Buying a piece of land or plot is a dream for everyone as land is considered to be a safe and most appreciating asset class. The purpose could be for occupation, to secure a family’s future, children’s education, marriage or just an investment. Unlike countries like Australia or USA, where buying a property is as easy as buying any other product or commodity, it is quite cumbersome and a time consuming process in India. As India does not have a UNIFIED CIVIL CODE, land laws are governed by different statutes. There are no standard checklists to verify the property documents as land in India is a state subject and local laws are also to be studied in addition to the centrally governed acts.
Due Diligence checklist before buying a plot in the state of Karnataka :
▪ Mother Deeds
▪ Chain of title flow
▪ RTC and revenue documents
▪ Is the property an ancestral property or self acquired?
▪ Family tree of the sellers issued by the local Village Accountant to be verified
▪ Absolute sale deed & Khata in the present sellers name
▪ Latest tax paid receipt
▪ If there are any encumbrances / loan on the property and how the same will be cleared?
▪ If it is an ancestral property, has a partition deed, release deed etc been executed between the family members?
▪ As per Supreme Court judgement, all children, be it a son or a daughter, have an equal share in any ancestral property. Hence, are all coparceners a party to the sale deed?
▪ Verification of original documents
▪ Conversion order for change of land use from agricultural to residential
▪ Approved layout plan
▪ Unique Property ID / E-Khata in the name of the seller. In the state of Karnataka, sale of revenue sites (B Khata / a piece of land that does not have all requisite approvals) are banned. Hence ensure that the proposed site is not a “B” Khata plot.
▪ It is advisable to check if loans are available for the land / plot purchase. That way risk can be mitigated.
▪ If the plot is part of a plotted development project, check for registration with the Real Estate Regulation & Development Act and respective state rules and the compliance there of
It is also advised to go with a reputed land developer with a good track record to entrust your hard earned money. A second opinion with an expert will also help.
Be Diligent, invest safe & build wealth!
