Property Registration in India

In simple words, it is the registration of immovable property with the appropriate authorities. As per the law, if any immovable property in India is valued at more than Rs. 100, it should be registered mandatorily as per the Registration Act, 1908. Registration comes into the picture whenever there is a sale or purchase of any immovable property. Once registration is done, stamp duty and applicable fees are paid, new owner’s name is registered in the records of the registrar. Buyers will not be the official owners of a property if it is not registered in their names in government records. In case of dispute, they cannot challenge the ownership in court.

Importance of Property Registration

Property registration is an important step for protecting the rights of the owner of a property. It is a legal process that certifies the ownership of a particular piece of property. In India, it is mandatory to register a property to make it legally valid. Property registration also helps in preventing disputes and conflicts between the co-owners of the property. It also helps in proving the title or ownership of the property in case of any dispute, that we usually witness in India.

By giving legal protection to the owner of the property, it ensures the following:

• Property cannot be sold, mortgaged, or leased without the consent of the owner, avoiding fraud and cheating in property transactions.
• Provides evidence of ownership of the property and helps in settling disputes between two parties.
• Ensures that the title of the property is clear and there are no encumbrances or legal disputes attached to it.
• It also helps in verifying the identity of the owner and makes sure that the property is not being used for any illegal activities.
• All the details about the land ownership can be easily accessed from the sub-registrar’s office.
• Any kind of encroachment by the trespassers can be avoided by showing them the official plan of the land.
• Property owners can avail the benefit under Section 80C of the Income Tax Act
• It also helps in the mutation of the property from one person to other.  

Laws Related to Property Registration

Following are the laws that govern property registration laws in India:

1. Indian Stamp Act, 1899: It is the second most important act for property registration in India. As all documents relating to the transfer of immovable property in India are required to be stamped, this act provides the stamp duty that needs to be calculated and determined by the value of the property being transferred.
2. Indian Registration Act, 1908: This is the most important act for property registration in India, as it deals with the registration of documents relating to the transfer of immovable property in India and sets out the procedure for registering documents with the relevant authorities.
3. Transfer of Property Act, 1882: This Act deals with the transfer of immovable property in India and the conditions under which a transfer of property can take place, and the rights of the parties involved in the transfer.
4. Indian Easements Act, 1882: It states the rights and obligations of parties involved in the transfer of easements. An easement is a right to use another person's property for a certain purpose, for instance, a right of way or a right of passage on that property.
5. Indian Trusts Act, 1882: It deals with the creation and management of trusts in India, stating the rules for the formation of trusts and the rights of the concerned parties involved.
6. Indian Limitation Act, 1963: This Act sets out the period of limitation for filing a suit relating to immovable property in India and prescribes the period of limitation for filing a suit for specific types of immovable property.

New Rules for Property Registration in India

In the year, 2020, a new set of rules for property registration came into effect, which is as follows:

• Due to online registration, copies of all the documents are available on the same day of registration;
• An unregistered property shall not be considered valid evidence in a court of law and shall not have any legal validity;
• No person can claim any benefit under Section 80C of the Income Tax Act if the property is unregistered.

Types of Properties That Can Be Registered

• Land and Buildings: This includes all types of immovable properties such as land, buildings, and other structures attached to it.
• Moveable Properties: This includes movable properties such as vehicles, jewelry, furniture, and other movable assets.
• Intellectual Property Rights: This includes copyrights, patents, trademarks, and other intellectual property rights.
• Shares, Stocks, and Securities: This includes shares and stocks of companies, mutual funds, and other securities.
• Bonds and Debentures: This includes bonds and debentures issued by companies and other entities.
• Wills and Trusts: This includes wills and trusts created by individuals and organizations.
• Leases and Licenses: This includes leases and licenses granted by the government or other entities.
• Bank Accounts: This includes bank accounts, saving accounts, and other accounts held with financial institutions.

Documents Required

When registering land/property, document submission is one of the most crucial steps. Document submission records the execution of documents and one should always register the documents within 4 months from the date of execution. If this limit expires, one can send an application (condonation of delay) to the registrar stating the reason for the delay. The registrar might accept the application, however, a penalty shall be imposed on you.

Usually, 7 days are taken to register a document, but in metropolitan cities, it can be completed within 2 to 3 working days. To avoid any delay, one must keep the following documents ready:  

• Passport-size photographs of buyer and seller
• Identity proof of both parties: Aadhar card, Pan Card
• Latest property register’s card copy
• Power of attorney
• Property Register’s card copy 
• A copy of the municipal tax bill
• NOC (No Objection Certificate) 
• Verified sale deed copy
• Construction completion certificate
• Payment receipt of Stamp duty and registration fee

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Fees and Stamp Duty for Property Registration

Fees for property registration vary from state to state. Usually, the registration fees range between 1 to 3% of the property value, which is capped at Rs. 30,000. One can find the property fees and stamp duty as per the respective state’s stamp act.

Procedure

1. Estimate the value of the property before getting it registered.
2. Hire a Property Registration Lawyer: The first step in registering a property in India is to hire a property registration lawyer, who will help guide you through the process, explain the legal requirements, and help to ensure the process is completed properly.
3. Collect Documents: Various documents will be required to register the property. These may include title deeds, ownership proof, address proof, PAN card, and other documents related to the property.
4. Sale Deed: A sale deed must be prepared by your lawyer before reaching the registrar’s office on stamp paper.
5. Make Payment of Stamp Duty and Registration Fees: Stamp duty and registration fees must be paid at the time of registration, which shall be calculated by looking at the respective state’s stamp duty act and the basis of the value of the property in the market. The stamp duty can be procured online or from a licensed stamp vendor on non-judicial stamp paper.
6. Visit the Sub-Registrar Office: Once all documents are collected and payment is made, visit the sub-registrar office in the city where the property is located. Here, the lawyer can help you to submit the documents and the payment receipt.
7. Verification of Documents: The documents submitted will be verified by the sub-registrar office and if they are found to be valid, the registration process will begin.
8. Registration of Property: After the documents are found valid, the property will be registered in the name of the applicant. At this point, a registration certificate will be issued to the new owner of the property. A receipt is generated after the property is registered which should be kept carefully for future reference.
9. Payment of Property Tax: After the registration is completed, the applicant must pay the applicable property tax to the local authority.
10. Obtaining a Copy of the Registered Document: After the registration is complete, the lawyer will provide the applicant with a copy of the registered document for future reference.

Common Issues

• Incomplete Documentation: One of the most common problems while registering a property in India is incomplete documentation. Many people forget to submit important documents or submit incomplete documents which can lead to delays in the registration process.
• Missing Property Boundaries: Property disputes can lead to delays in the registration process. Before registering a property, it is important to ensure that the boundaries are clearly defined and that there are no overlapping claims.
• Unclear Title Deeds: Another issue that often arises while registering property is unclear title deeds. This can be caused by changes in ownership, inheritance, or even due to a lack of proper documentation.
• Long Waiting Periods: The registration process in India can take a long time, depending on the complexity of the document. This can be a major problem if the registration is urgent.
• Unreasonable Fees: Certain registration fees must be paid to register a property. These fees can vary from state to state, and often seem excessive. This can be a major hindrance for those who are trying to register a property on a budget.

Importance of Hiring a Property Lawyer

Hiring a property lawyer is essential when it comes to real estate transactions. Property lawyers can offer invaluable legal advice throughout the entire process of buying or selling a home. They are knowledgeable in all aspects of property law, including legal issues related to mortgages, contracts, title transfers, zoning regulations, and more. A property lawyer can help protect your interests and make sure that all legal aspects of the transaction are handled properly. A property lawyer also can make sure that all paperwork is in order and that you are making an informed decision. By hiring a property lawyer, you can be sure that all of your legal needs are taken care of and that the transaction is handled in the most efficient way possible. You can find many property lawyers on our Rest the Case platform!

Conclusion

Registration of property is unquestionably a very important procedure to claim the rightful owner of a property. Unregistered property always comes around as a pain to the owners, creating numerous issues in the future. So, it is always advisable to get your property registered.