VIOLATION OF BUILDING BYELAWS
Bangalore is one of the fastest growing cities of India. The reasons for such a fast growth could be attributable mainly to the development of I.T. hub, pleasant climatic conditions and better educational and employment opportunities. Because of high influx of people to the city, there is a great demand for house and house sites in Bangalore. This, in turn, has lead to the steep rise in the property values here.
Building byelaws are introduced to regulate construction activities, to prevent construction of buildings in a haphazard manner and to provide better civic amenities. Zoning regulations are also introduced with the same motive and to regulate the land use, control of density of population and to develop the city in an orderly way. However, these building bye-laws and zonal regulations are not strictly followed by the people presumably on the ground that the restrictions imposed are nothing but hindrance in exploitation of the property to the full extent and thereby they construct their buildings at their will. In so doing, they do not mind to forego certain prescribed civic amenities such as having broader roads, playgrounds, parks and other civic amenities.
Broadly, we may classify the violations into three categories viz., violation of Floor Area ratio, violation of site set back and violation of plot coverage. Violation of any one of these three violations would deprive the land owner of completion certificate.
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Floor Area Ratio:
Floor Area Ratio (F.A.R) is prescribed separately for intensely developed area, moderately developed area and sparsely developed area. Earlier, F.A.R. used to be high in more intensely developed central areas in view of land values and lower F.A.R. in the suburbs where land values are less. But presently it is on the reverse pattern and the policy is to fix less F.A.R. in the central area to enable decongestion and higher F.A.R in the suburbs to encourage development where the traffic and other problems are less. Keeping in view the housing needs of people of Bangalore, the present cabinet has decided to revise the FAR upto 4 to enable the land owners to put up more floors on their land vertically than was allowed hitherto. This positive move of the Government would enable construction of more housing units which could accommodate a large number of people.
Non-adherence of sanction plan restrictions and set back:
The building bye-laws prescribe for certain set backs on sides of the building to facilitate the people to have proper light, ventilation, privacy and to save them from dust and traffic noise. While framing the building bye-laws, the civic authorities also keep in mind the future land requirements for broadening roads. It is noticed that people violate building bye-laws by way of additional floor construction, site set back construction, providing stair case on the site set back area, balcony area to be converted into living rooms.
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Land use:
The Zonal Regulations of the Comprehensive Development Plan of Bangalore prescribe different land uses like; residential, commercial, land for civic amenities etc., for systematic development of the locality. But, it is noticed that the residential buildings situated along the main roads and the roads nearer to commercial area are developed and utilized as commercial property. Even several industries also do crop up in these localities in gross violation of zonal regulations. Similarly, residential or commercial buildings do crop up in civic amenities sites meant for parks, play grounds, schools, green belt areas etc.
Sanction Plan for additional constructions:
If a part of the building is constructed with deviations, the owners of such property hesitate to approach the plan sanctioning authorities whenever they intend to put up further construction on the property for approval of sanction plans for the reason that deviations will be noticed during inspection by these authorities and thereby proceed to make further construction without the sanction plan. Such people try to develop rapport with the concerned municipal authorities and put up additional constructions without sanction plan.
The reason for violation of building bye-laws and sanction plans by the people is that most of the land owners/builders want to exploit their land to an optimum extent because the residential and commercial properties do fetch high return. Presently, in Bangalore there is a steep rise in land value, say Rs.5,000/- per sq.ft. on an average.
In a large number of cases, deviations and violations take place with the active support of the officials and the local politicians. Only in rare cases when it is brought to the notice of the competent authority of deviations, action would be initiated by the concerned authorities against which action the land owners knock the doors of the courts and in many such cases courts do grant stay. Thereupon, the building owners do enjoy the property for long period despite violation of the bye-laws since it would take long time for the court to dispose of the matter.
Remedies
Violation of bye-laws, deviations of sanction plan, zonal regulations etc., cannot be allowed to be continued for long since it is an unhealthy trend. Therefore, the following suggestions may help in curbing violations of the bye-laws etc.
User friendly bye laws:
The building byelaws and zonal regulations of the Comprehensive Development Plan should be user friendly and acceptable to the majority of the public. Further, the byelaws should not consist of too many technical jargons but should be simple to enable the common man to understand and follow. Byelaws should be suitable to the local conditions failing which there would be violation of such laws.
Strict enforcement:
When once user friendly building byelaws with simplified procedure for sanction of building plans are introduced, there should be deterrent punishment if the property owners deliberately deviate from the sanctioned plan or construct their buildings without the sanction of the competent authority. It may be kept in mind that unless strict enforcement of the zonal regulations and building bye-laws is carried out in letter and spirit, there is every likelihood of people violating even the user friendly byelaws.
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THE RISKS IN INVESTING IN UNAUTHORIZED LAYOUTS
In recent times, Bangalore has witnessed phenomenal growth in population due to various reasons such as pleasant weather conditions, better career opportunities and the like.
As a result of this, there has been a rapid increase in the demand for house and house-sites here. In order to cater to this increasing demand, a large number of Developers and Property Dealers have come into picture and have been forming private layouts without following the mandatory procedure and requirement of law making the innocent purchasers to suffer.
To avert this mishap, it is necessary that the intending purchasers of immovable property in Bangalore to have some knowledge about the nature of the property proposed to be purchased by them to save themselves from the risk of investing in the immovable property with no valid and marketable title.
Authorities
There are only two authorities, which have been authorized to approve layouts in and around Bangalore viz., Bangalore Development Authority [B.D.A.] and Bangalore Metropolitan Rural Development Authority [B.M.R.D.A].
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Bangalore
While the BDA approves the layout plans for formation of layouts in the lands falling within the metropolitan areas, BMRDA approves layout plans for formation of layout in the lands situated in the outskirts of Bangalore.
Getting approval for the land conversion and layout formation from BMRDA is less time consuming, less expensive and easier when compared to procedure laid down by the BDA.
Development Plan
For planned development of a city, proper road network, parks, open space, civic amenities, and a proper approved layout is necessary. BDA is the authority in charge of planning and development to Bangalore Metropolitan Area. Comprehensive Development Plan [CDP] is prepared by BDA under the Karnataka Town and Country Planning Act, 1961.
The last CDP was prepared and approved by Government in the year 1995, which is still in force.
Zonal Regulations
In order to promote public health, safety and the general well-being of the community, it is necessary to apply reasonable limitations on the use of land and buildings.
This is to ensure that the development of the city takes place in accordance with the land use plan as proposed in the CDP in a most appropriate and healthy manner.
Generally, CDP is valid for a period of 20 years from the date of preparation of the plan. The following are the classification of land uses for various zones:
1. Residential
2. Commercial (retail and whole sale business)
3. Industrial (light and service industries, medium industries and heavy industries)
4. Public and Semi-public Utilities and Services.
5. Parks and Open space and playgrounds (including public recreational area)
6. Transportation and Communication.
7. Green-belt area
Unauthorised Layouts
Sites formed in unauthorized layouts are called Revenue Sites. The lay-outs which are formed without following the mandatory procedure and the requirements of law are called unauthorized layouts and can be classified into two:.
Converted land
In this type of layouts, sites are formed in the lands which are converted from agricultural to non-agricultural residential purpose after obtaining conversion order from the Deputy Commissioner and in conformity with the zonal regulations but without obtaining approved layout plan from the competent authority. Village Panchayats are not competent to approve the lay-out plans.
Agricultural land
In these layouts, sites are formed on the agricultural lands not converted and without obtaining approved layout plan from the competent authority. Purchase of this type of site is very risky as marketable title would not be available to the purchaser.
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Sites formed in either of the classification referred to above are called as revenue sites. In such sites, electricity, water, sanitation and civil amenities will not be available to the site owners though providing of these facilities are the mandatory requirements as envisaged under the Karnataka Town Planning Act, 1961.
In formation of sites in these unauthorized layouts, Developers play a key role. In order to achieve maximum saleable area, the width of the road and the space allotted for providing civic amenities would not be as per law.
The only intention of the developers in such unauthorized layouts would be to enrich themselves without providing even the basic amenities to the buyers.
Purchasing sites formed in the converted land unauthorized layout is comparatively a better option to the one formed in the non-converted agricultural land. However, purchasing sites in unauthorized layouts will not convey valid and marketable title to the transferees.
In fact, Bankers even refuse to provide loans for such sites either for the purchase or for putting up construction thereon. Thus, sites in unauthorized layouts are not recommended for purchase.
Approved Layouts
It is advised that the people who are desirous of purchasing house site may prefer to purchase sites in approved layouts for the reason that water supply, underground drainage, street lights, electricity supply, civic amenities are available in these layouts.
Valid and marketable title are conveyed to the purchasers. Value of sites appreciate considerably. Housing loan facilities can be availed for purchase of site and for construction and above all it is easy to dispose of these sites whenever needed. The following types of sites are suggested for purchase:
1. Sites allotted by BDA without lease.
2. Sites allotted by KHB without lease.
3. Sites allotted by Co-operative societies after obtaining approval for formation of layout from BDA or BMRDA along with order of release of sites.
4. Sites formed in the private layout, approved by BDA or BMRDA along with order of release of sites.
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Selvakumar Bangalore
Bangalore
PERILS OF BUYING THE REVENUE SITES
Agricultural land cannot be directly put to use for residential purpose. It needs to be converted by paying conversion charges. The Special Deputy Commissioner is the competent authority to grant permission for conversion of agricultural land for non-agricultural purpose.
Revenue site is one that is situated in the layout formed on the agricultural land for a non-agricultural purpose without proper approval under the relevant law i.e., Karnataka Land Reforms Act, Karnataka Land Revenue Rules and other provisions of law.
No building can be constructed on agricultural land without obtaining conversion orders, layout and building plan approvals from the concerned authorities. Residential layouts can be formed only in the residentially converted land, such a land should be in the residential zone as per the zonal regulations for getting the conversion for residential purpose. The Village Panchayath is not the competent authority to approve the layout plans.
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Zonal Regulations:
As per zonal regulations of the comprehensive development plan, green belt area is meant only for agricultural activities. Non converted land continues to be agricultural land and there are various restrictions on sale and purchase of agricultural land. In Bangalore Urban Agglomeration, Bangalore Development Authority (BDA) is the competent authority to approve layouts and to get this approval road width, residential area, civic and other amenities are to be provided as per law. The Bangalore Metropolitan Regional Development Authority (BMRDA) is the regulating authority to approve layouts on the outskirts of the Bangalore.
All around Bangalore, it is a very common practice for people to buy a piece of agricultural land, which is more popularly known as “revenue site”, without being aware of the hassles involved in buying such sites. Sites such as those formed in the agricultural land without getting the layout approved by the competent authority are generally referred to as "Revenue Sites". Small time promoters misguide the buyers and motivate them to buy the revenue sites even by concealing the vital defects and flaws in the title of the owner. In addition, there are several instances wherein the land would have been notified for acquisition by certain statutory authority or even the land on which sites are formed may be grant land for schedule caste or schedule tribe people wherein obtaining prior approval of the competent authority for change of land use and for sale is necessary. Ultimately, it is the innocent purchaser who faces the legal battle after purchase of revenue sites.
Middlemen rule
Generally, a nominal sum is paid by the Small Time Promoter as a token advance to the landlord and a general power of attorney is obtained; and thereafter, search for the innocent purchasers begins. The middle men, like double edged razors, hike the price of the land and at the same time, do not properly settle the accounts with the illiterate and ignorant land owners.
These Small Time Promoters form layouts on agricultural lands without approval of the layout from the competent authority. To increase the saleable area of the “sites”, they provide narrow roads. These layouts generally do not have civic amenities and other facilities, since the promoters generally do not have any intention of providing them.
Marketing Strategy:
The Small Time Promoters know the art of marketing. They make colorful brochures with photographs of certain parts of Bangalore and paint an attractive picture to attract the people to buy sites in these layouts. Some of them even download foreign photographs of houses from internet for their brochures. Better the presentation, deeper the deceit, which very few people understand. After the Small Time Promoter has got his money, the purchaser will have the bitter experience.
These promoters/agents in league with brokers will register some imaginary sites at the sub-registrar’s office using their clout. There are many instances where the lands bearing Khaneshumari number without any link to the old survey number are being registered in the Sub-Registrar's office by the Owners in connivance with the Brokers either by creating or manipulating the existing documents since it is not the duty of the Sub-Registrar to verify the legality of the documents.
Ancestral Property
In the recital of a sale deed, it is customary to mention how the seller has acquired his title, interests and rights to the immovable property from origin to the end. In the case of revenue sites, the brokers at the office of various sub-registrars have devised a very ingenious method to hide out this fact. They merely mention in the recital that the property is the “ancestral property” of the seller. In this way, the brokers pass on the defective title of the property to the innocent purchasers.
There are several instances where the land notified for acquisition and the land granted for schedule caste people have been made into sites, where the purchaser of such a site would not get title of the property.
GPA transaction
Generally, brokers will take GPA from the landowner for the entire land. Most of the revenue sites are registered on the strength of GPA. Only a very few people take care to check up the legality of the GPA executed by the original vendor. Nobody bothers to find out whether the GPA is registered or not, and whether the executor of the GPA is alive or not.
If the executor of the GPA is not alive the GPA transaction is totally invalid. A Joint GPA executed by two or more owners would become invalid if any one of them dies.
Form 9 and 10
Originally, property falling under the village Panchayath area alone has the genuine site status. Form No.10 is for a house situated within Gramathana area and Form No.9 is for a vacant site situated within Gramathana area. Middlemen and some revenue officials make bogus Forms No.9 and 10 and register immoveable properties in favour of innocent purchasers.
When the Urban Land Ceiling Act was in force, thousands of revenue sites were registered by merely mentioning in the sale deed the description as one square asbestos sheet house. This was mentioned just to avoid getting the relevant clearance under the said Act. After the Urban Land Ceiling Act was abolished the term one square asbestos sheet house was also removed from the real estate agents’ dictionary.
It is not legal to form layouts and sell sites in the agricultural land/green belt area, even after selling all the sites; RTC (Record of Rights, Tenancy and Crop Inspection) will be in name of the original landowner.
The Agent being a GPA holder will sell the sites, as “ancestral properties” to the innocent purchaser. The numbers assigned to these sites will never match with the survey numbers assigned to these lands by the government. The purchaser of the revenue site doesn’t get the title of the property. What is purchased is an imaginary site only. If, however, the original owner is good then the purchaser can enjoy the property, till the government regularizes such revenue sites.
Loan clearance
If the title deeds are not clear and does not establish marketable title, it is difficult to obtain bank loans for construction by mortgaging these sites. Generally, these sites are situated on the city outskirts. There will be no proper roads, electricity or water supply. There is no scope for immediate development of the locality. With all this, if the prices of the sites appreciate over a period of years, the original landowner will appear from nowhere and start cultivating the area.
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He will remove all the boundary stones laid by the broker/small time promoter making it difficult for the purchaser to identify his property. In certain cases the GPA holder sells the same site to several persons and collects money from all of them. Consequently, marathon litigation awaits the purchaser. The laws are so complex that they give rise to multiple interpretations.
In recent times, litigations pertaining to property transactions are increasing. Common problems involved are that the property might have been sold by one of the Co-owners without arraying the other Co-owners as parties to the sale. After the death of the person who sold the property, his Legal heirs/representatives and the surviving co-owners with an intention to take advantage of the rising prices for their property may approach courts with suits.
The buyers may, therefore, consult a legal expert in property matters before investing their hard earned money.
RISK IN PURCHASE OF PROPERTIES SITUATED IN VILLAGE
Generally, BDA and BMRDA sites are having good title and constructing house on such sites would be easy and hassle-free. These sites do have proper water, electricity and other civil amenities. However, in view of the fast growth of the city, these infrastructural facilities lag behind the demand of the citizens.
To get sites allotted from BDA is not an easy task and people have to wait for long time to get a site allotted from them. Therefore, people who intend to have shelter of their own, purchase village Panchayat sites either in the form of revenue site or converted site without approval of the layout. In and around Bangalore more than 5 lakh village panchayat sites are owned by the middle class and lower income group people.
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Advocate Selvakumar
Advocate Bangalore
Selvakumar Bangalore
Bangalore
Revenue Site
A Revenue site is one that is situated in the layout formed on the agricultural land for a non-agricultural purpose, without proper approval under the relevant law i.e., Karnataka Land Reforms Act, Karnataka Land Revenue Rules and other provisions of law.
All around Bangalore it is common practice for the people to buy sites formed on agricultural lands in unapproved layouts, generally referred to as “Revenue Sites, unaware of the hassles involved in buying such sites. Small-time promoters / brokers misguide the buyers and attract them into buying such revenue sites.
As per zonal regulations of the comprehensive development plan, a green belt area is meant only for agricultural activities. Non-converted land continues to be agricultural land and there are various restrictions on sale and purchase of agricultural land. In Bangalore Urban Agglomeration, Bangalore Development Authority (BDA) is the competent authority to approve layouts where road width, residential area, civic and other amenities have to be provided as per law. The Bangalore Metropolitan Regional Development Authority (BMRDA) is the regulating authority to approve layouts on the outskirts of Bangalore.
Imaginary site
Small-time promoters who want to make easy money are forming layouts on agricultural lands and are marketing these revenue sites to the intending purchasers through their agents. The modus-operandi adopted by them involves hatching manoeuvres with panchayat officials and in connivance with sub-registrars’ officials to create imaginary site documents. These promoters / brokers misguide buyers and attract them to buy sites formed on the agricultural lands.
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It is not legal to form layouts and sell sites in the agricultural land falling under green belt or other areas situated around Bangalore. Even after formation of layouts and sale of such sites, RTC (Record of Rights, Tenancy and Crop Inspection) will remain in the name of the original landowner. The numbers assigned to the sites in these layouts would never match with the survey numbers assigned by the Survey Department. The purchaser of the revenue site doesn’t get the title and also cannot exactly locate the site. What is purchased in these layouts is only an imaginary site. After selling such revenue sites the original land owners may sell the same property to someone else at a later date as agricultural land, which is a legally valid transaction that is happening all around Bangalore.
Revenue sites having Khaneshumari number without any link to the old survey number are being registered in the Sub-Registrars’ office by the owners in alliance with the brokers either by creating or manipulating the documents. Some unscrupulous persons at the entrance of the sub-registrar’s office make bogus form No: 9 & 10 and 1 & 12 and deceive the innocent purchasers.
Modus Operandi
Generally, brokers will take GPA from the landowners for the entire land. Most of the revenue sites are registered on the strength of GPA. Only a very few people take care to check up the legality of the GPA executed by the original vendor. Nobody bothers to find out whether the GPA is registered or not, and whether the executor of the GPA is alive or not.
If the executor of the GPA is not alive, any transaction entered into after his death on the basis of such GPA is totally invalid. A joint GPA executed by two or more owners would become invalid if any one of them dies. Property falling under the village panchayat area alone has the genuine site status.
Misleading Statements
In the recital of a sale deed, it is customary to mention how the seller has acquired his title, interest and rights to the immovable property from origin to the end. In the case of revenue sites, the brokers at the office of various sub-registrars have devised a very ingenious method to hide this fact. They merely mention in the recital that the property is the ancestral property of the seller. In this way, the brokers pass on the defective title of the property to the innocent purchasers.
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No layout can be formed on land for which final acquisition notifications are issued and the free grant lands belonging to schedule caste and schedule tribes community. However, there are instances where the small time developers form layouts on these lands as well. Any purchase of site formed on such lands would not provide any good title to the purchaser and such lands would vest back in the original allottee or in the government as the case may be. Therefore, every precaution needs to be taken while making purchase of sites formed on the lands situated in village panchayat limits.
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OWNERSHIP OF IMMOVABLE PROPERTY
Before understanding the terminology of ‘Ownership of Immovable Property’ it is necessary to understand what an immovable property is. In common parlance immovable property means land, buildings and things which are permanently attached to the land.
According to Section 2(gg) of the Karnataka Stamp Act,1957 “immovable property” includes land, buildings, right to ways, air rights, development rights, whether transferable or not, benefits to arise out of land and things attached to the earth or permanently fastened to anything attached to the earth. The Transfer of Property Act, 1882, does not define the word ‘immovable property’ in detail, but only mentions that immovable property does not include standing timber, growing crops or grass. According to The Karnataka General Clauses Act, 1899 immovable property shall include land, benefits to arise out of the land and things attached to the earth or permanently fastened to anything attached to the earth. The words “attached to the earth” has been elaborately described in Sec.3 of the Transfer of Property Act. According to this section, attached to the earth means --
1. Rooted in the earth as in case of trees and shrubs;
2. Imbedded in the earth as in case of walls or buildings or
3. Attached to what is so imbedded for permanent beneficial enjoyment of that to which it is attached.
OWNERSHIP:
Let us now understand something about ownership. Ownership can be broadly classified into two – absolute ownership and restrictive ownership. The ownership is an amalgam of rights, interest and title which is recognised under law. The word absolute ownership is a bundle of rights connected to some specified property. The word right has a wide meaning. It gives powers to the person said to have rights to do something or act, or not to do such thing or act, in relation to his property. Rights are of different types such as Right in Rem, Right in Personam etc. “Right in Rem”. is available against the whole world while the “Right in Personam”, is available against a specified person, or group or group of persons. The owner of any property has a legal right which is recognised under the laws of the land. It consists of following rights which are only illustrative and not exhaustive:
1. Right of Possession and occupation.
2. Right to use and enjoy his property without undue interference from outsiders.
3. Right of alienation of his property as provided under law in favour of any person/s without any restrictions by way of sale, gift, transfer by Will, and by creation of trust..
4. Right to make alteration to the property/structure, consume, destroy, repair, reconstruct, hypothecate, mortgage, lease and to use the property as security to borrow funds.
These rights are rights in rem available against the whole world subject to the restrictions imposed under various laws like Land Reforms Act, Land Revenue Act, Town Planning Act etc.
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RESTRICTIVE OWNERSHIP:
Apart from absolute ownership, there are other types of ownerships which are restrictive in nature. In restrictive ownership, certain rights detailed under absolute ownership are restricted or not available for certain specified period.
CO-OWNERSHIP:
Under co-ownership, there will be more than one person who jointly own the same property. Both the persons have equal or certain percentage of rights to possess and enjoy the property as agreed to between them. In the case of co-ownership, the owners own the whole property jointly and thereby their respective shares are not physically ascertainable with definite measurement and boundaries. The shares are undivided. For example, in case four persons own a property of 1200 sft, each of them would be entitled to 300 sft.of undivided share in this property. This 300 sft of undivided share of property could be any part of the building/property and cannot be confined to a specific part. Share of the co-owners in the property need not necessarily be equal. It depends on their investment in the property as detailed in the purchase document. In the absence of any such details as to the share of investment made for acquisition of property it is presumed in law, that all the co-owners have equal undivided share of interest, right and title in the property as per section 45 of Transfer of Property Act. It is always advisable to clearly mention the share of investment of each co-owner in the property and their undivided share in right, interest, title in the property for the purpose of alienation, inheritance and taxation.The Co-owners share in the property is inheritable and transferable. The concept of this co-ownership is often termed as “Tenants in common” in legal parlance. Practically, it is not possible to identify or divide a property held jointly by metes and bounds. Thus, the co-owners possess and enjoy the property in unison.
Dual ownership:
Many owners of land, lease the property to others on long lease. The terms of lease also gives right to the lessee to construct buildings and enjoy the benefits of such buildings on leased lands. This practice has led to dual ownership of land and building. The land is owned by one person and the structures thereon is owned by another person. The terms of lease also stipulate, whether the ownership of the building will get transferred to the lessor or the owner of the land, free of cost on expiration of the lease period or has to pay for acquisition of such structures. The Income Tax Act recognises the dual ownership concept and the owner of the building is taxed for the income received from the property.
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The transfer of Property Act 1882 deals with various kinds of transfer of immovable property, which include sale, mortgage, lease,
exchange etc. In sale of an immovable property there are generally two
parties to the said transaction i.e. the Seller/Vendor and the
Buyer/Purchaser. Section 55 of the Act refers to the rights and
obligations of the seller and purchaser of an immovable property.
Obligations of the seller are:
1. To disclose any material defect in the property of seller and title to the buyer.
2. To produce the documents of title for the verifications of the buyer on his request.
3. To answer all relevant questions of the buyer.
4. To execute proper conveyance deed on full payment of the consideration.
5. To take care of the property and the documents in the period between
agreement to sell and handing over the possession of the property after
execution and registration of Deed of sale.
6. To give possession of the property.
7. To pay all taxes, charges, rents upto date and discharge any
encumbrance on property prior to the conveyance of the property.
The seller has some rights; they are:
1. To receive the rents and profits of the property till its ownership absolutely passes on to the purchaser.
2. Where the ownership has passed on to the purchaser before payment of
full sale consideration, the seller will have a charge on the property
for the amount of purchase money and interest on such amounts.
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Obligations of the buyer are:
1. To inform the seller any fact which may increase the value.
2. To pay the consideration amount to the seller as agreed.
3. Where the ownership has passed on to the purchaser, to bear the loss
on account of destruction, increase or decrease in the value of the
property not caused by seller.
4. To pay all taxes, charges, rents etc. where the ownership has passed.
5. The purchaser may retain the amount of any un-cleared encumbrance, out of consideration amount payable.
The purchaser is entitled to the following rights:
1. Where the ownership has passed on to the purchaser any benefit of any
improvement increase in the value of the property, rents, profits.
2. A charge on the property as against seller and all persons claiming
under him for the amounts paid by the purchaser with interest.
The above referred rights and obligations of both the seller and
purchaser are binding on both. But the section 55 of Transfer of Property Act provides an exemption. If the parties to the deal have any
contract contrary to the rights and obligations as envisaged in the Act,
the contracted obligations and rights prevail to that extent.
The obligations and rights have relevance only where there is a valid binding contract of sale between the parties.
Incase, the purchaser of property declines to accept the possession of
the property, he has charge on the property with regard to earnest money
paid and any costs awarded to him of a suit.
The rights of the purchaser is subject to certain limitations. These
rights are applicable as long as the matter is in the stage of agreement
and when the deal is finalized, conveyance deed is executed; the deal
will come to an end.
But the case is different where the conveyance is brought on account of fraud practiced by the vendor.
It is also necessary that the purchaser shall avail himself of
knowledge or means of knowledge open to him or his agents to verify the
credentials of the vendor, his interest, title to the property. He has
to exercise due care and diligence by exercising reasonable care and
then only the purchaser can claim the protections of law for any
mischief played on him.
Property advocates
Advocate Selvakumar
Advocate Bangalore
Selvakumar Bangalore
NORMS OF PUBLIC NOTICE FOR PURCHASE OF PROPERTY
Readers of newspapers normally come across notices published regarding purchase of immovable properties. Let us analyze and understand the basis and scope of such notices.
Property advocates
Advocate Selvakumar
Advocate Bangalore
Selvakumar Bangalore
Bangalore
Every purchaser of immovable property has to exercise proper care and diligence to ensure that the property to be purchased by him is free from encumbrance, charge, and lispendens. Any failure on the part of purchaser to know whether the property is encumbered or free from encumbrance would land him in problem. Section 55 of Transfer of Property Act,1882 makes it mandatory that the seller is bound to disclose all material defects in the property or in his title thereto, which the seller is aware of and the purchaser is unaware. The seller is obliged to disclose all such information which the buyer cannot discover with ordinary care and prudence. Therefore, the buyer should verify, search and utilize all the avenues available to ascertain whether the property intended to be purchased is free from encumbrance.
Deemed Notice:
The Transfer of property Act puts some onus on purchaser and in certain cases, the purchaser is deemed to have notice of some encumbrance. Section 3 of Transfer of Property Act defines the notice. “A person is said to have notice of a fact, when he actually knows the fact, but also when he should have known the fact by diligence search, enquiries without gross negligence”. The Section explains that when registration of a document concerning any transaction of an immovable property is mandatory and accordingly the document has been registered, any person acquiring such property or any part thereof or any share or interest in the said property shall be deemed to have information of the registered document. The Section further states that if any person is in actual possession of the property agreed to be purchased, the purchaser is deemed to have notice of encumbrance. Even if the agent of the purchaser acting on behalf of purchaser has the knowledge of any encumbrance on the property, the purchaser is deemed to have such notice.
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Selvakumar
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Buying a property in Bangalore
Types of Notices:
There are three kinds of notices:
1. Actual notice when a person has the knowledge of actual fact.
2. Constructive notice where the information is available on proper enquiry and search.
3. Notice to the agent of the purchaser, where the information is given or received by the agent in the course of his ordinary duties, whether he communicates it to his principal or not. Notice to the active partner of a firm has the effect of notice to the firm.
Purchaser’s Obligation:
Most of the encumbrance may be discovered by verification of records at jurisdictional Sub-registrar’s offices and from such other relevant documents. It is obligatory on the part of all purchaser to verify the title as recorded in registers of jurisdictional Sub-registrar’s office and any omission to exercise this will amount to negligence. Just relying on encumbrance certificate issued by registering authority is not enough. Registration of a document operates as a notice.
As mentioned above, actual possession of property by a person other than the seller also operates as notices of title. So the purchaser should invariably inspect the property and ascertain that it is in possession of the seller or the occupant will vacate the property before registration and the seller has every right to get it vacated. There are various instances, where properties are leased, but lease deeds are not registered. Specific Relief Act 1963, under Section 19 also recognizes ‘possession’ as a notice.
It is the duty of the purchaser to make out a clear marketable title of the property. The advocate of the purchaser has to find out from various sources as to whether there are any pending litigations. Proper enquires should also be made as to the claims of dependants under Hindu Adoption and Maintenance Act 1956.
Public Notice:
After exhausting all the means referred to above, the purchasers should also give a public notice of his intention to purchase the property and call for any objections from persons having claim over the property. There may be subsisting encumbrance, which are not registered and which cannot be discovered like prior agreement to sell. Therefore, issue of a public notice would help the purchaser to a certain extent to know the existence of prior encumbrance, if any. The purchaser may publish the notice generally after sale agreement is executed. The notice has to be published in two dailies one in English and another in the vernacular language, which have wide circulation in the area where the property is situated.
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