Advocate Selvakumar|Property Advocates in Bangalore|Senior Lawyer
Public in
general frequently use encumbrance certificates in property transactions
because the sole proof to establish free and marketable title of the seller.
They’re underneath the impression that the encumbrance certificate would
disclose all the costs created on a property. But, it's not therefore. There is
also many kinds of encumbrances, which is able to not be mirrored within the
encumbrance certificate. Applying for encumbrance certificate is to be
submitted at the territorial Sub-Registrar's workplace underneath whose
jurisdiction the property falls. The prescribed form for getting an encumbrance
certificate is Form No.22.
In order to
induce a correct and valid certificate, it's important that the applicant
should clearly mention within the application the amount that the encumbrance
certificate is needed, careful description of the property, its measurements,
boundaries, and also the one that is applying. The encumbrance year commences
from April first of a calendar and closes on March thirty first of following
calendar year. Any fraction of the encumbrance year attracts fee for the
complete year. The fee prescribed is for single property and per individual
form.
Form No.15 or 16
The
encumbrance certificate is issued either in type No. 15 or 16. If the property
doesn't have any encumbrance throughout the actual amount that encumbrance
certificate is wanted, then encumbrance certificate in type No.16 are issued
i.e., Certificate of nil Encumbrance are issued. If the property has any
encumbrance registered throughout the actual amount that encumbrance
certificate is wanted, then encumbrance certificate in type No.15 are issued.
The certificate in type No.15 discloses the documents registered in respect of
the property, the parties to the deed, nature of encumbrance, amounts secured
or transacted within the same deed, registered variety of the document, book
no., volume no., and date.
The
encumbrance certificate issued always is within the language during which
indexes are ready specifically Registrar or Sub-Registrar's workplace. If
the indexes aren't in English and also the soul needs certificate to be ready
in English, then the request of the soul are complied with to the extent
doable. In province, now processed encumbrance certificates are issued.
There is a
provision for review of the records of the property maintained within the
office of the Sub-registrar by the soul himself/herself. Just in case the soul
prefers to not exercise this authority and just submits application for issue
of encumbrance certificate for a selected amount, the department would be issue
the encumbrance certificate with due diligence and care. However, there's a
rider clause within the processed encumbrance certificate to state that the
department shall not take responsibility for mistakes, if any, within the
encumbrance certificate.
Limitation
Though an
encumbrance certificates discloses all registered encumbrances on a selected
property throughout an amount, its bound limitations. The Encumbrances
disclosed within the certificate are for the amount that certificate is
issued and encumbrance created throughout the amount previous this era or
throughout the later period isn't mirrored within the certificate. The
encumbrance certificate is issued in respect of the property as careful within
the form and not as per the registered documents of the property. Thus, if the
outline of the property represented within the application doesn't match with
the small print of the property as shown within the registered documents, then
details of such documents aren't mirrored within the encumbrance certificate.
The encumbrance certificate discloses the
encumbrances created by documents that are registered in an exceedingly
explicit workplace. In different words, it's the extract of the property
register maintained within the Sub- Registrar's workplace and also the document
that isn't registered and wherever underneath any charge is formed doesn't get
mirrored within the encumbrance certificate. Further, there are a unit bound
documents that registration isn't obligatory however registration is
nonmandatory. These documents embrace official document documents, document making lease for a amount of not surpassing one year, any decree or order of a
court, or award. Since these transactions aren't mandatorily registered ready,
they are doing not notice any mention in encumbrance certificate.
Agricultural Land
Agricultural
lands area unit typically familial. The change of possession is recorded in
revenue records, mutation register of village panchayath.Such changes of
possession aren't registered. Intrinsically encumbrance certificates don't
mirror verity possession of the agricultural land. R.T.C, Mutation extracts
provide complete details of amendment of possession, details of possession,
conversion of agricultural land to non-agricultural functions. Therefore, it's
higher to insist and trust RTC and mutation extracts just in case of
agricultural lands additionally to the encumbrance certificate.
It is
continuously sensible to get encumbrance certificates for a minimum amount of
forty three years and to verify whether or not the encumbrance certificate is
issued for the entire amount of your demand and whether or not it contains the
boundaries and also the measurements of the property, signature of registering
authority and also the workplace stamp except for revealing the names and also
the signature of the persons who have searched and verified the records of the property. It’s additionally sensible for the prospective purchaser of property
to examine the property in person and to verify and ensure that the initial
title documents are on the market with the seller. Additionally to the
current, some extra safeguards like paper notification, looking out in
jurisdictional courts for any pending cases may additionally be undertaken to
shield the interests of the vendee.
It is
suggested that for tracing the clear and marketable title of the property, the
purchasers mustn't in the main trust the encumbrance certificate issued by the
Registrar or Sub-Registrar's office, however should examine all different
relevant documents, like title deeds, latest khata certificate, khata extract,
and tax paid receipts.
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