Purchase of Land in a Village: Legal Checklist & Procedure

Owning a property is a very important event in one’s life. But, one needs to be careful while buying a property to avoid falling into legal hassles. When we talk of buying Land & that too in a village, a number of things need to be checked to confirm that the land has a clear and marketable title. The legal status of the land is one of the first issues that should be addressed before closing deal.

So given here under is the list of documents we need to check & procedures:

         Title deeds

The first step is to see the title deed of the land, which you are going to buy. Confirm whether the land is in the name of the seller and full right to sell it lies with him. It is better to get the original deed checked by a lawyer. This is to check details like whether the seller has allowed any entry/access to others through this land and whether any other fact has been suppressed/left undisclosed by the owner of the land.

Along with the title deed, you can also demand to see the previous deeds of the land available with the seller. In some cases, more than one person may own the said land. If it is so then get release certificate from the other people involved.

Encumbrance Certificate

Before buying land, it is important to confirm that the land does not have any dues. Obtain a certificate called encumbrance from the sub registrar office confirming if the said land has any legal dues and/or complaints pending. Normally an encumbrance certificate has record for the past thirteen years, but you could demand the 30 years encumbrance certificate.

Pledged land

Some people may have taken loan from the bank by pledging their land. Ensure that the seller has paid back all the amounts due, before you make him final payment. Ask for a release certificate/NOC from the bank, which say that all the debts over the land have been cleared.

Measuring the land

It is advisable to get the land measured & demarcated before making final payment & getting land registered in your name. Take the help of a approved surveyor or Patwari (land record clerk in a tehsil or sub-Division) to ensure that the measurements of the plot and its borders are accurate. You could also take the survey sketch of the land from the survey department and compare for accuracy.

Purchasing land from NRI landowners

An NRI can also sell his land in India by giving a Power of Attorney to a third person authorizing him the right to sell the land on his behalf. In such cases, the power of attorney should be witnessed and duly signed by an officer in the Indian embassy in his province.

Power Of Attorney

Power of Attorney is the power given to an agent by the principal to execute several acts and deeds for and on behalf of the principal. Stamp duty payable to get Power Of Attorney registered depends on the nature of power given.

When ‘power’ is given for multiple acts in multiple transactions it is called General Power of Attorney. It is always advisable to have a registered GPA with the person signing sale documents while registering an immovable property in order to give get clear/undisputed title of the property. When ‘power’ is given in respect of a particular act pertaining to one transaction it is called Special Power of Attorney.

Agreement

Once all the matters, financial & others are settled between the parties, it is better to give an advance and write an Agreement To Sell. This ensures that the owner does not change his word regarding the cost as well as make a sale to someone else who offers more money.

The agreement should be written in Rs.50 stamp paper. The agreement should state the actual cost, the advance amount, the time within which complete payment should be made and how to proceed in case of any default from either parties, to cover the loss.

The agreement should preferably be prepared by a lawyer and signed by both the parties and two witnesses. After signing the said agreement if one of the parties makes a default, the other party can take legal action against him.

Stamp Duty

It is tax, like any other tax and must be paid at the time of making final payment & getting Sale Deed registered. Only a Stamp Duty paid document is considered a legal document.

Stamp duty is a State subject and hence rate would vary from state to state. When an agreement is to be stamped, it needs to be unsigned and undated one may execute the agreement only after the Stamp Office affixes stamps on the agreement.

   Registration

Registration is the process of recording a document in the office or registrar & transferring the title of immovable property to buyer. It acts as proof that a transaction has taken place.

A draft should be prepared before actually writing the document on Stamp Paper. Registration is done after the parties execute the document. The agreement should be registered with the Sub-Registrar of Assurance under the provisions of the Indian Registration Act, 1908 within four months from the date of execution of the document.

Make sure all the details mentioned are accurate. Original Title Deed, Previous deeds should be handed over to buyer. Two witnesses are needed for registering the property. The expenses involved during registration include Stamp Duty, registration fees, Document writers/ lawyer’s fees etc. Make sure that the deed is registered within the time limit mentioned in the agreement. Stamp duty should be paid prior to the Registration.

Changing the title in Village office

The whole legal procedure of buying the property will be complete only if the new owners name is added in the village office records. An application should be made along with the copy of the registered deed to the Village office to get this done.

Purchase of property is a lifetime investment. A lot of care is needed from the beginning- right from site seeing till the registration of the land. Ensure that all documents of title are scrutinized for marketability with due care by an experienced advocate.