Buying a property in Bangalore? Here’s the document checklist
February 12th, 2018
Disclaimer: Please be noted that the list below is not exhaustive and be sure to have your legal advisor verify every single document before you make the purchase. The article below is intended only as a reference and awareness material.
Buying a property is anybody’s dream and makes for a very important decision in your life, and hence it is even more important to conduct the due diligence before going ahead with the purchase. Property purchase in India calls for a document-intensive process due to various statutory and legal framework and as a buyer, you might face an exhaustive amount of due diligence, be prepared for that.
To make things a little bit easier, we are providing a checklist on the various documents that need to be in place and verified before you go ahead with the purchase –
Sales Deed(s): This document verifies and confirms to the sale or purchase of property between the parties involved. Depending on the property history there may be more than one sale deed—as many as the number of times the property exchanged hands. Ensure that all the sale deeds are handed over to you before you make the deal. Within the sale deed, the following are things to look for –
- Name of all previous owners to be mentioned clearly and it is important that each sale deed mentions all previous owners of the property.
- Property details such as Location, Khata and Survey numbers, Dimensions, Area, Site particulars, Roads in all directions, etc.
Why Sale Deed: To establish the ownership of property. It is the most important certificate that can also be used for bank loans.
Khata Certificate: This certificate is not the proof of ownership but rather the proof of person paying taxes to the Bruhat Bengaluru Mahanagara Palike (BBMP) or the Bangalore Municipal Authority. Nevertheless, it is important to have the Khata Certificate and have your name registered on the same for it shows your regularity in paying taxes.
Khata Extract: This again, is not a conclusive evidence of property ownership but is an extract taken from the assessment register of BBMP. It contains the list of property owners and tax calculation per year.
Precautionary Measure: It is always good to go for A Khata or BBMP Khata listed property for two reasons—one, it’s safe and free from legal troubles and two, most Public and Private banks will immediately sanction loans for A Khata property.
Encumbrance Certificate: This contains information on transaction on the property, it also has information on monetary liabilities against the property such as mortgages and loans. This provides a clear idea on the status of the property. It is recommended to have the encumbrance certificate listing property transaction for at least the last 15 years. There might be multiple encumbrance certificates based on the duration for which they are obtained from sub-registrar office.
Building plan sanction certificate: This confirms that the Statutory Authority has given permission for the property/building to be constructed in the first place. This proves that the construction is legally authorised.
Joint Development Agreement: In the case where the developer and land owner are two different parties, the Joint Development Agreement is essential. It contains details on the agreement between the land owner and developer who have mutually agreed upon certain conditions under which the construction has been undertaken. This agreement gives clarity of who, between the land owner and developer, has the original title of the property.
Possession Certificate: In the case where the property is developed by a Housing Cooperative Society, it issues a certificate of the possession of the property to the first owner.
No Objection Certificate: In the case where the property is developed by a Housing Cooperative Society, it issues a ‘No Objection’ certificate to the first owner regarding the subsequent sale of the property.
Sales and Construction Agreement: The sale and construction agreement documents are two very essential documents to possess before the purchase. Sale Agreement is a consensual document between the developer and the first owner which contains details of the property such as—possession date, total amount to be paid by the buyer, the intervals and number of instalments of payment, etc. Construction Agreement provides details on the execution of construction work and also involves sale or transfer of goods involved in the execution of the contract.
Power of Attorney: In the case where there is a representative of the original owner who becomes the prime point of contact for property purchase matters, the power of attorney is a legal instrument that certifies the authority given by the original owner to the representative to act on his or her behalf. This helps understand whether the previous purchase or sale was carried out by the original owner or the representative.
BBMP Tax Receipt: The BBMP Tax Receipt has to be the latest and paid showing they are no further dues towards BBMP.
Allotment Letter by Authority: Allotment letter is issued by either the Developer or Housing Society and it contains details—on the description of the property in discussion and on the amount that the money buyer has paid to the Developer/Housing Society. This letter can be produced for availing loans from banks in case of need.
Utility Bills: Bills from BESCOM (Power Authority) and BWSSB (Water Authority) are again, not conclusive proof of ownership of property, but are very useful for other purposes. These bills bear the name of the owner who got the power and water connections done. It is good to have these transferred to your name since they act as relevant address proof and are useful when wanting to avail various government schemes.
As far as Bangalore is concerned, the Bangalore Development Authority approves layout for developments, you may want to check the BDA Link for approved layouts in the city. These days property ID or PID is given by BBMP, you may check the tax receipt for the property ID and use the BBMP link to obtain details of the property and the owner.
Patience is required to obtain and go through each and every document but then, it is absolutely worth the time and effort since this might involve a lifetime of investment for some buyers. Always hire an experienced legal advisor who is updated in terms of the changes in rules and regulations as far as the sale of the property is concerned.