INVESTIGATION OF TITLE & RECORD OF RIGHTS Prepared by : KRISHMA SHAH (Associate) On Date : 14 May 2016 1
3 Main Steps prior to Purchase of property: Settlement of the terms of the deal between the parties particularly relating to the consideration & the property to be transferred. Preparation and execution of the agreement and, Investigation of title of property. 2
Introduction WHAT IS TITLE? Title - means the ownership right in the property. Title is said to mean the right of ownership and possession of any property. WHAT IS TITLE INVESTIGATION? When search is conducted unto the property of the person who owns it, it is called the Investigation of Title. It is also called SEARCH into the ownership of the property. 3
What is the need and object of Investigating a Title? The investigation is carried out broadly for the following: To ensure that the seller has a clear and marketable title; Property is free from all encumbrances; Property tax has been fully paid up to date; Property is not in any legal dispute and is free from litigation. Hence, Investigation of title is very essential for the ownership to be Complete Free from any doubts, risks & interest and Acquiring and obtaining a good, clear and marketable title 4
What are the attributes of Ownership? Right to have and to get possession; Right to prevent interference by others; Power of alienation; Liberty of using the object according to owner s will; Liberty of enjoying the fruits and benefits arising out of the object owned; Liberty of changing its form and even destroying it. 5
Determination of Title: Determination of Title examining the instruments or documents pertaining to the property Title of the property can either be : Original Derivative Acquired by transfer/act of parties Eg. Sale Operation of law Eg. Inheritance 6
Pre - Investigation of Title: The vendor/ his Advocate to send the title deeds to the purchaser s advocate. The purchaser s advocate signs accountable receipt Undertaking to return the title deeds (without claiming any lien or cost or otherwise). Responsibility of Purchaser s advocate to preserve the title documents. 7
Record of Rights Chapter X of the Maharashtra Land Revenue Code, 1966 deals with the provisions relating to Record of Rights. Section 148 mandates every village to maintain a Record of Rights which shall include the names and particulars of the holdings of a person. Section 149 Acquisition of rights to be reported, entered in the register of mutations, invite objections and report the same in the register of disputed cases, certify the mutation entries and transfer all the entries to the record of rights. Section 150 Every report made u/s. 149 and 154 shall be entered in the register of mutations. 8
Section 154 - When any document purporting to create, assign or extinguish any title to, or any charge on, land used for agricultural purposes, or in respect of which a record of rights has been prepared is registered under the Indian Registration Act, 1908, the officer registering the document shall send intimation to the Talathi of the village in which the land is situated and to the Tahsildar of the Taluka, in such form and at such time as may be prescribed by rules made under the Code. Section 156 In addition to the registers and the record of rights, such other land records shall be prepared as may be prescribed. 9
Steps of Title Investigation Perusal of the owner s original title deeds and verification of the parent documents or prior title deeds. Section 327 of the Maharashtra Land Revenue Code, 1966 states that Subject to such rules and the payment of such fees as the State Government may from time to time prescribe in this behalf, all maps and land records shall, subject to such restrictions as may be imposed, be imposed, be open to the inspection of the public at reasonable hours and certified extracts from the same or certified copies thereof shall be given to all persons applying for the same. 10
In view thereof the purchaser s advocate may do the following: Search in Sub-Registrar s office (S.51, S.55 and S.89) of the Indian Registration Act, 1908 mandates the maintenance of certain books and documents in the registration offices). Collect details on the basis of Cadastral Survey/ City Survey number of the property. Search in Collector s office ensuring payment of all taxes, water charges etc. and defaults thereof (if any). Enquiry with the Municipal Corporation, Assessor and Collector. 11
Enquiry with the Ward Officer to find out : Whether the property or any portion thereof has been notified under the Land Acquisition Act for public purpose or Whether any notice, notification, action or claim is pending against the property. Whether any portion of the property is included in the setback. Enquiry as to whether the property falls under the Coastal Regulation Zone (CRZ) Lis Pendens if any, recorded U/s. 52 of the Transfer of Property Act, 1882. Issue Public notice 12
7/12 extract (7-12 utara) - Gives an idea about the type of ownership, total number owners (and their respective shares in property), loan on the property (if any), tenant in the property (if any), cultivable and non cultivable area in the property, source of irrigation (if any), assessment for the property, class of the property, reservation on property (if any). Register of Mutation (Village Form VI) - Mutations are the entries made by the revenue department in respect of any change in ownership of the property; such changes may be because of death of any owner, loan obtained by any owner etc. At times, it may happen that the name of a person appears in Mutation but not in 7/12 extract. Hence, it is advisable to check all mutations to determine the names of the true owners. This form i.e. Village Form No. VI is also called register of mutation. This Form is actually a record of changes in the record of right. Record of rights - This document enables to find out the entire history of the property in question. It helps us to understand whether the devolution or the transfer of property was by way of Sale, Will, Mortgage, Lease, Exchange, Gift or Inheritance. 6C Certificate (Varas Register) 6C Certificate is a document which gives us an idea about the names of all legal heirs of the deceased person. This document is very important as, it is noticed that some times names of Female Legal Heirs are not appearing on revenue documents, to avoid such ambiguities it is advisable to check 6c Certificate. 13
Maps - It is advisable to check maps provided by the government authorities, this gives better idea about he exact location of the property and access to the property. Ceiling Limit - As per the type of the property there is a limit provided for the holding of the Land. The purchaser must ensure that the Land which he is going to purchase will not cross his limit and he also has to check that the vendor is also not holding it as excess land. The Khate Utara (8 A Extract) is a document which gives us idea about the exact holding of the owner. Village Form No. 8 Gives account details of the holder of the property in respect of the various properties held by him in the said village. 14
Title Certificate After following and complying with all the steps and procedures as laid down, the purchaser s advocate has to prepare purchaser s requisitions on the vendor s title to the property. These requisitions may be:- General requisitions For instance, whether there is any charge on the property, whether there is any repair notice, whether there are any proceedings in the nature of acquisition or requisition etc. Special requisitions For instance, if the Vendor s predecessor in title dies leaving a Will, the question to be asked is whether Probate was obtained of such Will and ask for production of the Probate. If Probate was not obtained, then it is averred that there is a defect in title and state as to how the vendor proposes to cure the defect. Such details and requisitions are special requisitions. 15
The obligation of the vendor to answer the requisitions of the purchaser s advocate is statutory under the provisions of the Transfer of Property Act (S. 55). After complying with all the procedures, steps and requisitions, the advocate for the purchaser issues a Certificate of Title of the Vendor s property. A certificate of title is thus, a statement of opinion on the status of title, based on a thorough examination of documents. A certificate of title provides documentary evidence of the right of ownership. Certificate of Title identifies the owner of the property. An ideal Certificate of Title must contain a detailed explanation of the property and the method or mode of devolution of title upon the owner. However, there is no standard format of a Certificate of Title. 16
Contents of a Certificate of Title: Name of the owner/occupier of the property, Description of property, A chronological list of deeds and documents perused, The nature of title of the owner, Dues and/or arrears of land revenue (if any), Subsisting charge or mortgage over the property (if any), Information as to the actual possession of the property, Adverse interest in the property (if any). Whether the owner has a clear and marketable title and whether the property is free from all encumbrances. The advocate for the purchaser may also tender his advice in the Certificate of Title. 17
THANK YOU 18