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Property Disputes

PROPERTY DISPUTES INDIA

In India, most of the cases regarding property disputes are pertaining to the title of the immoveable property. Property disputes can be for numerous reasons, however most of these disputes are often by legal heirs, co-owners, disputes over easement rights, wrong representation by the seller, improper description of the property in the title deed, etc.

Common Property Disputes in India

Title over Immoveable Property

A person who has a title over a property has the right to enjoy the rights or interests in such property, possession, use, income by way of rent, etc. A person is said to have a title over a property if he has sufficient documentary evidence to support his claim. Dispute over title can arise for many reasons for instance, during the transaction of acquiring the property or post transaction, or wherein property is acquired by gift or under a will and a third party disputes it to legally invalid, etc.

Such disputes can be avoided by proceeding with the investigation of the title over the immovable property before acquiring it. Investigation should be made at least of the last 30 years of the property for a thorough verification.

Delay in Possession of Flats by Builders

Most of the real estate development projects are delayed for various reasons but most of it is due to delay in procurement of regulatory and authoritative compliances that is to be obtained by the Builder.

To avoid such delays, sanctioned plans should be asked from the Builder to compare it with the actual built-up area. This is necessary as most of the times, the sanctioned plan does not match the built up area which may lead to an illegal construction.

Non-Payment

Non-payment or delay in the payment of rent is one of the most commonly occurring dispute in the real estate sector. Owners or Builders have no other choice but to approach the Court which involved a lot of cost and time.

To avoid such issue of non-payment, security deposit can be taken that will act as the safeguard in the event if the builder does not pay or delays the payment. Ensure and ask sufficient security for non-payment in addition to heavy penalty clause in the consent agreement or the permanent alternate accommodation agreement.

Disputes relating to inherited property

 Inherited property basically refers to the property received by a person through succession or by a will, as an heir or otherwise. One has to be very careful in buying inherited property inherited from his or her ancestors or from other persons. Problems buying or even selling such property are cumbersome and the probability of fraud is high in such cases. Disputes generally occur when a purchaser purchases such inherited property without the knowledge of such property being a inherited property or without the knowledge such property being subject to the conditions of will, probate, letters of administration or a succession certificate. However, mere knowledge does not suffice, it is relevant to understand how such property was inherited and whether the person was entitled to such a property. The property is inherited from deceased persons to their legal heirs and even by other persons. When a person dies and has made a will for distribution of his assets, the property is distributed as per wishes set out in the will and in the case of a person dying intestate i.e without making any will, the property is distributed as per the letters of administration obtained by one of the administrators from the court of law or through or under a succession certificate obtained from the court of law under the appropriate succession laws of an individual. Disputes in both the cases may occur if such inherited property is acquired without going through the process of due diligence and without knowing how the property was transferred to the current seller. Ideally, for such transactions, it is always advisable to hire an experienced property lawyer and to understand the adverse effects of the same.

Wills may be challenged as to its authenticity on the grounds that the maker of the will was not a fit person when he made the will or the will is not the last and final will or the property has been distributed in contravention of the wishes set out in the will or the will is fallacious.

On the other hand, in cases where the property was not distributed by a will but through letters of administration or succession certificate, buying such inherited property also leaves the buyer open to many risks, if the property is distributed as opposed to the conditions set out in the letters of administration or succession certificate or in the rare case the property was not distributed as per the laws governing a class of persons or an individual.

A dispute may arise from the legal heir or a person if he has not received his share to his entitlement under a will or the letters of administration or the succession certificate. Thus, it is utmost important and necessary to be extra diligent in buying such property and to avoid legal tangles at a future date. Such disputes are a common cause of the defect in the marketable title to the property.

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What are the salient features of Real Estate (Regulation and Development) Act, 2016?

Broadly speaking, the salient features of the Act are:

i.          Establishment of Real Estate Regulatory Authority

ii.         Registration of Real Estate Projects and Registration of Real Estate Agents

iii.        Mandatory Public Disclosure of all project details.

iv.        Functions and Duties of Promoter

v.         Compulsory deposit of 50 percent amount

vi.        Adherence to declared plans

vii.       Functions of Real Estate Agents

viii.      Rights and Duties of Allottees

ix.        Functions of Real Estate Regulatory Authority

x.         Establishment of Real Estate Appellate Tribunal

xi.        Punitive Provisions

xii.       Bar of Jurisdiction Courts

xiii.      Power to make Rules and Regulations

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What are the liabilities of a promoter under the Real Estate in India is the Real Estate (Regulation and Development) Act, 2016?

The Real Estate Act requires a promoter to do the following:

(i) to make available the documents and information necessary for inspection to persons taking or intending to take a property. These documents include the ones necessary for registration but are not limited to them. Further, the title should be certified by the Revenue Authority. Details regarding encumbrances, layout plan, estimated cost should be given.

(ii)to issue or publish an advertisement or prospectus for inviting persons to make advances only after acquiring registration and filing a copy of the advertisement in the office of the Regulating Authority.

(iii) to enter all records and details on the website maintained by the Authority after verifying the facts.

(iv)to compensate any person who suffers a loss by reason of any untrue statement in the advertisement or prospectus.

(v) To receive any advance or deposit from a real estate consumer only under a written agreement of sale

(vi) give due notice to other parties and refund the amount with the specified interest before cancelling any agreement.

(vii)to take measures for the protection and safety of the property. Promoter is also supposed to maintain accounts of sums taken from and on behalf of the allottees, register and record for audit purposes in a prescribed manner.

(viii)To make certain documents available to the allottees during the project period. These documents are in addition to the ones contemplated in Section 6 of the Real Estate Bill which were for the purpose of inspection and include site plans with structural designs and specifications, nature of fittings, time schedule of completion of project and for connecting the project with municipal services, agreements entered into regarding the construction of the building and statutory compliance related to revenue, planning, building and structural safety laws. A completion certificate of the project is to be obtained b the promoter from the local authority and given to the allottee. This list is however, not exhaustive as other documents may be required to be given by the promoter.

(ix)Not to make any alterations can be made to the approved layout plan after it is given to the allottee without the previous consent of the allottee, architect and engineer and without permission of the Regulatory Authority.

(x)to rectify any defect brought to his notice within 2 years of possession of property by allottee and should compensate for the same. Any dispute in this regard is to be referred to the Regulatory Authority.

(xi)To complete his title and convey exclusive ownership of the concerned property and interests therein to the allottee. The promoter shall deliver the documents of title to the allottee within three months of giving possession of the concerned property by way of a conveyance deed.

(xii) not mortgage the plot or apartment without the consent of the person who has taken or agreed to take such plot or apartment after execution of agreement of sale and if such a mortgage is made it shall not affect the right of such a person.

(xiii)beresponsible for supplying essential services such as water, electricity, sanitary services and these services can be withheld only with just and sufficient notice.

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