Everyone wants a roof of their own. Everyone loves putting their nameplate on their property. Who likes giving rent at the end of each month and abiding by the rules of the tenant? Isn’t it? Investing in properties is one of the notable investments. For instance, your wife chooses a flat. Now you have to break your FD or take a loan or withdraw EPF etc. for buying. Ever thought the procedure is so long? Ever thought of ways to avoid and legal disputes related to it? In this article, we’re going to throw light on how to register your property in India.
Who Can Buy Immovable Property In India?
Immovable properties cannot get shifted from one place to another. It generally includes a flat, house, or land property.
i. NRI: It refers to Non-Resident of India, i.e., if you’re staying outside India. You’re free to purchase any immovable property. Except for any agricultural area/plantation area/farmhouse.
But if you’re a keen agriculturist then, you can purchase an agricultural area. However, you must buy in the name of a close acquaintance, who lives in India.
ii. PIO or Person of Indian Origin: That is, you must be of Indian origin. Citizens of China, Pakistan, Bhutan, Sri Lanka, Afghanistan, Iran, Nepal, or Bhutan are debarred from this. Added to that, you must be carrying your Indian passport with you always. Either your father or grandfather must be a citizen of India under the Citizenship Act, 1955.
The general permission, however, permits you to purchase any residential/commercial property.
How To Buy An Immovable Property?
Mentioned below are a few ways to buy immovable property-
- By purchasing- This applies to all states of India except Jammu and Kashmir
- Through gifts, trust, etc.
- Inheritance by the legal heir or related
- By Will
- Government or court grants
Property Registration In India
The introduction of computers and technologies has lessened the workload and time-taking. Earlier, there was so much paperwork and physical mapping and all. Look today! It’s all mere verifications, money exchange, paper signing, and owning property.
The computerized system has made the entire procedure so transparent. No misinterpretations, least cheating possible, and better, easier work. It has also excluded the indulgence of mediators, thus no frisking with money.
Yet, the computerized system has not been completely erased. In some states, the sub-registrar of your locality interrogates to submit applications to various authorities. Earlier, the documents after registration get returned after 6 months. With computerization, the documents get returned to you, on the same day itself.
You can easily download the application from sites of respective departments online. Else, you can get it physically from the concerned authority’s office. This has made the property registration process easy.
Types Of Property And Property Registration Criteria
There are different categories like agricultural plot, commercial, etc. under property types. Each category has a different criterion and its own requirement. You must go through it before buying it.
a. Make sure you’ve gone through all the legal checks related to its history, third parties, etc. before purchase. Check that the plot is government approved, approved building plan, etc.
b. Draft a sale agreement on stamp paper. It must contain all the requisite points like any advances given, total land cost, dispute resolution method, and default clearing (if any). You must sign it as well as make the owner sign.
c. The preparation of the title deed is a must.
2. Agriculture Plot
a. The agricultural land is a thin string choose on. It has several stringent points that you must certify before thinking of buying it.
b. The agricultural plots are under the control of state laws. The state laws vary from one state to another. Yet, one thing is common that NRI/PIO/OCI cannot purchase it. They are completely debarred. But, in certain cases, they can buy it in the name of someone who’s living in the same country.
c. Most states do not permit non-farmers to buy agricultural land. Until and unless you certify that:
- Either you previously owned agricultural land, or
- Your father/grandfather was a farmer, or
- You’ve business linked with farming.
d. If you do not qualify for the above reasons, the only way possible is conversion. That is, the agricultural land must get converted. You must transform it into non-agricultural land. However, not every state proposes a provision of conversion. The District Collector is the authority in charge of conversion.
e. Another important thing is to check the sharing of allay for power lines, water allocation, etc.
3. Commercial Plot
It includes commercial buildings, offices, shops, etc. in commercial areas.
a. Make sure that your budget fits into the demand of the plot. Normally, commercial plots are high priced. Clear out the location, purpose of business, uses, fits with the plot.
b. Examine the documents of ownership, NOCs, environmental clearances, sharing of water, etc.
c. Sign an agreement with the owner when you’re ready for the investment. It must include the mode of payment, total cost, advances, if any, payment time, etc.
d. After the payment, ask for the letter of allotment, possession letter, etc.
4. Residential Plot
The residential type plots also include apartments in addition to residential houses.
a. You can either get it directly from builders/developers or owners on a resale.
b. This point is common with all, i.e., checking of documents.
c. When you’re sure of the investment, make sure both parties sign it. The agreement must include all the terms and conditions, payment timing, etc.
d. Receive the possession letter, letter of allotment, required during claiming of ownership.
New Rules For Property Registration In India 2019
The rules are always modified no matter what. Sometimes it becomes more lenient while at other times strict. For now, let’s know about the new rules for property registration in India 2019. First comes the stamp duty.
Stamp duty is a type of transaction tax imposition. By this, you can create or diminish any rights or liability. Property registration charges depend greatly on the actual price of the property. The registration price is 1% of the total value. Yet, the stamp duty is highly variable from one state to another. In some states, it’s 3%, while in some, it’s 7%. It ranges between 5-7% of the property price on average.
As we’ve already known that the stamp duty varies from state to state. It also depends on other criteria like-
- Whether the property is new or an old one.
- The age of the possessor.
- The place where the property is, i.e., a city or village.
- If the property will get used as a home or a mercantile purpose.
After stamp duty, next comes Registration. After getting done with your stamp duty, make sure you register your property. Until you name that property in your name, you cannot be called the authentic owner. So, register within a few days.
- For big apartments, high expansion space is taken into consideration.
- Suppose, for a house, the entire space gets considered in per foot unit.
- In plots, the value of that area as per which state guidelines is taken into account. With that, the total area in square foot gets multiplied.
Mentioned below is an image showing the stamp duty that is presently prevailing in various states.
We’ll know about it in detail in the following paragraphs. So, keep reading, folks!
Factors Depending On The Property Registration Charges
You must finance the stamp duty and registration charges. You must do while transferring the ownership to the state government while buying. Since it’s a state tax, it varies greatly from one state to another, and its amount depends on:
a. Whether it is a new property or an old one, there are comparatively more charges for a new property than a second hand. Since the registration fee is a part of the total property value, it will rise for a brand new property than a second hand. Isn’t it?
b. Suppose it’s located in a city or rural area. Normally, rural areas have lower charges than urban areas. Urban areas have better access to markets and easy facilities. So such properties have a higher charge; thus, the registration fee is higher. It is different from rural areas with cleaner air to like more, but urban properties value more.
c. Your age: Some states provide rebates to elderly citizens.
d. Some states also pose a concession for female buyers. So, you can get it transferred in your wife’s name and get the registration done at lower charges.
e. Suppose you’re using the property for commercial or residential purposes. Commercial properties comparatively charge more. Since they’re created for a business purpose, it may need extra amenities like a gym, swimming pool, etc.
Flat Or A House Property Type
For instance, in Karnataka, the stamp duty registration fees are 5% of the property’s total cost. If your property costs Rs. 20 lakh, you must finance the stamp duty of Rs. 1 lakh (5% of the total amount).
After paying the stamp duties, the document gets registered under the Indian Registration Act. The sub-registrar of the locality tenders it.
Procedure For Registration of Property
The title search is an important practice you must undertake before acquiring a property. It marks the property as free from criminal charges, marketable, and without any disputes.
Make sure you scrutinize the documents for the last 40-60 years. Yes, you saw it correct, last 40-60 years. Expending such a big amount means you must be 100% sure about the property right.
To avoid any adverse conflicts, make sure you examine the documents for the last 12 years. If it’s an illegally acquired property, examine for 30 years, min. After examining the property, its physical measurements, and the property’s transformation from the previous owner to new, you must find. Also, check the documents if the owner has paid the required statutory dues, clearances, etc.
Firstly, estimate the cost of that property according to the circle rate in your locality. For instance, if you live in a rural area, your locality’s circle rate would get framed less than an urban property. Know more about the property, whether it’s sold by the builder or secondary seller. In case you’re buying from the builder directly, it would be much easier than the secondary seller to get your documents registered.
Next, compare the circle rate you calculated with the actual amount paid. As stamp duty payment, the one with the higher amount gets chosen. For instance, if the circle rate is Rs. 10 lakh and the actual amount paid is Rs. 9.5 lakh, you pay Rs—10 lakh as stamp duty.
Next, get some non-judicial stamp papers for the calculated value. You can get these stamp papers online as e-stamp papers from www.shcilestamp.com. You can also get them from licensed vendors.
Submit the stamp duty payment slip as proof.
Next, prepare the deeds and type them on the stamp papers. On the stamp duty, get the sale deeds typed on it. Make sure an authorized attorney does it on your behalf. The subject can vary under the transaction. It can vary under sale, mortgage, power of attorney, etc.
In this step, you need to rush to the Sub-Registrar’s office and get your deeds registered. Make sure you carry with yourself two witnesses.
Carry with yourself the original copy of the deed and two Xeroxed photocopies. Added to that, each person involved, i.e., you with your respective have carried their photos and identification documents.
After the registration, you receive a receipt. Then after 2-7 days, you can receive your sale deeds from the sub-registrar’s office.
Finally, get the original deeds verified using the date from the Registrar’s office and registry details.
Until in the government record, the property documents get transferred to your name, you’re not the official owner.
Important Points To Note
- Before the date of initiation of the procedure, keep all your documents in a folder.
- Don’t sequence and watch them again and again. Just make a list on a rough paper, sequence them, and put it in the folder.
- Before you leave for the Sub-Registrar’s office, make sure you carry your documents folder.
- The Sub-Registrar’s office is operational between 9.30 am to 6 pm on all working days. There’s a lunchtime break between 2-2.30 pm. So, plan your schedule accordingly.
Documents Required For Registration Of Flat
There are various documents which are required for the registration of flat like-
- Sale deed
- Partition Deed
- Conveyance Deed
- Gift deed
- Power of attorney
- Lease deed
However, it holds a major part of costs in real estate property registration.
Time Limit For The Registration Of Your Flat
The max time limit for submitting documents for registration is 4 months from the date of attainment. In case you’re executing the documents from abroad, there’s still a strategy for you. You have to present it after within 4 months of arrival in the country.
However, if the time limit exceeds, you need to draft an application to the Sub-Registrar. Mention the condemnation of the detained. It may get accepted by the registrar based on your documents provided. Yet a fine up to 10 times the original registration fee gets imposed.
The registration fee is 1% of the property value. Yet, it must not exceed Rs. 30,000.
Who Can Be The Witness For Property Registration?
Your witnesses are very crucial in your registration procedure. They should be the people you know very well. They need to go with you in all your proceedings. Most importantly, make sure they carry their respective photos and valid ID proofs with them.
Your witness, who signs on the last page of the document, is called the attesting witness. It clarifies that you’ve carried out all the registration processes in his presence. Attesting witnesses need at least two candidates for attesting a document.
Property Registration Online
Not all states permit online property registration. If your state does, apart from considering yourself lucky, go through these key facts-
You can complete only certain parts of the procedure such as:
- The circle rate in your area and calculation of the total value of the property.
- Calculation of the stamp duty and registration amount.
- You can even pay your stamp duty and registration fees online. Then, the receipt can get awarded for the same.
- Making an appointment online for visiting the Sub-Registrar’s office.
TDS Value On Online Payment
If the value of your property exceeds Rs. 50 lakh, there is a tax imposition of 1% on the property price. You need to pay it online and get a receipt for further proceedings. This receipt is required during physical verification in the office.
Property Registration Documents
For online registration, keep e-stamps and your debit/credit/any online payment mode ready with you. Yet, apart from that, there are some more information you need to provide like-
i. Description of your property- area, pin code, etc.
ii. Property type- whether it is a flat or house or agricultural field, etc.
iii. Ownership mode- mortgage, lease, sale, etc.
iv. Personal detail of the owner- name, age, occupation, etc.
v. Property proof- Power of attorney, deeds
Procedure For Online Registration
You cannot do much in online registration, except:
i. Form e-stamp online that you can download from the site.
ii. Pay online using card payments or net banking.
iii. Get an e-receipt of payment and stamp duty.
After getting those, you have to rush to the Sub-Registrar’s office for the physical paperwork.
Documents For Physical Verification In Sub-Registrar’s Office
i. A non-judicial stamp with the property deal
ii. 2 passport-sized photos of yours as well as seller’s on copies of documents
iii. E-stamp receipt with appropriate stamp duty
iv. E-registration fee receipt
v. Xerox copy of your PAN card
vi. TDS receipt, if your property is more than Rs. 50 lakh.
vii. In case you’re purchasing land and the house, the buyer must provide a history of ownership transfers.
viii. Carry with yourself all the original ID proofs.
Land Registration Process in India
The land registration process involves the change in ownership from the owner to a buyer. Any property you buy or get a gift, you must get it registered. It suggests a legal authority over your property and disapproves of several disputes. It reduces the risks due to several frauds and disputes, which can further lead to criminal cases.
Procedure For Land Registration
1. Verbal Agreement
The verbal agreement must get carried out between you and the property owner before any final judgments. You must make discussions on price negotiations and physical inspection of the property.
2. Contract Preparation
After you agree with the seller, you must make a paperwork contract about it. To make things more authenticate, make sure you contact a lawyer. Sometimes there are fraud cases too. So, it’s better to seek a lawyer’s advice and proceed. Added to that, immovable property worth your years’ savings. Thus, it doesn’t worth taking any risks.
3. Pay Stamp Duty And Registration Fees
After making the sale deed, jump to stamp duty. As said earlier, it’s completely variable from state to state. It may range from 3-7% of the property worth. The registration fees involve 1% of the total property value. Yet, it can also vary from one state to another.
4. Registration Of Sale Deed
After completing contract formation and deeds, rush to the Sub-Registrar’s office. Make sure you bring with yourself all the required documents.
5. Mutation Of Property
Then, finally, you get your property mutated inland and revenue records. The local municipal authorities must do it.
The entire procedure may take about 5-7 days to complete. Yet, it’s utmost required to do a complete survey about the land before purchasing. Whether it was an agricultural land or commercial area, make sure you choose your land usage. For instance, if there’s a factory plot nearby, you cannot think of making it an agricultural field or any other purpose. Such things you must consider.
Since property purchase involves a high amount of exchange, buying from a genuine broker is safe. You can also buy from the landowners without indulging any middlemen. This would reduce the extra cost of commission and hurdles.
Yet, many laws about land and the Registration Act, 1908, are framed for making passage easier. It ensures a legal pathway for registration and transaction. This legal pathway uses all the tax levied in such a process for the development of the country. That is, your hard-earned money won’t go in bad hands, and your property is safe too!
Land Registration Online
Like other property registration, even land registration doesn’t include much work online. Things can move fast, no doubt, but the final verification and registration need physical verification.
- You can download the form online.
- Next, you have to pay stamp duties and registration fees online
- Get the e-receipt
But then you need to rush to the Sub-Registrar for physical verification. In the office, land ownership gets changed and recorded in the registrar records.
Property Registration Without Buyer
There is a situation where registering the property is either too tiresome or next to impossible. So, you can’t keep your property unregistered as well as are unable to register it. So, you feel it’s preferable to sell it. However, property registration without buyers will be quite difficult for the buyer to think of buying. Isn’t it? So, what shall you do? Let’s look forward to the matter.
As per The Transfer of Property Rights Act, you cannot sell your property if you haven’t registered it in the first place itself. However, there are exceptions allowed. So, don’t worry and keep reading.
In cases like you’re too aged or ill and are unable to get your property registered. In that case, you can sell it without registration. For this, you need to approach the builder and make a request. Your builder needs to make changes in the name of the new buyer. It can transfer the ownership rights to the new buyer.
Yet, in this, the builder’s consent is utmost required. But there’s an extra processing charge levied to the procedure if it’s sold without registration.
Thus, when you interchange the property in the name of someone else, conveyance deeds get levied. Similarly, a sale deed is just another type under the conveyance deed. In it, when you sell your property in the name of another, it gets into account.
Laws Related To Registration Of Property Transactions In India
To make the procedure legalized, smooth, and dispute free, the Indian Government has raised certain laws. It’s related to property registrations. According to Article-246 of the Indian Constitution, the state handles all the matters related to ‘Land.’ Mentioned below are few laws governing property registrations in India-
a. Transfer Of Property Act, 1882
It’s the central act that provides primary principles of property registrations. It includes exchange, mortgage, sale, gift, etc.
b. Indian Easement Act, 1882
It governs the principles relating to the alleviation rights to only immovable properties.
c. Registration Act, 1908 and Indian Stamp Act, 1899
It governs the laws relating to the clearance of stamp duty. It also emphasizes on registration of various deeds, documents, etc.
d. The Indian Contract Act, 1872
It governs the contract procedure in India, including the execution, implementation by the parties. The chapters of the Transfer of Property Act, 1882 that relate to the contract also comes under this.
e. Right To Fair Compensation And Transparency In Land Acquisition, Rehabilitation, and Resettlement Act, 2013
It governs the accession of private lands by the government. There might be certain concrete purposes or rehabilitative measures approved by the government.
f. The Real Estate Act, 2016 (RERA)
It governs the development, sale, and marketing of real estate assignments to secure consumer interests. It ensures
a speedy dispute resolution and makes it mandatory for property registration. The states have adopted the rules and regulations of RERA ensuring an effective final draw.
g. Foreign Exchange Management Act, 1999 (FEMA) and Foreign Direct Investment Policy (FDI)
All the foreign entitled purchase/sale by foreigners comes under this. It governs certain stringent rules for the NRIs to make any property purchase/sale from India.
1. What if I don’t get my property registered?
There are some special cases in which the person is unfortunately handicapped or ailing. In such a case, he cannot move to the Sub-Registrar for the documentation. The Sub-Registrar sends some officers to that person’s house for verification.
2. How much shall I pay as registration charges of my property?
3. How can I save on property registration charges?
Yet, there are few ways how you can keep a check on the property registration charges-
a. Many states offer rebates to the female and the elder section of society. So, you can transfer the property in either of their names and claim your rebate.
b. Prefer buying houses with less number of floors. Higher floors attract more registration fees.
c. If you’re buying a property with a gym, swimming pool, etc., it’ll charge you more. Try not to buy such if you prefer a residential property.
d. If your property is located in an urban spot, you can get more charges. So, if you’re OK with the outskirts, prefer it.
The primary purpose of document registration is recording the execution of the document. The registrar keeps an original copy of the registration document. In case of any property related dispute, you can use it to claim the property.
Property investments are one of the most crucial investments made. The amount of spend is from years’ savings. So, you must make investments only after considering all the factors attached. All the pros and cons, factors, how to save TDS, you must know. This article is a guide book about property registration in India.