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InvestigationofPropertyTitleRealEstateandConstructionIndia

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India:InvestigationofPropertyTitle
LastUpdated:2December2012
ArticlebyUttamHathiandGaurangiPatil
BrusChambersAdvocates&Solicitors

Apropertyisdividedintomovableandimmovableproperty.ThebasedefinitionofanimmovablepropertyasdefinedinThe
GeneralClausesAct,1897U/S.3(26),"Immovableproperty"shallincludeland,benefitstoariseoutofland,andthings
attachedtotheearth,orpermanentlyfastenedtoanythingattachedtotheearth."Animmovablepropertyisalsodefinedin
variousotheractslikeTransferOfPropertyAct,1882,RegistrationAct,1908,TheIncomeTaxAct,1961etc.
Hereinweshalldealwithinvestigationoftitlerequiredforvariouspurposesincludingbutnotrestrictedtosale,butalsofor
lease,sublease,mortgage.Forthepurposeofbrevitythereferenceofsaleshallalsomeantoincludepurposesoflease,
sublease,license,mortgagewhereapplicable.
Titleisalegaltermitmeanstheownershiprighttoproperty.Titleofpropertyistheprimeconcernofeveryoneatthetimeof
purchasingofaproperty.Everypropertyhasatitle.Titleistheevidenceoftherightofownershiporthegroundofrightof
ownership.Titlecanbecreatedbyactofpartiesorbyoperationoflaw.Titleisacquiredbytransferorbyoperationoflaw.The
lawrelatingtotransferofimmovablepropertyisgovernedbytheTransferofPropertyAct.TwootherActscloselyconnectedto
itaretheIndianRegistrationActandtheIndianStampAct.LawofContract,andthevariousStatutespassedbyState
Legislaturesfromtimetotimehaveimportantbearinginthematterofascertainingtitletoimmovableproperty.Lawrelatingto
successionisanotherimportantareaconnectedtoinvestigationoftitle.
Titletoimmovablepropertyisascertainedbyperusingrelevant"Documents"and"Deeds"pertainingtosuchproperty.The
term"Document"hasverywideimport.Undergenerallaw'document'meansanymatterexpressedordescribeduponany
substancebymeansofletters,figuresormarkforthepurposeofrecordingthatmatter.Thedocumentsrelatingtopropertyor
commercialtransactionsaregenerallycalledInstrumentsorDeeds.
Investigationoftitleisveryessentialsincetheownershipofthepropertyisrequiredtobecomplete,fair&freefromanydoubts,
risks&interest.Toensurethisaninvestigationismuchneededsothatapurchasercantakeallnecessarystepsatthetimeof
acquiringpropertytoobtainagood&cleartitleoftheland.Whensearchisconducteduntothepropertyofthepersonwho
ownsit,itiscalledtheInvestigationofTitle.Itisalsopopularlycalledas'SEARCH'intotheownershipoftheproperty.The
investigationiscarriedoutbroadlytoensurethatthepropertyisindeedinthenameofthepersonselling,isfreefromliens,
mortgagesandencumbrances,thatthepropertytaxhasbeenfullypaiduptodateandthatthepropertyisnotengagedinany
legalconflicts
Theinvestigationoftitleisastepastowardsanagreementofsale.Anagreementofsalehasthreemainstepprecedingthe
completionofatransactionofsaletheyare:(1)Settlementofthetermsofthedealbetweenthepartiesparticularlyrelatingto
theconsideration&thepropertytobetransferred,(2)Preparationandexecutionoftheagreement&(3)Investigationoftitleof
thetransferofproperty.
Theobjectofinvestigationsoftitleistoascertaintheownershipandtitleofagivenproperty,inmostcasesimmovablein
nature.Theattributesofownershipare,(1)righttohaveandtogetpossession(2)righttopreventinterferencebyothers(3)
Powerofalienation(4)libertyofusingtheobjectaccordingtoowner'swill(5)libertyofenjoyingthefruitsandtoavailofthe
objectowned(6)libertyofchangingitsformandevendestroyingit.Theoriginofownershipisinpossession:Actual
possessionimpliesarighttoretainituntilthecontraryisprovedandtothatextentpossessorispresumedtobetheowner.The
conceptofownershipgavebirthto"title"andtheideaoftitleasthebetterrighttoobtainorretainpossessionevolvedthrough
troveranddetenue.Aperson,whowouldsucceedinestablishingabetterrighttohavepossessionthantheother,wouldbe
theowner.Alltitlestolandareultimatelybasedonpossession.ThisisthepositioninEnglishlawaswellasIndianlaw.There
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isadictum,whichsaysthatsofaraslandisconcerned,thereisnolawofownershipbutonlyalawofpossession.Personcan
havecontroloverlandonlyifheisdirectlyincontactwiththeland.Inotherwordspersoncancontroloverthelandifthelandis
underhispossession.Itdirectlymeansword"possession"andword"ownership"goestogether.Possessionismostimportant
componentoftheownership.Ifownerisnotintouchwithlandandsomebodyelseishavingcontrolovertheland,underthe
circumstancesownerloseshisownership.Therearelegalprovisionsforgrantingownershiptothepersonhavingcontrolon
landforlongperiod
Investigationoftitleisanintricatematter.Thereisnostandardperiodprescribedfortherootoftitle.Aftertheexecutionofthe
agreementofsaleitwillbethedutyofthevendor'sadvocatetosendtothepurchasersadvocatethetitledeedsoftheproperty.
Thesetitledeedsaresentinexchangeofanaccountablereceipttobesignedbythepurchasersadvocate.Thepurchaser
advocatesignstheaccountablereceiptandkeepsacopythereofwithhimwiththetitledeeds.Investigationoftitlestartswith
thepresentowner'soriginaltitledeedwhichwillalwaysbe'thedocumentoftitle'totheproperty.Oncetheoriginaldeedis
perusedtheinvestigatorproceedstoverifytheparentdocumentsorthepriortitledeedsTheworkthenofinvestigationoftitle
bythepurchasersadvocatecommencesHewillthantakesearchesintheofficeofthesubregistrartofindoutallthe
documentsrelatingtothepropertywhichisthesubjectmatterofsalewhichareregistered..Towhatextentanduptowhat
periodthepriortitledeedsaretobeperusedvaryfromcasetocase.Thesafestthingistoperusethetitledeedsforthelast30
yeas.Thereasonsforthispropositionare(1)theperiodofLimitationagainstGovernmentis30years(2).UnderSection90of
theEvidenceAct,adocument30yearsormorearepresumedtobevalidlyexecuted.(3)Thecontentsofanydocumentare
presumedtorepresentthecorrectagreementorunderstandingbetweenthepartiesthereto.Howeverasearchforthelast12
yearsistreatedasnormallysufficient.Ifthetitlecannotbereasonablybeascertainedwithin12years,thenitisnecessaryto
gobackasmuchasnecessary.Inadditiontoascertainingtheowner'stitle,itisthedutyoftheinvestigatortoruleoutthe
possibilityofanysubsistingchargebywayofequitablemortgageonthepropertyunderinvestigation.Forthis,perusalofall
originaltitledeedsforthelast12yearsorevenmoremaybecomenecessary.
InMaharashtratocheckthetitleverificationofthepropertytheinvestigatormustdothefollowingchecks:a)Recent7/12
Extract(712Utara):Itwillgiveideaaboutthetypeofownership,totalnumberowners(andtheirshareinproperty)ofthe
property.Loanontheproperty,tenantintheproperty(ifany),cultivableandnoncultivableareaintheproperty,sourceof
irrigation(ifany),assessmentfortheproperty,Classoftheproperty,Reservationonproperty(ifany).b)Allmutationson7/12
extract(Ferfar):Mutationsaretheentriesmadebytherevenuedepartmentinrespectofanychangeinownershipofthe
property,suchchangesmaybebecauseofdeathofanyowner,Loanobtainedbyanyowneretcsometimeitmayhappenthat
nameofanypersonappearsinMutationbutnotin7/12extract,tochecksuchthingsitisadvisabletocheckallmutations,c)
Maps:itisadvisabletocheckmapsprovidedbythegovernmentauthorities,thisgivesbetterideaaboutheexactlocationof
thepropertyandaccesstotheproperty,d)CeilingLimit:AsperthetypeofthepropertythereisaLimitprovidedforthe
holdingoftheLand,thepurchasemustcheckthattheLandwhichheisgoingtopurchasewillnotcrosshislimitaswellashe
havetocheckthatthevendorisalsonotholdingitasexcessland.TheKhateUtara(8AExtract)isadocumentwhichgivesus
ideaabouttheexactholdingoftheowner,e)6cCertificate(VarasRegister):6cCertificateisadocumentwhichgivesus
ideaaboutthenamesofallLegalHeirsofdeceasedperson.Thisdocumentisveryimportantas,itisnoticedthatsometimes
namesofFemaleLegalHeirsarenotappearingonrevenuedocuments,toavoidsuchambiguitiesitisadvisabletocheck6c
Certificate
LisPendensifany,recordedU/S.52oftheT.P.ActshouldalsobeverifiedwiththeDistrictSubRegistrar.Itwouldalsobe
necessarytotakesearchintheofficeofthecollectoroftherelevantrecordsanditwouldgivethebuyer'sadvocatethetitleto
thepropertyandshowhowtitlehasdevolved.Nodoubtshouldbeleftunansweredandnothingshouldbetakenforgranted
whereacontinuitylinkisbrokenandwithoutsatisfactoryexplanationforthcomingtherefore.
SometransactionsareunregisteredtochecksuchtransactionitisadvisabletothepurchasertoPublishnoticeatleastintwo
LocalNewspaperandaskforobjectionsthishelpsthepurchaseradvocatetosatisfyhimselfaboutthetitleoftheproperty.
Claimsareinvitedinthenatureofmortgage,lien,charge,lease,easement,gift,trust,oranyotherclaimagainsttheproperty
whichisrequiredtobenotifiedtothebuyersadvocatewithinaperiodof15daysafterwhichitshallbedeemedtohavebeen
waived.SuchPublicNoticesupportsthebuyer'scontentioninthecaseofdisputethatheisabonafidepurchaserforvalue
withoutnoticeofanyclaim.
AnEnquiryinBombayMunicipalCorporation(BMC)isnecessary(ifapplicable).Itmustbeinquiredwhetherthereareany
claimstothepropertyconcerned.AlettertobeaddressedtotheAssessorandCollector,BMC,tofindoutwhetherthereare
anyarrearsofmunicipalbillsorwaterchargesorriotbillsinrespectofthepropertyagreedtobepurchasedbythebuyer.An
EnquirywiththeWardOfficermustbemadewiththeWardOfficerinwhichthepropertyissituatedtofindout(1)whetherthe
propertyoranyportionthereofhasbeennotifiedundertheLandAcquisitionActforpublicpurposeor(2)Whetheranynotice,
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notification,actionorclaimispendingagainsttheproperty.(3)Whetheranyportionofthepropertyisincludedinthesetback
and(4)whetherthereisanynoticependingagainstthesaidproperty.
AnenquiryisalsotobemadeinCRZandotherzonesasitisnotallowedtoanydevelopmentinsuchzonesitisnecessaryfor
thepurchasertochecksuchzonesbeforesigninganydeed.Thepurchaseralsosatisfyhimselfthatthesellerisnotgoingto
becomeaLandlesspersonaftersaidpurchaseofland.
Thetitledeedshavetobegonethroughafterarrangingtheminchronologicalorderandthenprepareanabstractoftitle.The
abstractmustcontaininanutshellrelevantinformationrelatingtothedeedwhichisabstracted.Anabstractoftitlecontainsa
gistofthedocumentscommencingwithrootoftitleandfactswhichconstitutethevendor'stitle.
Forclosureinasaleafterallthesereportspurchaser'srequisitionsonthevendor'stitletothepropertyistobeprepared.The
requisitionsareoftwotype'sgeneralandspecialrequisitions.Specialrequisitionsareobjectionsraisedbythebuyeron
scrutinyandappraisalofthedocumentsproducedbythevendor,andrelatetotitleordefectsinconveyance.General
requisitionsaremoreorlessofaroutinetypeofinquiries.Asetofgeneralrequisitionsarethosewhichonemayadopttosuita
particulartransaction.
Thereafterarisesthestageofpreparingdraftoftheconveyance.Thefollowingpointsaregenerallycoveredinthedeed.,1]
Indemnity/Guaranteefromthepresentownerabouthistitleoverproperty,2]Indemnity/Guaranteefromthepresentowner
abouthispossessionoverproperty,3]Indemnity/Guaranteefromthepresentowneraboutnonreservationoftheproperty,4]
Pointmakingclearthatthesaidpropertydoesnotrelateswithanypublicactivity,5]Pointmakingclearthatthesaidpropertyis
notaTrustProperty,6]PointmakingclearthatsaidpropertyisnotaGovernmentGrantedLand,7]Pointmakingclearthatno
onehasanyright(road/parking)oversaidproperty,8])Pointabouttheexistingstructureonproperty(ifany).Becauseitmay
affectvaluationoftheproperty,9]Ifthesaidpropertyisancestralonethenitisnecessarytomakeallmembersofthefamilyas
consentingpartiesforthedeed,10]Purchasepriceofthepropertyisagreedmutually,withthescheduleofpayment,11]The
PhotoIdentityCardsofthepresentownersmustbeattachedtotitledeed,12]Indemnity/Guaranteefromthepresentowner
aboutNonLitigantpropertybecauseanytransactionforapropertyforwhichlitigationispendingisnullandvoidintheeyeof
law,13]Boundariesofthepropertygivesclearideaabouttheexactlocationoftheproperty.Thereforeitisnecessaryto
mentionitclearlyintheTitleDeed,apartfromthisitisadvisabletoattachamapshowingexactlocationoftheproperty.,14]
WitnesstothedeedplaysveryimportantroleifthedealgoesintoanyLitigation,Itisadvisabletotakeoneownerofadjoining
propertyaswitnessasitwillhelptoprovepossessionofthepresentowner..
Alsotheanincometaxclearancecertificatemustbeobtainedundersection230Aoftheincometaxact.Allnecessary
registrationandstampdutymustalsobecompliedwith.Thusinvestigationoftitleisaveryvastprocedureanditplaysprime
roleinmattersofproperty.
Thecontentofthisarticleisintendedtoprovideageneralguidetothesubjectmatter.Specialistadviceshouldbesoughtabout
yourspecificcircumstances.
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