Getting possession of a property is great, but you will not own it as long as you do not register it in your name.
Manoranjan Dey, 72,a resident of a housing society in Mumbai, had put his apartment on sale last August. He wanted to move into a smaller home and thought the surplus cash would help him secure his sunset years further. He negotiated well with a prospective buyer, who was even “ready to pay a premium”, given the well-maintained apartment at a location of his convenience.
However, Dey was in for a shock when he was told that before he could sell the flat he would have to first register it in his name. “I had not paid heed to it since I took possession of the flat in April 1990. When I approached a lawyer who could help me out with the registration process, I was told it would cost me a fortune. And, I am to be blamed for the mess,” says Dey.
Dey is not alone. Even the more financially informed often tend to postpone registration of properties citing lack of money. “In simple words, one must register to obtain ownership that is supported by records maintained with state authorities,” says Vivek Guleria, Head, Legal, Aspire Housing Finance Corporation. In the process, what they fail to understand is that the registration charge and stamp duty is levied on the current valuation of a house and, the more one delays, the burden increases further due to the hefty fine for the delay.
It is also important to note that registering a property is mandatory by law. It not only reduces the risk of fraud and protects you against title disputes, but is also a must during change in ownership. In fact, in a 2011 ruling, the Supreme Court said that all property sales will be considered invalid unless the sale deed was duly stamped and registered.
The most important is the sale deed, or title deed – the property ownership document used for sale and transfer of the property. The documents required to get the registration done includes the receipt of the stamp duty and taxes paid; copy of the sanctioned building plan by a statutory authority; a no objection certificate from the builder, the electricity department, pollution control board and water works department; a copy of the possession letter and the allotment letter from the builder, cooperative society or housing board; the sale agreement between the builder and the first owner; payment receipts and the completion certificate. Once the documents are verified, the deed is drawn up and the registration is complete.
Registration fees are a state subject and vary accordingly. Stamp duty is calculated on the existing circle rate notified by the state authority or the value of the property sold, whichever is higher. In Delhi, for instance, the buyer has to pay stamp duty and transfer duty at 4 per cent of the property price – defined by the existing circle rate – if she is a woman, and at 6 per cent if he is a man. The registration fee is 1 per cent of the total value of the sale deed plus `100 pasting charge. Other charges applicable as per the registration rules of each state vary.
One cannot claim ownership or title in a property till it is registered in his or her name, and the apex court is very clear about this: “In the absence of the deed of conveyance (duly stamped and registered as required by law), no right, title or interest in an immoveable property can be transferred.”
Therefore, you cannot claim or sell a property if it is not registered in your name. “It also stops people to resale such properties to an unsuspecting purchaser and cheat him,” explains Guleria. And of course, the more you delay in registering a property the more expensive it gets.
Several states have started online registration of properties and the moves have made the process transparent and less cumbersome. “There are many merits associated with e-registration of property – it enhances transparency, helps avoid frauds, it is safe, fast and user-friendly. Therefore, online registration is strongly recommended,” says Guleria.
The e-registration process not only allows you to minimise paperwork, but reduces the possibility of falling prey to scamsters in the guise of middlemen. Sample this: instead of queuing up for, say, 20 physical stamp papers of `10,000 each, you can now pay and print a single e-stamp paper worth `2 lakh. All you have to do is to mention the stamp duty amount and property details through a designated issuer like Stock Holding Corporation of India – in the case of Uttar Pradesh – and transfer the amount through RTGS, NEFT or cheque payment.
Online registration can also help you detect flaws or discrepancies during the process, and avoid multiple transactions on the same property. This saves buyers and sellers from wrongs committed by fraudsters. Registration through this mode is faster than the usual mode making it secure as the records made are free from human manipulations. One can easily download and submit the documents.
Now that you have done the hard work and paid a fortune for your dream home, ensure you follow the last leg of the process with equal zeal, and own your dream.