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How to verify a title deed

Immovable property cannot be sold by a mere letter of allotment and would require execution of a deed of conveyance

Buying a new house or an apartment will require a buyer to take a few measures to ensure a good title. Immovable property cannot be sold by a mere letter of allotment and would require execution of a deed of conveyance commonly known as a sale deed by the seller in favour of the buyer.

The following checklist will help verify the title:

(i)    The title deed /document is in the owner’s name, issued by the revenue record department under the seal of the tehsildar

(ii)     The owner’s title for the preceding 15 years (at least) shows no encumbrance(s) such as a mortgage existing

(iii)    The property is transferable and heritable

(iv)     The transferor is competent and/or authorised to transfer the property

(v)      The property is freehold.  In the event the property is a leasehold one, the prospective buyer will be required to submit an application to the authority in Noida to obtain a transfer memorandum, which is issued only after verification and whereafter, the purchaser will have to ensure execution and registration of a sale deed. The purchaser will have to check whether the lease rent payable is one time only or on a yearly basis and whether there can be any increase at a later date

(vi)     All receipts etc. pertaining to payment of taxes, electricity bills, and water bills must be checked

(vii)     The buyer could submit an inspection form along with Form 29 to the Sub registrar’s Office, to provide information on the location of the property and the date of original registration of the property.

(viii)   In the case of newly-constructed apartments, it would be desirable to require the builder to offer for inspection and verification of all necessary permission including sanctioned plans and environmental clearance if applicable

(ix)   The next step is to have the sale deed stamped with the requisite stamp duty and submitted to the office of the jurisdictional sub registrar of assurances. The buyer and the seller would be required to be present and complete prescribed formalities

(x)     The final step is to have “mutation” effected in the name of the purchaser by submitting an application together with prescribed an affidavit, indemnity bond, and a certified/ notarised copy of the registered title deed.  The circle revenue office will thereafter issue a mutation letter in favour of the buyer
More>>  Property Buying Tips

Pratap Venugopal is a partner at K.J. John & Co, an advocate firm based in Noida


What to follow while buying pre-launch property

Buyers need to also check out several aspects before putting their hard-earned money in such Residential projects.

Prices of pre-launch apartments  and under-construction stage are no doubt attractive. According to Happy Keys data, average pre-launch prices of flats are 25-30 per cent lower than those nearing completion.

But in this situation, buyers need to also check out several aspects before putting their hard-earned money in such projects.

Cross-checking all clearances

At the top of the list is the necessity to check if the project has got all the required clearances regarding land ownership and construction.

The prices in Noida of pre-launch and under-construction properties is attractive and as the construction reaches completion, rates rise up significantly,” says Rahul Adhirej of Adhirej Consultants, a property advisor and consultancy firm in Greater Noida.

In their enthusiasm at getting an attractive price, buyers tend to miss checking basics such as clear ownership, sale deeds and construction approvals (till which floor). I often go the extra mile and show them the papers and have even recommended them to opt for a lower floor as the one they want has yet to get the approval.

A pre-launch or an under-construction property carries a certain degree of risk. The buyer might face delay in possession if the project is stuck due to certain issues, some of which may be extraneous aspects.

There are other factors too that a prospective buyer should be aware of.

The current tax law

The current tax law states that the benefit of tax deduction on home loans is “not applicable for properties that are under-construction”. The benefits are available only on constructed properties and only if the registration is done.

Title diligence

This is the key as it forms the basis for several legal documents and agreements.

The first step when going in for pre-launch or under-construction property is to ensure clear ownership of the developer/seller sale deed by conducting title diligence,” says Sadhanand Mishra, and advocate and solicitor who specialises in real estate deals.


Check out : Checklist For Investing In Pre-launch Property


Independent legal assessment

Although a clear set of documents is presented to the buyer at the time of booking, it also makes sense to do an independent assessment using the services of a legal expert specialising in real estate.

Getting an independent assessment and evaluation of all the documents is something the buyers must get done,” says Mishra. “Also, opting for deferred payment made strategically after set targets are completed is a good option. This ensures lesser investment and tracking of progress of the construction, as per the demand letter of the developer.

Acquiring payment receipts

Payment of booking amount and every following amount paid must be made followed by payment receipts. For example, the developer can collect up to 20-40 per cent of the cost of the apartment at the time of booking depending on the payment option chosen by the buyer. And for this, a receipt needs to be given by the buyer.

Knowledge of Ownership Act

Ownership Flats Acts vary from state to state and prospective buyers must check with their legal expert before buying in Delhi NCR. At an average, a developer can collect up to 20 per cent of the total price without entering into a registered agreement for sale. This means it is only after you cross the said percentage that you can insist on a registered sale agreement.

While entering into the agreement for sale, it is essential to ensure that all approvals, right up to the commencement certificate for the property to be purchased, are in place.