A property is divided into movable and immovable property. The
base definition of an immovable property as defined in The General
Clauses Act, 1897 U/S. 3(26), "Immovable property" shall
include land, benefits to arise out of land, and things attached to
the earth, or permanently fastened to anything attached to the
earth." An immovable property is also defined in various other
acts like Transfer Of Property Act,1882, Registration Act, 1908,
The Income Tax Act, 1961 etc.
Herein we shall deal with investigation of title required for
various purposes including but not restricted to sale, but also for
lease, sublease, mortgage. For the purpose of brevity the reference
of sale shall also mean to include purposes of lease, sublease,
license, mortgage where applicable.
Title is a legal term; it means the ownership right to property.
Title of property is the prime concern of everyone at the time of
purchasing of a property. Every property has a title. Title is the
evidence of the right of ownership or the ground of right of
ownership. Title can be created by act of parties or by operation
of law. Title is acquired by transfer or by operation of law .The
law relating to transfer of immovable property is governed by the
Transfer of Property Act .Two other Acts closely connected to it
are the Indian Registration Act and the Indian Stamp Act. Law of
Contract, and the various Statutes passed by State Legislatures
from time to time have important bearing in the matter of
ascertaining title to immovable property. Law relating to
succession is another important area connected to investigation of
title.
Title to immovable property is ascertained by perusing relevant
"Documents" and "Deeds" pertaining to such
property. The term "Document" has very wide import. Under
general law 'document' means any matter expressed or
described up on any substance by means of letters, figures or mark
for the purpose of recording that matter. The documents relating to
property or commercial transactions are generally called
Instruments or Deeds.
Investigation of title is very essential since the ownership of
the property is required to be complete, fair & free from any
doubts, risks & interest. To ensure this an investigation is
much needed so that a purchaser can take all necessary steps at the
time of acquiring property to obtain a good & clear title of
the land. When search is conducted unto the property of the person
who owns it, it is called the Investigation of Title. It is also
popularly called as 'SEARCH' into the ownership of the
property. The investigation is carried out broadly to ensure that
the property is indeed in the name of the person selling, is free
from liens, mortgages and encumbrances, that the property tax has
been fully paid up to date and that the property is not engaged in
any legal conflicts
The investigation of title is a step as towards an agreement of
sale. An agreement of sale has three main step preceding the
completion of a transaction of sale they are: - (1) Settlement of
the terms of the deal between the parties particularly relating to
the consideration & the property to be transferred, (2)
Preparation and execution of the agreement & (3) Investigation
of title of the transfer of property.
The object of investigations of title is to ascertain the
ownership and title of a given property, in most cases immovable in
nature. The attributes of ownership are , (1)right to have and to
get possession ; (2) right to prevent interference by others ; (3)
Power of alienation (4) liberty of using the object according to
owner's will ;(5)liberty of enjoying the fruits and to avail of
the object owned ;(6) liberty of changing its form and even
destroying it. The origin of ownership is in possession: Actual
possession implies a right to retain it until the contrary is
proved and to that extent possessor is presumed to be the owner
.The concept of ownership gave birth to "title" and the
idea of title as the better right to obtain or retain possession
evolved through trover and detenue. A person, who would succeed in
establishing a better right to have possession than the other,
would be the owner. All titles to land are ultimately based on
possession. This is the position in English law as well as Indian
law. There is a dictum, which says that so far as land is
concerned, there is no law of ownership but only a law of
possession. Person can have control over land only if he is
directly in contact with the land. In other words person can
control over the land if the land is under his possession. It
directly means word "possession" and word
"ownership" goes together. Possession is most important
component of the ownership. If owner is not in touch with land and
somebody else is having control over the land, under the
circumstances owner loses his ownership. There are legal provisions
for granting ownership to the person having control on land for
long period
Investigation of title is an intricate matter. There is no
standard period prescribed for the root of title. After the
execution of the agreement of sale it will be the duty of the
vendor's advocate to send to the purchasers advocate the title
deeds of the property. These title deeds are sent in exchange of an
accountable receipt to be signed by the purchasers advocate. The
purchaser advocate signs the accountable receipt and keeps a copy
thereof with him with the title deeds. Investigation of title
starts with the present owner's original title deed which will
always be 'the document of title 'to the property. Once the
original deed is perused the investigator proceeds to verify the
parent documents or the prior title deeds The work then of
investigation of title by the purchasers advocate commences He will
than take searches in the office of the sub-registrar to find out
all the documents relating to the property which is the subject
matter of sale which are registered.. To what extent and up to what
period the prior title deeds are to be perused vary from case to
case. The safest thing is to peruse the title deeds for the last 30
yeas. The reasons for this proposition are; (1) the period of
Limitation against Government is 30 years; (2). Under Section 90 of
the Evidence Act , a document 30 years or more are presumed to be
validly executed.(3) The contents of any document are presumed to
represent the correct agreement or understanding between the
parties there to .However a search for the last 12 years is treated
as normally sufficient . If the title cannot be reasonably be
ascertained with in 12 years, then it is necessary to go back as
much as necessary. In addition to ascertaining the owner's
title, it is the duty of the investigator to rule out the
possibility of any subsisting charge by way of equitable mortgage
on the property under investigation. For this, perusal of all
original title deeds for the last 12 years or even more may become
necessary.
In Maharashtra to check the title verification of the property the
investigator must do the following checks: - a) Recent 7/12 Extract
( 7-12 Utara) :- It will give idea about the type of ownership,
total number owners ( and their share in property) of the property.
Loan on the property, tenant in the property ( if any), cultivable
and non cultivable area in the property, source of irrigation ( if
any), assessment for the property, Class of the property,
Reservation on property( if any). b) All mutations on 7/12 extract
( Ferfar ):- Mutations are the entries made by the revenue
department in respect of any change in ownership of the property,
such changes may be because of death of any owner, Loan obtained by
any owner etc some time it may happen that name of any person
appears in Mutation but not in 7/12 extract, to check such things
it is advisable to check all mutations, c) Maps :- it is advisable
to check maps provided by the government authorities, this gives
better idea about he exact location of the property and access to
the property, d) Ceiling Limit :- As per the type of the property
there is a Limit provided for the holding of the Land , the
purchase must check that the Land which he is going to purchase
will not cross his limit as well as he have to check that the
vendor is also not holding it as excess land. The Khate Utara (8 A
Extract) is a document which gives us idea about the exact holding
of the owner, e) 6c Certificate ( Varas Register ) :- 6c
Certificate is a document which gives us idea about the names of
all Legal Heirs of deceased person. This document is very important
as, it is noticed that some times names of Female Legal Heirs are
not appearing on revenue documents, to avoid such ambiguities it is
advisable to check 6c Certificate
Lis Pendens if any, recorded U/S.52 of the T.P. Act should also be
verified with the District Sub- Registrar. It would also be
necessary to take search in the office of the collector of the
relevant records and it would give the buyer's advocate the
title to the property and show how title has devolved. No doubt
should be left unanswered and nothing should be taken for granted
where a continuity link is broken and without satisfactory
explanation forthcoming therefore.
Some transactions are un-registered to check such transaction it
is advisable to the purchaser to Publish notice at least in two
Local News paper and ask for objections this helps the purchaser
advocate to satisfy him self about the title of the property.
Claims are invited in the nature of mortgage, lien, charge, lease,
easement, gift, trust, or any other claim against the property
which is required to be notified to the buyers advocate within a
period of 15days after which it shall be deemed to have been
waived. Such Public Notice supports the buyer's contention in
the case of dispute that he is a bonafide purchaser for value
without notice of any claim.
An Enquiry in Bombay Municipal Corporation (BMC) is necessary(if
applicable). It must be inquired whether there are any claims to
the property concerned. A letter to be addressed to the Assessor
and Collector, BMC, to find out whether there are any arrears of
municipal bills or water charges or riot bills in respect of the
property agreed to be purchased by the buyer. An Enquiry with the
Ward Officer must be made with the Ward Officer in which the
property is situated to find out (1) whether the property or any
portion thereof has been notified under the Land Acquisition Act
for public purpose or (2) Whether any notice, notification, action
or claim is pending against the property. (3) Whether any portion
of the property is included in the setback and (4) whether there is
any notice pending against the said property.
An enquiry is also to be made in CRZ and other zones as it is not
allowed to any development in such zones it is necessary for the
purchaser to check such zones before signing any deed. The
purchaser also satisfy himself that the seller is not going to
become a Land-less person after said purchase of land.
The title deeds have to be gone through after arranging them in
chronological order and then prepare an abstract of title. The
abstract must contain in a nut shell relevant information relating
to the deed which is abstracted. An abstract of title contains a
gist of the documents commencing with root of title and facts which
constitute the vendor's title.
For closure in a sale after all these reports purchaser's
requisitions on the vendor's title to the property is to be
prepared. The requisitions are of two type's general and
special requisitions. Special requisitions are objections raised by
the buyer on scrutiny and appraisal of the documents produced by
the vendor, and relate to title or defects in conveyance. General
requisitions are more or less of a routine type of inquiries. A set
of general requisitions are those which one may adopt to suit a
particular transaction.
Thereafter arises the stage of preparing draft of the conveyance.
The following points are generally covered in the deed., 1]
Indemnity/ Guarantee from the present owner about his title over
property, 2] Indemnity/ Guarantee from the present owner about his
possession over property, 3] Indemnity/ Guarantee from the present
owner about non-reservation of the property, 4] Point making clear
that the said property does not relates with any public activity,
5] Point making clear that the said property is not a Trust
Property, 6] Point making clear that said property is not a
Government Granted Land, 7] Point making clear that no-one has any
right ( road/ parking) over said property, 8] ) Point about the
existing structure on property (if any). Because it may affect
valuation of the property, 9] If the said property is ancestral one
then it is necessary to make all members of the family as
consenting parties for the deed, 10] Purchase price of the property
is agreed mutually, with the schedule of payment, 11] The Photo
Identity Cards of the present owners must be attached to title
deed, 12] Indemnity/ Guarantee from the present owner about Non
Litigant property because any transaction for a property for which
litigation is pending is null and void in the eye of law, 13]
Boundaries of the property gives clear idea about the exact
location of the property. Therefore it is necessary to mention it
clearly in the Title-Deed, a part from this it is advisable to
attach a map showing exact location of the property., 14] Witness
to the deed plays very important role if the deal goes in to any
Litigation, It is advisable to take one owner of adjoining property
as witness as it will help to prove possession of the present
owner..
Also the an income tax clearance certificate must be obtained
under section 230A of the income tax act. All necessary
registration and stamp duty must also be complied with. Thus
investigation of title is a very vast procedure and it plays prime
role in matters of property.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.