Sidharth, who is working on a software firm purchased a flat for Rs. 46 lacs in Bangalore. He is almost paid all his savings as the down payment and got the loan from one of the reputed bank for 20 years. He is paying the monthly EMI of about Rs. 35000. When he came to know that there is problem on layout plan and there is no proper sanction from the government, he has no clue what to do. He could not reach his builder for the clarification. This is a real problem in many of the real estate projects in Bangalore.
If you are looking to purchase a flat in Bangalore, trust me that you have to do lot of ground work for verifying the documents. There is a list of documents which has to be verified to prove that the property you are looking for is good to purchase. This article explores the maximum possible list of documents which would be important to be verified before making any decision. In the current scenario, rental expenses are very high, instead I would suggest to purchase a flat. What is your opinion? Please write it in the comments section or join our facbook fans page.
This article is only for the guidelines for verifying the documents and does not guarantee the validity of all the information provided here. Here the information listed are based upon few cases, in some cases some of the documents listed down may not be suitable. I would advise to take through consultation with a property lawyer near to your locality. He must be the best person to help you on validating all the documents.
1. Parent Deed / GPA
This is one of the most important document to trace the ownership of the land and flat. This document is is primarily to trace the ownership of the land where apartment complex is constructed. In most of the cases, there is a dispute on the ownership of the land after the construction is completed. Builder would not reveal the facts while you are purchasing the flats, it is your responsibility to verify the parent deed and title holder of the land, also ensure that there is no case on court for the land. It is not easy to find out if any on going case on the land, you have to try your luck to find the maximum information on the property.
General Power of Attorney (GPA) is the common practice among the real estate market. It is a right given to another person (most likely who is making the layout and selling to others) for selling the land on behalf of the owner. For example, Mr. X is a farmer who owns 2 acre of land is situated on the proximity of the city. Mr. Y who is running real estate business approaches to Mr. X for converting his land as residential use and selling as plots. Then Mr. X gives GPA to Mr. Y.
If the GPA is no valid, any other transactions occurred after the period would become invalid including the construction of the apartment. So, it becomes important to verify the validity of GPA.
2. Sale Agreement / Sale Deed
Sale Agreement and Sale Deed are two different things which is very often misunderstood by lot of buyers. Sale Agreement is a simple agreement between buyer and seller about the list of rules and regulations of the transactions. It is good idea to to carefully read the sale agreement before signing on it. Normally builder sign the sale agreement and give to buyer. This document is valid only till the construction is completed. It is always written for the future date. This contract can be terminated if the rule specified in the document permits.
Sale Deed is totally different from the sale agreement.It is very important document for transferring the ownership of the property (land or apartment) from the seller. This document is registered with the sub-registrar office. At the time of registration, buyer has to pay the stamp duty and the registration charges. Once sale deed is registered, it can not be cancelled or terminated.
- The sale deed is maintained by the Registration Act and should be considered important by both the buyer and the seller of the property.
- A property without a sale deed is incomplete and cannot be sold or purchased by either the buyer or the seller.
- The sale deed contains the following details:
- Buyer name
- Complete address of the property and location
- Identification number of the property
- Many other details about the property
If you sell/transfer your property, you should have Khatha for that property. Khata is an account of a person who has property in the city. Khatha is an account which reveals the details of a property like owner name, size of the property, tax paid, location of the property, etc. This is a most important legal document for finding the person who are liable to pay the tax for the property.
If you are buying a flat from the builder, the Khatha for the land will be in the name of land owner or builder. After the purchase of flat, buyers has to apply for the khatha transfer through the registrar office. (Read: Khatha A or Khatha B – How to apply in Bangalore?)
4. Encumbrance Certificate (EC)
Encumbrance Certificate is an important evidence to prove that your property is not under any liability like outstanding loans. If you request for EC from registration authority’s office, it is a computer generated document which contains all the previous transactions related to the property. Generally it is advised to check for the past 30 years transaction on the property. EC is provided only for the duration we have mentioned at the time of request application. This document clearly specifies the current owner of the property and earlier transactions.
5. Layout Plan / DC Conversion Approvals
What is DC Conversion?:
- If you are planning to construct a house or any building on agriculture land, then first you have to seek for the conversion of agriculture land to the residential status. Otherwise it is not legal to construct any building on the land.
- Conversion is a legal process by which the property owner changes the use of the land from agriculture to non agriculture purpose.
- The property owner has to seek permission to convert the agriculture land to non-agriculture purpose by sending application to Deputy Commissioner. If he approved the request, then that said land is DC converted. He will issue a certificate stating that the said land is eligible to use for the residential or commercial purpose.
Once land is DC converted, it will be surveyed and builder or real estate person will make as layout with number of plots, park area, road, etc. and submit to the govt. authority for the approval. Govt. specifies set of rules that has to be satisfied to approve as a layout. If the submitted layout meets all the standards, then that layout will be register with the govt. records. It is the original layout, any deviation in this plan will have problem in future.
Buyer has to compare the original layout with the one shown by the builder. If there is any mismatch, then it is deviated.
6. Occupancy Certificate
Occupancy Certificate (OC) is issued by the BBMP/BMP authority to the builder after completion of the apartment. As per law, no one is allowed to stay (legally) in the premises where OC is not yet approved by the authorities. It is illegal to stay without getting the approval for the occupancy.
- It takes only 30 days to get the occupancy certificate.
- This certificate will be issued only if the construction is followed as per the plan approved by the govt. authorities. In Bangalore, most of the apartments don’t have this certificate. If there is any deviations in the construction, it has to be regularized by law and then apply for the OC to the concerning authorities.
- If there is any commercial activities inside the premises, OC will not be issued.
- OC is issues after the inspection done by the authorities. This includes inspections by the Fire Service Department.
- Within one month after the completion date, builder has to apply for the certificate.
- A comprehensive write up on occupancy certificate here.
I hope this article would have provided more details about the list of documents to be verified while buying a flat in Bangalore. There is no definite set of instructions can be given for verifying the property. Every cases would be different and different set of documents may be needed for that purpose. If you have any questions regarding the documents verification, please write it in the comments section or join the facebook fans page.
I have found few good articles talking about this topic: