Checking all related documents
is very vital for buying any property, be it a plot, apartment or an
independent house. I provide here-under a list of important property documents
we need to check before buying any property.
- Rules governing property vary from State to State and there are no
uniform laws.
- I have tried to list down some laws or documents, which are more
or less common, with slight variations, to most of states.
- Time required & charges for each vary from state to state.
- Time taken for each also depends factors like how strong our follow
up is and efficiency of concerned authority.
Sale Deed
Sale Deed is the core
legal document that acts as proof of sale and transfer of ownership of the
property from the seller to the buyer. A Sale Deed has to be compulsorily registered.
It is important that
before the Sale Deed, one should execute the Agreement To Sell and check
compliance of various terms and conditions as agreed upon between the buyer and
the seller. Before executing the Sale Deed, the buyer should check whether the
property has a clear title. He/she should also confirm if the property is
subject to any encumbrance charges.
A seller, subject to the
terms of agreement, should settle all the statutory payments such as property
tax, cess, water charges, society charges, electricity charges, maintenance
charges etc. till the date of execution of Sale Deed.
Mother Deed
Mother Deed, also known
as the parent document, is an important legal document that traces the
origin/antecedent ownership of the property from the start, if the property had
more than one owner. In case original Mother Deed is missing, certified copies
of same should be obtained from the registering authorities. Mother Deed
includes the change in ownership of the property, be it through sale,
partition, gift or inheritance.
It is important that the
Mother Deed records the references to previous ownership in a sequence and
should be continuous and unbroken. In case of a missing sequence, one should
refer to the records from the registering offices or revenue records. The
sequence should be complete till the current owner.
Approved Building Plan
A building plan is
sanctioned by the concerned Development Authority. Authorities sanction a
building plan based on the zonal classification, road width, floor area ratio
(FAR) and plot depth.
A set of documents is
required to be submitted by the owner to get building plan approved. The
documents vary from state to state, and a list of documents required can be had
from concerned authority’s website or from their local office.
It is mandatory that the
building owner hires a registered architect who will draw a plan meeting the
applicable bye laws. One can get a building plan approved within 4-5 working
days if all the requirements are met.
Above a certain height and depending upon distance from nearest
airport approval of concerned Airport Authority is also must without which the
construction of the building is illegal.
Commencement Certificate
(applicable For under construction property)
A Commencement
Certificate is a legal document issued by the local authorities after the
inspection of the site. This document states that project meets the given
criteria. Failing to acquire a Commencement Certificate can result in the
construction being considered illegal, levying of penalties and even an
eviction notice.
Conversion/ Change of
Land Use(CLU) Certificate
With majority of land in
India being agricultural in nature, a Conversion Certificate is mandatory from
the local concerned authority this document is called Change Of Land Use (CLU)
Certificate. Further, the competent revenue authority requests the Department
of Town and Country Planning to issue an NOC for the conversion of land for
residential purpose. There are a certain set of documents to be submitted by
the owner to acquire a Conversion Certificate.
6. Khata Certificate and
Khata Extract
Khata is derived from
the word ‘account’. It is account of a person owning a property. It typically
consists of Khata Certificate and Khata Extract. A Khata Certificate is
mandatorily required for the registration of a new property and transfer of an
old property. Khata Extract is nothing but obtaining the property details from
the registrar. Khatas are widely
referred to as “A Khata” & “B Khata”.
“A Khata” has properties
listed under Municipal jurisdiction with legal construction and “B Khata” has
properties under local jurisdiction with violated constructions. One should
avoid buying a “B Khata” property as it will be deemed as an illegal
construction. Nevertheless “B Khata” may be converted to “A Khata” under
certain schemes by paying penalty to the Government.
Encumbrance Certificate
(EC)
Encumbrance means
charges on the ownership & liabilities on a property that is held as a security
for some debt. An EC consists of all the registered transactions done on the
property during the period for which the EC is sought. Simply put, it is a
certificate sought for a particular period evidencing the property
purchase/sale and any other transaction or mortgage.
One should submit a copy
of the Sale Deed to obtain an EC. A person applying for an EC should fill in
the Form 22, affix a non-judicial stamp and submit it to the jurisdictional
sub-registrar’s office. Complete residential address, property survey number,
property location, the sought period, property description, its measurements
and boundaries should be mentioned in the Form. A nominal fee will be charged
which will depend on the period for which EC sought on per year basis. The time
taken to obtain an EC will be between 3-7 working days or more depending on the
length of period for which EC sought.
Betterment charges
receipt:
Betterment charges, also
known as improvement fees/development charges, are to be paid to the Municipal
Authority before a Khata can be issued. Currently the developers are entitled
to pay a fixed amount as betterment charges to the municipal body. A receipt of
the same should be obtained at the time of property buying.
Registration
Buyer must get the
property registered in his/her name by paying the Stamp Duty as specified by
local government. This Stamp Duty has to be borne by Buyer. After paying this
Stamp Duty, the property stands transferred in Buyer’s name and seller has no
rights whatsoever on that property.
Latest receipts for
payment of various bills & statutory charges
Receipts for property
tax ensure that taxes for the property are paid up-to-date. For properties
falling under the Municipal Committee jurisdiction, it is mandatory for
property taxes to be paid up to date to get a Khata issued.
It is therefore
important for the buyer to make inquiries with the government/municipal
authorities to ensure that all the dues are cleared by the seller. The buyer
should ask the seller for the latest original tax receipts and bills and check
the details like owner’s name, the tax payer’s name, and the date of payment on
the receipt. If the owner does not have the tax receipts, the buyer can contact
the municipal body details of property to confirm the payment of taxes.
Buyer should also ensure
that other bills such as the water, electricity maintenance etc. are paid
up-to-date.
Completion Certificate
A Completion Certificate
is issued by the municipal authorities denoting that the building is in
compliance with their rules in terms of height, distance from the road and is
constructed as per the approved plans etc. This document is important at the
time of purchasing a property and getting it registered.
Occupancy Certificate
When the Real Estate
Developer applies for this Certificate, an inspection is carried out by the
authorities to ensure that the construction meets all the specified norms. This
certificate is obtained after the completion of the construction. It is
important at the time of buying a property, seeking a home loan, for the
transfer of Khata etc. Basically, it certifies that the project is ready for
occupancy.
Environment Clearance
Environment clearance is
another important document which is required before the start of construction.
A set of documents including Layout Plans of the project are required to get this
clearance.
It depends on the area
of the project that whether the approval will be given by state Environment
ministry or it will go to center. Currently if the project area is less than
50000 Sq. Meter than it comes under the preview of State government and higher
than that it goes to center.
Water & Pollution
Control Board Clearance
These are two more
clearances which are required to be taken before starting the construction at
sight. Here the same set of documents is given as in case of environment
clearance.
Group Housing Approval
By Ministry of Housing
State Ministry of
Housing under the instruction of Governor Issues this approval & is
generally signed by Under Secretary.
Site Survey Plan
Survey of site by
Professionally Accredited agency is done. The purpose of this survey in
addition to other things like presence of High Tension wires within a distance
of 300 Meters From site, any government water or sewerage line going beneath
the project site and a whole of other information. This report is submitted to
Development Authority.
Lease Deed
In certain states
including Rajasthan , Parts of U.P. , Parts of M.P. land is not registered in
the name of buyer but he is issued Pattas, which is a 99 Years Lease in favor
of owner. These governments are in the process of regularizing land documents
and once that is complete these pattas will be converted into registries. But
otherwise these Pattas are bankable documents.
Registration of Pattas
These pattas thus issued
are duly registered in the office of Registrar by paying the applicable Stamp
Duty.
