Laws related to registration of property transactions in India

Laws related to registration of property transactions in India

The law of registration of documents is contained in the Indian Registration Act. This legislation provides for the registration of various documents, to ensure conservation of evidence, prevention of fraud and assurance of title.  

The law of registration of documents is contained in the Indian Registration Act. This legislation provides for the registration of various documents, to ensure conservation of evidence, prevention of fraud and assurance of title.

Documents of property requiring mandatory registration As per Section 17 of the Registration Act, 1908, all transactions that involve the sale of an immovable property for a value exceeding Rs 100, should be registered. This effectively means that all the transactions of sale of immovable property have to be registered, as no immovable property can be purchased for merely Rs 100. Additionally, all transactions of gift of an immovable property, as well as lease for a period exceeding 12 months, are also mandatorily required to be registered.

In special cases, when a party to the transaction cannot come to the sub-registrar’s office, the sub-registrar may depute any of its officers to accept the documents for registration, at the residence of such person. The term ‘immovable property’ includes land, buildings and any rights attached to these properties.

Procedure and documents required The property documents that need to be registered, should be submitted to the office of the Sub-Registrar of Assurances within whose jurisdiction the property, which is the subject matter of transfer, is situated. The authorised signatories for the seller and the purchaser, have to be present along with two witnesses, for registration of the documents.

The signatories should carry their proof of identity. The documents that are accepted for this purpose, include Aadhaar Card, PAN Card, or any other proof of identity issued by a government authority. The signatories also have to furnish the power of authority, if they are representing someone else.  In case a company is party to the agreement, the person representing the company has to carry adequate documents, like power of attorney/letter of authority, along with a copy of the resolution of the company’s board, authorising him to carry out the registration.

You need to present the property card to the sub-registrar, along with the original documents and proof of payment of stamp duty. Before registering the documents, the sub-registrar will verify whether adequate stamp duty has been paid for the property, as per the stamp duty ready reckoner. In case there is any deficit in the stamp duty, the registrar will refuse to register the documents.

Time limit and fee payable Documents that have to be mandatorily registered, should be presented within four months from the date of their execution, along with the requisite fee. In case the time limit has expired, you can make an application to the sub-registrar for condonation of the delay, within the next four months and the registrar may agree to register such documents, on payment of a fine that may be up to ten times the original registration fee. The registration fee for property documents is 1% of the value of the property, subject to a maximum of Rs 30,000.

Earlier, the documents that were presented for registration, would be returned to you after a period of six months. However, with computerisation of the offices of the sub-registrar, the documents (bearing the registration number and proof that the documents have been registered by the registrar) are scanned and returned to you on the same day.

Impact of non-registration Failure to register the purchase agreement of a property, could put you at a huge risk. Any document that is mandatorily required to be registered but is not registered, cannot be admitted as evidence in any court of law.

 

Happy Investing

Source:Moneycontrol.com