Some countries have simplified the process of buying property, including the validation of ownership documents by the government.In India the process of identifying the right property is fraught with risks, legal and other regulatory hurdles. Buyers are often at the mercy of builders and brokers and enthused to make decisions, by the promise of tempting offers. However tempting and profitable the prospect may appear so it is very important for a buyer to exercise the whole situation and obtain appropriate legal advice, to securetheir interest before buying a property. Due diligence and awareness of buyers rights can definitely protect you against dodgy practices by developers or brokers/sellers. In an industry that still lacks transparency it is important to inspectall documents before buying a property.It is therefore important that the whole procedure be dealt with systematically to reduce the hassles.Here is the list of the legal documents that should check when buying any property:
Sale Deed:
A Sale Deed is one of the most important legal documents which act as a proof of sale and transfer of ownership of the property from seller to buyer. A Sale Deed has to be necessarily registered before the office of the Sub Registrar. Before executing any document, the buyer should check whether the property has a clear title or not.A seller should resolve all the statutory payments such as property tax, water charges, society charges, electricity charges, maintenance charges etc.
Verify the personal detail of the seller
The agreement must mention the complete detail of the seller. This includes father’s name, address, PAN number information etc. It must also provide exact details of the property location and municipal, administrative division (Tehsil) or collector’s land record number. The agreement must be witnessed by two people.
Construction approvals
Before buying of apartment or land the buyer should also inspect the layout plan/ building plan sanctioned by the local municipal authorities, along with approval issued by the government. This would also include approvals and a No Objection Certificate from various departments for providing infrastructure facilities like sewage, water, electricity, environmental clearance, fire safety approval, etc.
Occupancy certificate
It is compulsory for the seller to obtain the occupancy certificate from the competent authority, before conveying any property to buyers. Use of the property without obtaining occupancy the buyer might be liable for the penalty under the applicable building bylaws besides the risk of demolition of the property.
Check status of tax payment
The buyer must verify with the municipal authorities that the seller has paid all the taxes and not defaulted on payment of property tax.
Encumbrance certificate
It is also important to ensure that the property does not have any dues for which a buyer must verify the encumbrance certificate. An encumbrance certificate provides evidence that the property not has any kind of legal and monetary liabilities. The certificate can be obtained from the registration authority i.e. sub-registrar’s office where the property has been registered.
Khata Certificate and Khata Extract
Khatais an account of a person owning a property. It is general consists of (a) Khata Certificate (b) Khata Extract. A Khata Certificate is mandatory required for the registration of a new property and the transfer of a property. Khata Extract is obtaining the property details from the assessment registrar. It is only needed when property is buying and acquiring trade license.
Physical survey and access to the property
The buyer must undertake a physical survey of the property and confirm the measurement and extent of the property. While you are buying a land it is important to identify and demarcate the boundaries and access to the property and further, ascertain any other physical attributes that may obstruct enjoyment of the property.
Compliance under Regulation and Development Act, 2016
RERA mandates that developers should register their projects with the authority constituted by the law. If a buyer intending to buy a property in a project coming under the extent of RERA then it is advised to verify whether property has been registered with the authority under RERA or not.
Before buying a property it is better to err on the side of caution. With the proper legal guidance,verification of relevant information and inspection of the documentsrelatedto the property, the buyer would be in peace of mind with the investment.