance
certificate.
d. Mortgages or charges can be created by registered documents, or
by depositing the original title deeds. If it is by registered
documents, like deed of mortgage, it will be reflected in the
encumbrance certificate. If it is by deposit of title deeds, the
Encumbrance certificate will not disclose it. Therefore you have
to ask for the originals title deeds for verification. If the original
title deeds are with the owner it means that he has not deposited
it with any body. Sometimes, the originals might have been lost
by misplacement, fire, or by some other means. If that is the
situation then one has to proceed only on the basis of trust. We
can ask for an affidavit, a sworn statement of the owner to the
effect that the original title deeds are really lost and that he has
not created any charge, or deposited it with anybody. A paper
publication can also be given.
16. If the properly which you are going to purchase is a land with building, you have
to verify the building licence, completion certificate and latest tax paid receipt
17. Khata of the building and land has to be verified and it must show
the name of the owner.18. Apartments: If the property which you are going to purchase is an apartment you
have examine and verify:
a. The title to the land on which the apartment building is
constructed. For tracing and confirming the title of the land on
which the Apartment building is built, the same points narrated
above have to be followed.
b. The land and the building must have been submitted to the
provisions of Kar. Apartment Ownership Act 1972, by a
registered document called the Deed of Declaration. Read the
Deed of declaration and it will give you a clear picture as to
what are the common rights, facilities, how it has to be enjoyed,
how it has to be maintained. As a whole the deed of declaration
will contain the various provisions regarding the mode of
enjoyment of the apartments, common areas, and facilities.
c. The percentage of right in the land which you are going to get
has to be verified
d. Whether the Association of the Owners has been formed?
e. Get a no due certificate from the Association of Owners
regarding maintenance or other charges so far as it relates to the
apartment, which you are purchasing.
f. The building license, plans, completion certificate latest tax paid
receipt have to be verified.
g. All documents relating to land as explained above have to be
verified.
h. The original of the sale deed relating to the apartment, which you are
purchasing, has to be obtained.
19. Some points regarding Minors right, and rights of inheritance:
a. If right of minor is involved in any property, it is not advisable to purchase
such land. The minor can always question the sale by the father or mother as
guardian within three years of his/her attaining majority. Getting Court
permission for sale of minor's property, or right in the property will protect
your rights to some extent.
ii) Regarding rights of inheritance, among Hindus all children irrespective of
sex, they get right by birth in ancestral property as per the latest central
amendment to the Hindu Succession Act. The rights of children are equal.
So far as Indian Succession Act is concerned, which is applicable to
Christians, when a male dies intestate, (i.e. without a Will or other
documents) his wife will get one-third right and the remaining two-third will
gojll the children equally. For Mohammedans, when a male dies the wife and
children will get the rights. However if there are no male issues and only
daughters, as per Mohammedan Law, some of the near relatives of the
deceased father will also get a share.iii) If the property is self-acquired property, the question of children inheriting
any right by birth does not arise. However when a male Hindu dies leaving
behind his self-acquired property, without leaving behind any Will or other
documents, the succession to the property will be as per the Hindu Succession
Act. If the property is ancestral property, or a property inherited by his father,
the succession for such property shall be as per the Hindu Succession Act and
the same can not be regulated by Will. However this concept of ancestral or
family property etc are not there under Indian Succession Act. Thus the
property inherited by a Christian will be as good as his/her self-acquired
property.
20. Sale by General Power of attorney holder. In many cases the actual
owner does not come forward for executing the sale deed and the GPA
holder represents the owner. In such cases first of all we have to
verify the genuineness of the GPA. The original GPA must be verified
and the GPA holder must have the custody of the original GPA. The
following points may be borne in mind while examining the GPA:
a) The GPA is still in force. If it is an old GPA ask for a confirmation.
b) The GPA must contain the following powers and particulars:--Power of sale,
power to sign and execute the sale deed, receive the consideration, appear
before the Sub-Registrar, present the document for registration, admit
execution and receipt of consideration, deliver possession of the property and
description of the property, full name and address of the person giving the
power and the person to whom it is given. If all these powers are there the
GPA holder can execute the sale deed.
c) The GPA must be drawn on stamp paper of the required value. It must be
attested by a Notary, Magistrate, Sub-Registrar or embassy.
21. As the sale transactions cannot be done then and there, and since it
requires some reasonable time for both the seller and purchaser, many
a times, the parties enter into agreement for sale pending registration of
the actual sale deed. Before entering into agreement for purchase or
sale, all the points narrated above have to be verified. The purchaser
must retain the original agreement. Copies of the title deeds have to be
obtained. The agreement has to be drawn and executed on stamp paper of
required value. The agreement for sale must contain at least the
following particulars:
a) Full name and address of the Seller and Purchaser.
b) A brief history of the title of the seller, with reference to his title deed.
c) An undertaking by the seller to sell |he land to thed) The total price of the property agreed between the parties.
e) The amount of advance paid, mode of payment, acknowledgement of receipt of the advance
by the seller, the amount of balance price to be paid, the time for payment of the balance
price.
f) Time for execution and registration of the sale deed.
g) An undertaking to deliver vacant possession of the property
h) An undertaking to hand over all title deeds
i) A clear description of the property
j
) Date and time of the agreement.
k) A default clause stipulating penalty or damages for breach of agreement.
Availing loans from Banks:
Generally banks insist scrutiny of title for 30 years. The original title deeds
must be produced. The chain of title from the latest to thirty years back has to be established
by clear documents. In most of the cases, originals of all the previous documents is not
possible. There may be cases where one big property was divided into several sites, in which
case all the purchasers will not get the original of the parent document. However original of
the latest document must be produced. In some cases even the original of the last document
may not be available, on account of loss of document by fire, misplacing, or for other
reasons. In such cases, you will have to swear to an affidavit stating that the original is lost,
and not available, and that you have not deposited the document with anybody, nor created
any charge. A paper -publication can also be given. However the creditor /purchaser may or
may not accept and agree. In such cases the property can be mortgaged only by registered
mortgage.
In addition to the above, Latest Khata, or RTC, Conversion order,
Encumbrance Certificate for 15 years, latest House tax paid receipt if there is a building, are
the further requirements. If all these documents are available, by depositing originals of these
documents with the bank, as security for the loan, you can create valid mortgage/charge in
favour of the Bank. This type of mortgage is called mortgage by deposit of title deeds. This
type of mortgage will not be reflected in the Encumbrance certificate. But such charges can
be noted in the Record of rights, or khata if the bank gets the entry made by app
Sankaranarayanan
(Expert) 24 October 2011
No more details you need further. Mr prabhakr singh given almost all contants of chapter from book
Rupam Ghosh
(Querist) 25 October 2011
Thank you Singh Sir, I know on a cursorily look it explains everything I was looking for, however the contents are little voluminous which I will go through. :)
