What is Propertified?

Propertified is a one stop solution for all property related services. Be it title certification, drafting of agreements /deeds, procuring a document, registration assistance. Our services are available PAN India.

Why should I come to you?

We are a team of professionals with internal and external lawyers specialized only on property matters. We also have in housed real estate professionals with expertise in property litigations and troubleshooting.Propertified is the only platform which has all property related services under one roof. It becomes easy choice for a client/customer.

My property/Project is approved by all major banks. Do I still need to get the property documents verified and get a legal opinion?

Majority builders/developers/sellers have tie up with all banks and legal opinion by a particular bank is a default formality. In cases where the property is funded by a bank, the bank lawyer also draws out a legal opinion. The builder/seller may push you into closing the deal using the said legal opinion. Such legal opinions are typically drawn keeping the bank's interest in mind. Since it is your money at stake we suggest you get an independent and unbiased legal opinion.

Do you provide service at doorstep?

Yes. All you need to do is raise a service request.

What are payment methods available?

Currently we accept payments only online.

Who are the persons who are exempted from appearance at the Registration Office?

Section 38 of Indian Registration Act specifies the persons who are exempted from appearance at the Registration office. They are:- 1) A person who by reason of bodily infirmity is unable to appear without risk or serious inconvenience 2) A person who is in Jail under Civil or Criminal process. 3) Persons exempted by law from appearance in court and who would but for provision in the Registration Act, be required to appear in person at & registration office.

Is it possible to register an apartment which comes under Village Panchayat or a CMC?

It is not advisable to buy an apartment which falls under the Panchayat even though the registration is possible now. But Apartment coming under CMC area can be registered withou any problems.

When the doctrine of part performance is not available?

When the person who desires to invoke the doctrine of part performance is not the signatory to the agreement or the consent party nor the recitals show that the agreement was entered into with the consent of such person, he cannot seek protection under the doctrine of part performance since there is no privity of contract between the parties.

What are the stamp duty payable in Karnataka for registration of an agreement to sell and the construction agreement?

The stamp duty payable for agreement to sell is Rs. 200/- when no possession of the property is handed over to the purchaser. & similarly, the stamp duty payable for construction agreement is Rs. 50/-.

Suppose in an agreement to sell, there is a clause that the vendor shall complete the sale transaction within three months of the date of agreement to sell, but fails to comply with this requirement. Whether the agreement would become void and unenforceable?

Non-compliance of a clause in the agreement to sell would not make the agreement void. The vendor has legal remedy to open him up to three years from the date of such a lapse.

How joint rights devolve?

This is quite a different situation from what we discussed earlier. Here a single person makes a promise to two or more persons jointly. The promisor is single person and promisees are more than one. All the joint promisees during their lifetime, on death of any of them, the legal heirs/representative of the deceased promisee become promisee with other surviving promisees and on death of the last surviving promisee the representatives of all promisees jointly acquire rights to enforce the contract.

What if the promisee releases one of the joint promisor?

In case of a joint promise made by two or more persons, the promisee may release any of joint promisors from performing the contract. But such release does release the other promisor from performing the contract and does not discharge the released the promisor of his liability, responsibility to other joint promisors.

Can a promisee enforce the contract on any one of the promisor?

The promisee may enforce the contract against any of promisor in case of joint promise made by two or more persons, if the terms of contract do not provide any contrary intention. However, each of the joint promisors has a right against other promisors. They may compel the other promisors to contribute equally or as provided in the contract for performance of contract. In case of any of the joint promisors defaults in contributing towards performance, the remaining joint promisors must bear the loss arising from such default in equal shares. The section 43 of Indian Contract Act makes it very clear; In case the surety makes payment on behalf of the principal, the surety is entitled to recover the same from the principal. The provision of section 43 applies where two or more persons have made a joint promise. But it does not apply in case where two or more persons have become jointly interested by inheritance in a contract made by a single person. When a mortgage was executed by a single mortgagor, the mortgagee suing four out of five heirs is entitled to recover only four-fifth of the mortgaged amount from them. But if the mortgage is executed by several mortgagors then the mortgagee can enforce the entire liability against a part of mortgaged property. In case of joint family debts contracted by the managing member, are the debts due for all the members of joint family and all other joint family members are bound to repay the same but their liability is not personal but only to the extent of joint family assets.

How joint liabilities devolve on the death of any one of the joint promisor?

The Section 42 of 'the Indian Contract Act' deals with this situation. It does not make any distinction between joint promises and several promises. According to the said section in the absence of any contrary in the contract, all the persons who made promise during their joint lives; after the death of any of the promisor, legal heirs / representative of deceased promisor along with surviving promisors; after the death of the last surviving promisor, the legal heirs, representatives of all the promisors, are bound to fulfill the promise. But if the contract provides for any contrary intension the liability devolves according to the contract.

What are the joint liabilities?

When two or more persons promise jointly to perform or to do something for a consideration, it is liability of all such persons who promised to perform or to do something. Such contractual obligations of the promises are joint liabilities, which are governed by 'Indian Contract Act, 1872'. We come across many such contracts in purchase, sale of the immovable properties and construction sector and also in administration of partnership assets. The person who makes promise is promisor and to whom the promise made is promisee.

Whether the act of part performance applies to gifts?

The applicability of part performance has two important ingredients, the existence of written contract and payment of consideration. The transfer should be a transfer for consideration. In case of gifts there is neither sale contract nor consideration. The essence of the gift is transfer of property without consideration. As such the doctrine of part performance is not applicable to gifts.

Whether the equitable right of the purchaser is enforceable against third party?

The equitable right is available only against the seller or anybody claiming under him. It is not enforceable against party who has purchased the property for consideration and who has no knowledge of contract or act of part performance.

What are the requirements of part performance?

Section 53 A of Transfer of Property Act stipulates certain conditions 1. It must be contract for transfer of immovable property for consideration. 2. It must be in writing. 3. It must have been signed by the seller or his authorized agents. 4. The terms of contract shall be clear, should be ascertainable with reasonable care with certainty, the act of part performance should also be part of the contract. 5. The vendor in pursuance of the contract should have put the purchaser in possession of the property. The purchaser should have taken the possession and if already in possession shall continue to be in possession. 6. The purchaser has done some act like payment of consideration in pursuance of the contract or willing to perform his part of contract. 14: If the full sale consideration is not paid, how the seller can proceed against purchaser who is in possession of the property? The only remedy available to the seller is to file a suit for recovery of balance amount of sale consideration or other rights as provided in the contract of sale.

Whether part performance is recognized and what are the rights of the purchaser?

Section 53 A of Transfer of Property Act recognizes part performance. The purchaser who gets possession of the property under terms of contracts gets equitable rights. The seller who puts the purchaser in possession and anybody claiming under is debarred from enforcing against the purchaser or anybody claiming under purchaser. The seller cannot enforce eviction against the purchaser, once he has put him in possession of the property. The purchaser can continue and enjoy the possession of the property even though the sale deed is not executed and registered. Section 29 of Registration Act, recognizes the part performance.

What is part performance?

Sale of an immovable property is an act of contract between the parties. Each party to the contract has definite duties to perform; the vendor has to establish his title to the property, handover the title deeds and vacant possession of the property at the time of registration. The purchaser has to pay the consideration as agreed, attend the registration office and help in completion of registration formalities. The vacant possession of the property is handed over to the purchaser at the time of registration. But in certain cases, the vendor hands over the vacant possession of the property to the purchaser, pending registration of sale deed. This is called part performance.

What is the status of an agreement without consideration?

In general, any agreement without consideration is void. But, Section 25 of Indian Contract Act, 1872 has certain exceptions to this general rule. According to the section the following agreements without considerations are not declared void. A. An agreement which is made in writing and is registered and made out of natural love and affection by a person standing in near relationship. B. An agreement which is a promise made to compensate for something done for the promisor by a person voluntarily. The compensation may be in whole or part. C. An agreement which is a promise to pay a debt which is barred by limitation. Such promises must be in writing and signed by concerned person or his authorized agents. The promise to repay the time barred debt may be in whole or in part.

What are Void Agreements?

Agreements are instruments wherein two or more parties agree over something or to do some work or to sell or purchase a property. The essential requirement of an agreement is the presence of valid consideration and objects. Indian contract Act, 1872 deals with agreements. Void Agreements are those which cannot be enforced in any court of law. If the consideration or even a part of consideration or object is unlawful such agreements are deemed to be void agreements. Neither of the party to the agreement can seek any remedy for violation of such agreements in any court of law. The court declares such agreements as void.

Whether the property received by the donee by virtue of a gift deed in his favour would be treated as his self-acquired property or the joint family property of the donee and his children?

The property received by the donee under a gift deed shall be treated as his self-acquired property and he can deal with the same according to his sweet will and none of his children can put forth any claim over such property.

Whether a gift without consideration is Void?

By gift one transfers the property without consideration. It is a unilateral act of one person. It is not a contract between parties. Section 25 of the Indian contract Act provides that the provisions of the section do not affect the validity of any gift actually made between the donor and donee, though no consideration is passed. The condition should not be illegal or immoral.

Whether a gift be suspended or revoked?

It depends on the contents and conditions of the gift deed. Both the donor and donee, must agree for such conditions. The relevant section is 126 of transfer of property act. The gift may be cancelled or rescinded on the following grounds.

1. On occurrence of any event, specified in the gift deed, the event should be clearly described
2. Both the parties should have accepted the conditions, the done should have agreed for such condition while accepting the gift.
3. The proposed event, which suspends or revokes the gift, should be beyond the control, will of the donor.
4. The condition so imposed must not be repugnant to the gift.

What are stamp duty and registration charges payable on gift deed? Is there any concession in case of gifts to family members?

Though there is no consideration received on gift, it attracts stamp duty and registration charges as applicable to the sale deeds. However, there is concession in respect of gift to family members (spouse, son, daughter, daughter-in-law and grand children). The maximum stamp duty payable is Rs. 1000/- and additional cess of Rs. 50/- and infrastructure cess of Rs. 20 or Rs. 30. The registration fee is Rs. 500/-.

When a donor has to give his acceptance of the gift?

The transfer of property act stipulates that the acceptance of the gift has to be made during the lifetime of the donor, and when the donor is still capable of giving. As such, if the donor dies before acceptance, the gift is void. Similarly, if the donor is dispossessed of the gifted property because of the operation of law before the acceptance, the gift is void. Likewise, if the donor or donee becomes incompetent to contract before the acceptance, the gift is void. As the gift deed needs to be registered, the acceptance of the gift is usually recorded on gift deed itself.

In case of gift made to two or more persons, if any one of them does not accept the gift, what would be the effect?

In such cases, where one of the donees does not accept the gift, the gift is not invalid completely. The gift becomes inoperative, void as to the interest which was not accepted by the donee. The other donees, who accept the gift, are entitled only to what is gifted to them, and they do not have any right, interest, and title on the gift property which was not accepted by other donee

Whether gift made orally is valid?

The gift has to be made in writing and needs to be registered. But the personal law of Muslims permit oral gift. Three important ingredients of Muslim gift are viz.: declaration of gift, acceptance of gift, and delivery of the possession of the gift property. When claims of the oral gifts are made, law calls for strict evidence to establish an oral gift and there must be some contemporaneous evidence of oral gift.

Whether a gift of immovable property has to be made only by the donor or his authorized representative can also make a gift?

Section 123 of 'Transfer of Property Act, 1882' defines the mode of making a gift. It prescribes that the gift should be made by a registered document signed by the donor or on behalf of the donor, attested by at least by two witnesses. So any authorized representative of the donor may also make a gift. But authorization, which is the power of attorney, given to the representative should be clear as to the provision for making a gift. The power of attorney should be properly stamped.

Can an NRI (Non Resident Indian) avail housing loan?

Yes, Non Resident Indians can avail NRI housing loan to buy a property in India. However, the loan disbursement process as well as the terms & conditions for a loan taken by an NRI are different than regular home loans granted to Indian residents.

Who can be a Co-Applicant?

Co-Applicants are the Co-Owners of the property in respect of which the financial assistance is sought. Usually joint applications are from: husband-wife, father-son or mother-son.

What security is to be provided by the borrower for housing loan?

The borrower has to mortgage the property in respect of which housing loan is being obtained by way of deposit of title deeds. The title should be clear and marketable. Some HFCs may also require collateral security like the assignment of life insurance policies, pledging of shares, NSCs, units of mutual funds, bank deposits or other investments.

Whether the mortgaged property requires to be insured?

You will have to ensure that the mortgaged property is insured to cover the amount borrowed against fire and other hazards, as are required by the HFC during subsistence of the loan and you will have to produce evidence each year of your insuring the mortgaged property.

Can the housing loan be repaid ahead of schedule?

Yes, you can pay your loan ahead of schedule. However, it must be noted that some of the housing finance companies charge a fee for early redemption of loan. This fee can vary between 1-2% of the loan amount being prepaid.

What are the Collateral Securities which are taken by the Housing Finance Companies?

HFCs may take some additional securities which are called collateral securities. These may be in the form of guarantee from one or two persons, assignment of life insurance policies, deposit of shares, and units or other securities. These additional securities are taken with the intention that if the amount borrowed is not paid back, and then recourse may be taken to such securities. Guarantors, when alerted, become very effective persons in prevailing upon the borrowers to fulfill their obligations.

What is the maximum amount a home loan borrower can borrow?

Home loans generally provided are in the range of 75%-85% of the asset value. The amount of loan varies from one institution to another and the maximum loan amount may vary from Rs.1 Lakh to Rs.1 Crore. The primary concern of the HFCs in determining the loan eligibility is that you are comfortably able to repay the amount you borrow. Your repayment capacity is determined by taking into consideration factors such as income, age, qualifications, number of dependants, spouse's income, assets, liabilities, stability and continuity of occupation and savings history, etc.

Can home loan be obtained for construction of a house in a city other than the place of work?

Yes, you can take loan for construction of house in a city other than the place of work. The HFCs generally grant housing loan after getting details of the plot legally verified.

How to get home loan?

You need to approach a Housing Finance Company (HFC) / Bank with the latest salary slip and other relevant documents of yourself and your co-applicant, if any. The concerned officer of HFC/Bank after going through the details of the documents will informally tell you the loan amount you are eligible for and the terms of the same. Thereupon, you need to submit the prescribed application form along with the necessary documents. On receipt of the application form, the HFC/bank examines it, seeks clarification wherever necessary and conveys its decision to you. You are advised to visit more than one Housing Finance Company / bank since you are likely to get better terms/ larger loan amount at the discretion of the bank.

What is the difference between monthly rest and annual rest?

In a monthly rest, the interest is calculated on the outstanding principal at the beginning of every month. Once the interest is calculated at the rate applicable to you for the month it is deducted from the EMI received during the month.

Annual rest works on the same principal only the interest is calculated on your outstanding principal at the beginning of every year. It is also commonly known as "Yearly Reducing Balance"

Monthly reducing balance is a better option since you get credit for repayments made immediately and accordingly the interest component keeps reducing on monthly basis.

Can home loan be converted from fixed rate to floating rate & vice versa?

Yes, you can convert floating rate into a fixed rate with no extra charges. However, to convert from fixed rate to floating rate, banks will charge a small fee. The swap can be done any number of times and at any point of time.

When should one opt for a fixed rate home loan?

A fixed rate home loan is one where the interest rate on home loans charged by the lender is constant over the tenure of the loan. It is advisable to go in for a fixed rate only if you feel that the rate of interest prevailing in the market have touched rock bottom and the rates can only move upwards.

Can home loans be obtained against two different properties?

Yes, you can have as many loans as you desire against different properties subject to fulfillment of the requirement of the lending Bank. The criteria amongst many lending institution majorly are: your ability to repay EMIs regularly and to satisfy the bank of your re-paying capacity.

Whether banks and financial institutions lend money for purchase of land?

Yes, some banks do consider grant of loan for purchase of land as long as it is for residential purpose only. Banks also grant composite loan for purchase of house sites and for construction of house there on. The quantum of housing loan would depend on your credit profile and re-paying capacity.

You get no tax breaks if you take loan to buy a plot of land. But, if you take a composite loan for purchase of site and construction of house thereon, you can get a tax break. In such a case, the tax benefits are available on both portions of the loan - one to purchase the plot and the other one taken to construct the house thereon.

Please note that the benefits under Income Tax Act can be availed only when the construction of the house is complete.

What are the charges other than interest that are levied by home loan lenders?

Almost all lenders charge certain administrative or processing fees apart from interest for providing home loan. You must compare all these charges well before signing a home loan contract. The following are some charges:

• Legal fees: payable to the lender or to the legal consultants of the lender.
• Technical or Valuation charges: payable to the lender or to his technical consultant.
• Pre Closure Charges: This is the biggest charge that most borrowers miss taking into account. A loan can be prepaid either in part or in full at any given point of time. You can also prepay a loan even when it is only partly disbursed. However, most banks & have an upper limit on the number of times a person can prepay his loan in a year as well as on the minimum amount you can prepay each time. Until recently, banks charged a penalty for part or full prepayment. Increased competition has forced most banks to allow repayment without any charges if it is funded from own sources. In case the borrower, is transferring the loan to another lender he will need to pay the Pre Payment charges.
• Stamp Duty: Stamp duty is to be paid on the mortgage deed or on the memorandum of deposit of title deeds at the prevailing rates.



For what purposes housing loan can be availed?

Housing loan can be availed for the following purposes:

• for purchase of plot
• for purchase of ready-built house
• for purchase of an apartment/flat
• for purchase site-cum-construction purposes
• for repair and renovation of the existing building

In case of take over loan where the property is transferred by virtue of a general power of attorney whether the bank should insist on execution of a new general power of attorney or the earlier general power of attorney will hold good?




If the borrower is represented through his GPA holder, the bank should insist on the borrower executing a fresh power of attorney in favour of GPA holder or in the alternative the bank may insist on production of a confirmation letter from the borrower stating that the power of attorney already executed in favour of the GPA holder shall still remain valid and hold good and the GPA holder is authorized to execute necessary documents for purposes of take over loans from the bank.

It is the normal practice that banks advance money to the individual borrowers for purchase of flats in an apartment building. Suppose after release of home loan to the individual borrower, either in full or in part, who in turn has passed on this sum to the developer and the developer abandons the project half way through or unduly delays in completion of the apartment building depriving the borrower to get the sale deed executed in his favour, then how the bank can enforce its right for the money lent to the borrower for purchase of a flat in the said apartment building?




While advancing money to an individual apartment buyer in an apartment building, the bank should insist on providing sufficient number of guarantors and other securities for prompt repayment of the money borrowed. It may be noted that till the apartment is registered in the name of the individual owner, the individual borrower shall not have any right over the land and building in an apartment building.

What right the creditor bank gets from the deed of declaration and joint development agreement, if not registered or proper stamp duty is not paid on the instrument?




The Joint Development Agreement and the Deed of Declaration are executed by the concerned parties and shall be enforceable against each other upon fulfillment of all the statutory requirements. The creditor bank does not get any right or interest from such documents irrespective of whether they are registered or not. The bank may insist upon furnishing collateral security of any other property of either of the parties to the transaction [i.e. the land owner or the builder] or of third persons who can stand as surety for prompt repayment of the loan by the borrower. The bank may also insist upon creation of equitable mortgage of the property by the land owner on which the proposed construction activity is to commence by the developer in terms of the Joint Venture Agreement and this document is to be registered. The creditor bank may also make the land owner and/or the developer to execute personal indemnity bond for the loan amount.

1.What is the role of a builder, promoter in group housing complex?

After completion of the housing project the builder should facilitate the formation of association of apartment owners and convey the property along with undivided shares in the land to the Purchasers.

A project is said to be complete, when the construction is complete as per the plan along with the external walls in the side, necessary services like power, water and sewerage are provided to each apartment and occupancy certificate is obtained from the City Corporation or other authorities.

The builder should hand over the project to the association after the building is complete in every respect. The builder should also hand over the original title deeds of the property, approved plans, approvals received from other agencies like water supply, power etc., to the association.

2.In multi-storied buildings maintenance charges is charged and frequently the word AMC is used & Please explain the words?

Maintenance means, maintaining the building, machinery, and related common areas in good and working conditions. In the case of apartments it refers to maintenance of common areas, common lighting, staircases, elevators, etc., which are for the common benefit of all the occupants of the particular building.

AMC means, Annual Maintenance Contract. Association of apartment owners entrust the maintenance of common areas/machinery to an outside agency, terms and conditions for the same are reduced into writing in the form of a contract known as Annual Maintenance Contract.

3.Please clarify whether it is correct on the part of the association to collect more maintenance charges from tenants irrespective of it being paid by the owner or by the tenant himself.

This is not correct as even if the tenant is paying the maintenance charges, it is being paid on behalf of the Owner only.

4.I live in an apartment of 16 units (GF plus 3 floors). & I live on the third floor. & the owner living below me (second floor) has complained of leakages in his bathroom. & I did attempt some repairs (plastering) on my bathroom floors. This proved to be a temporary solution. & now he is demanding replastering of my bathroom and refixing of tiles. & I insisted in this case the cost towards repair and materials to be shared mutually. & Am I justified in my argument? What does the rule say?

You have been very fair in your dealings. In fact, if this pertains to a common expense, the same has to be borne by the association. & otherwise, it has to be borne by the owner concerned.

5.I would like to know on what basis the flat maintenance charges could be raised from the present amount? Our building is over six years old and has 65 flats. We recently completed painting the outside walls for which the corpus fund was used. & Being six years old, the water pumping motors for all the five blocks need replacement and also expenses are there for the OTA space closing, hard topping in the two wheeler parking area. Please advice.

The maintenance charges have to be arrived at on the basis of the actual expenses that are being incurred on a monthly basis. If the charges are being increased, there must be justifiable reason & for the nature of work mentioned by you, there can be a one-time contribution which can be collected from the members.

6.A person is having more than one flat in a building. Is his voting right in proportion to his stake?

The voting rights will be in proportion to the number of units or the total built up area owned by the person concerned.

7.Ours is a registered Association (Societies Act) & and we are collecting the maintenance charges equally irrespective of the fact whether it is a two or three bed room flat or of the UDS area. This decision is taken in our G.B. Meeting because of the fact that the maintenance is collected for keeping the Security personnel, cleaning and lighting the common area, purchase of water when yield from bore wells are not sufficient and pumping water from bore well to sump and from sump to OH tank. We are providing 24 hours uninterrupted water supply. We wish to know whether any mention is made in the act regarding collection of maintenance charges?

The Act only refers to payment of maintenance charges on the basis of percentage of undivided share in common areas and facilities. However, in many instances, the maintenance charges are being levied on the basis of number of units owned irrespective of the size. This is only a convenient arrangement which is to be treated as having been accepted by the parties concerned.

8.The legal grounds under which a defaulting tenant can be vacated: is that if any tenant guilty of an act or conduct which is nuisance to other occupiers of the portions in the same building or buildings in the neighborhood can be forced to vacate as per prevailing law. In our case, one among eight owners (residents) is willfully creating a nuisance by the way of additional burden to remaining residents (owners or their tenants) by not sharing the expenses towards common facilities but continuing to enjoy all the common facilities.

This is not regarded as a nuisance, although many practical difficulties may be caused owing to the default of the owner concerned & in all such cases, the remedy is to proceed against the person concerned as provided for in the by-laws of the association by instituting a suit or arbitration proceedings, as the case may be, for suitable relief. & if there is no registered association, then all the other owners will have to proceed against the person for suitable relief in a Court of Law.

9.Can the Customer, after executing agreement, by a simple letter authorize the Company to present the same for registration before registrar?

Sec. 32:Persons presenting documents for registration except in the cases mentioned in Sec. 31, 88 & 89, every document to be registered under this Act, whether such registration be compulsory or optional, shall be presented at the proper registration office:

• (a) By some person executing or claiming under the same or in the case of copy of a decree or order, claiming under the decree or order there under; OR
• (b) By the representative or assign of such person; OR
• (c) By the Agent or representative of such persons, duly authorised by power of attorney executed and authenticated in manner mentioned.

On plain reading of the above provisions it is clear that a customer after executing an Agreement can authorize the company, by a simple letter to present the same for registration before the Registrar, as per clause (b) of section 32 of the Act.

However, it would be advisable to obtain a registered general power of attorney executed by the purchaser in favour of the company to present the document for registration.

10.In case of non compliance of the provisions of this Act, what are the consequences?

The relevant provisions for non compliance of The Karnataka Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1972, are sections 12, 13, 14, & 15. Which are dealt with herein below:

Sec. 12: General liabilities of a person who takes a flat

Any person who has executed an agreement to take a flat and who without reasonable excuse failed to pay at the proper time and place the price, the Municipal Taxes, Water and Electricity charges Ground Rent, and other Public Charges, payable in respect of the Flat taken by him, shall on conviction be punished with fine which may extend to Rs. 1000/-

Sec. 13Manager not to cut off, withhold, curtail or reduce essential supply or service- Any person, who is a promoter, or who is in charge of management or connected with the management as a member of the Managing Committee Director/ Secretary, who contravenes the provisions of Section 13 or disobeyed the directions of the Court for restoration of amenities shall on conviction be punished with &; imprisonment for a term which may extend to 3 months or with fine or with both.

Sec. 14:Offences by promoter: Any promoter & who & without & reasonable excuse fails to comply with, or contravenes any provisions of the Act or any Rule made there under shall on conviction be punished with imprisonment for a term which may extend to one year or with fine which may extend to Rs. 2000/- or with both and any & promoter who commits criminal breach of trust of any amount advanced or deposited with him for the purposes mentioned in Section 5 shall on conviction be punished & with imprisonment for a term which may extend to 4 years or with fine or with both.

Sec. 15: Offences by companies If a person committing an offence under this Act is a Company, every person who at the time the offence was committed was in charge of and was responsible to the Company for the conduct of business by the Company as well as the Company & shall be & deemed to be & guilty of the & offence and shall be liable to be proceeded against and punished accordingly except wherein such person proves that the offence was committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

In case an offence under this Act has been committed with the consent or connivance of, or is attributable to any negligence on the part of any director, Manager, Secretary or other officer of the Company, such Director, Manager, Secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to proceeded against and punished accordingly.

Note: (1) Section 5 deals with the promoter to maintain separate account of sums taken as advance or deposit and to be trustee thereof and disburse them for purposes for which given.
(2) The language used in this note under sec. 12, 13, 14 and 15 are not the verbatim of the stature language.

11.What is defect liability period? What do you mean by guarantee and warranty period?

Defect liability period means, the period in which quality of construction is tested/verified. This period is generally 6 months including rainy season. During defect liability period the builder will be liable to rectify any defects noticed in the construction, like seepage of water structural, cracks in the walls. The purchaser will retain a portion of the consideration amount which will be released only after the lapse of defect liability period.

Guarantee is a contract which is personal in nature between individuals, companies and firms. Guarantor would always be a third person, who is liable to compensate in case of any loss suffered. The word surety is also used instead of guarantee. This practice is prevalent mostly in financial transaction and performance contracts.

The word warranty is used in case of sale of goods. The Warranty is extended by the company/manufacturer to the purchasers/end users. The company undertakes to set right any defects noticed in its products during specified period called warranty period.

12.When the builder will hand over the project to the owners association and what documents builders are supposed to give?

The builder has to hand over the project to the association after the building is complete in every respect. The builder has to hand over the original title deeds of the property, approved plans, approvals received from other agencies like water supply, power etc. to the association.

13. When a project is called a "Completed Project"?

A project is said to be completed, when the construction is completed as per the plan and necessary services like power, water, sewerage are provided to each apartment and occupancy certificate from the city corporation or other authorities is obtained.

14.How maintenance charges should be calculated?

Maintenance charges are calculated in proportion to the total area of the project and area of the apartment occupied. It will be calculated on sift basis.

15.What is AMC? Where this term is used?

AMC means Annual Maintenance contract. Association of apartment owners entrust the maintenance of common areas / machinery to an outside agency and the terms are reduced into writing in the form of a contract.

16. What are all various types of maintenances?

There are two types of maintenances, preventive maintenance and general maintenance. Preventive maintenance means protecting the building and machinery from natural elements so that they last long. This includes periodical colour washing, replacing the spares and servicing. General maintenance means maintaining the common areas and machineries in clean working conditions, replacing fused bulbs, sweeping and washing the common areas etc.

17. What is maintenance?

Maintenance means maintaining the building, machinery and related common areas in good and working conditions. In case of apartments, this refers to the maintenance of common areas, common lighting, basement, parking areas, garden, children playing area, swimming pool, playground, lobby, laundry, elevator, staircases, water tank, sump tank, pent house, plumbing, sanitary, electrical networking, foundation, main valves, common corridors etc. for the common benefit of all the occupants of the building.

18. What are the duties of the apartment promoter?

As per the Karnataka Ownership Flats (Regulation of Promotion of Construction Sale, Management and Transfer) Act, 1972, the following are the duties of an apartment promoter.

A promoter, who constructs or intends to construct such a block or building of flats, shall-

a) Make a full and true disclosure of the nature of his title to the land on which the flats are constructed or are to be constructed; such a title to the land as aforesaid having been duly certified by an Advocate of not less than seven years standing

b) Make full and true disclosure of all encumbrances on such land, including any right, title, interest or claim of any party in or over such land

c) Allow inspection on reasonable notice of the plans and specifications of the building built or to be built on the land; such plans and specifications having been approved by the local authority which he is required to do under any law for the time being in force

d) Disclose the nature of fixtures, fittings and amenities (including the provision for one or more lifts) provided or to be provided

e) Disclose on reasonable notice or demand if the promoter is himself the builder, the prescribed particulars such as the design and the materials to be used in the construction of the building and if the promoter is not himself the builder then should disclose on such notice or demand, all agreements (and where there is no written agreement, the details of all agreements) entered into by him with the architects and contractors regarding the design, materials and construction of the building

f) Specify in writing the date by which possession of the flat is to be handed over

g) Prepare and maintain a list of flats with their numbers already sold or agreed to be sold and the names and addresses of the parties and the price charged or agreed to be charged therefore, and the terms and conditions if any on which the flats are sold or agreed to be sold

h) State in writing, the precise nature of the organization of persons to be constituted and to which title is to be passed, and the terms and conditions governing such organization of person who have taken or are to take the flats

i) Not to allow any person to enter into possession until a completion certificate where such certificate is required to be given under any law, is duly given to the local authority

j) Make a full and true disclosure of all outgoings (including ground rent if any, municipal or other local taxes, taxes on income, water charges and electricity charges, revenue assessment, interest on any mortgage or other encumbrances, if any)

k) Make a full and true disclosure of such other information and documents in such a manner as may be prescribed and give on demand true copies of such documents referred to in any of the clauses of this sub-section and may be prescribed only on payment of reasonable charge.

19. What is deed of declaration?

Deed of declaration is an instrument by which property is submitted to the provisions of Karnataka Apartment Ownership Act 1972. It contains description of land on which buildings is constructed, details of & building like number of storeys, number of apartments, description of common areas, and limited common areas etc.

20. Who is an apartment owner?

An Apartment owner means the person or persons owning an apartment and undivided interest in the common areas and also facilities in percentage specified and established in the declaration.

21. What is a flat?

According to flat Ownership Act, 1972, a flat is different from apartment. Although in common usage both are similar but a flat is described as a separate and self contained set of premises intended to be used for residence or office or showroom or shop or godown and includes a garage and the premises forming a part of the building. The apartment has to be used only for residence.

22. Who is a promoter?

Promoter is one who constructs or causes to be constructed a block or building of flats or apartments for the purpose of selling the same or all of them to other persons or to a company or co-operative society or others.

23. What are common profits?

Common profits mean balance of income remaining, after rents, profits, and revenues from the common areas and facilities are deducted from the common expenses.

24. What are common expenses?

Common expenses means:

a. All sums lawfully assessed against apartment owners by the Association of Apartment owners.

b. Expenses of administration, maintenance, repair or replacement of common areas and facilities.

c. Expenses agreed as common expenses by the bye-laws.

d. Expenses declared as common expenses by the provisions of Karnataka Apartment Ownership Act or by the declaration or the bye-laws.

25. What is Duplex house?

A type of house divided into two parts with two separate homes in it, upper and lower. An apartment with rooms on two levels is called as Duplex house.

26. What is a pent house?

Pent house is a very expensive and comfortable apartment or set of rooms built on the top of a tall building with vacant space in front.

27. What is an apartment?

Karnataka Apartment ownership Act 1972, defines apartment as "A part of the property intended for any type of Independent use, including one or more rooms or enclosed spaces located on one or more floors (or parts thereof) in a building, intended to be used for residential purposes with direct exit to a public street road or highway or to a common area leading to such street, road or highway.

28. What is plantation land?

The land where crops like cardamom, coffee, tea, pepper, coca and rubber are cultivated is called as Plantation land.

29. What is carpet area, super built up area, plinth area and common areas?

Carpet area means the inside useable area between wall to wall.

Super built up area means outer wall to outer wall. This is saleable and is generally applicable to apartments. This includes the wall thickness, projected common areas and the set back area.

Plinth area means the area measured externally with respect to the whole building. Plinth area is said to include the proportionate common areas on the floor like passage, stair case, etc.

Common areas It is actually the covered area of the common spaces and areas meant for use by all the occupants of the building. These areas may include staircase, lifts, ducts for sanitation, electrical and air conditioning areas etc.

30. What is Row housing?

Row of houses attached to each other by a common wall with only front and rear open spaces is known as row housing.

31. What is common wall?

Common wall means:

A) A wall built on land belonging to adjoining owners and the wall being the joint property of both the owners.

b) If two adjoining owners build dividing walls on their property, they are not common walls and no part of the footings of either wall shall project on to the land of the adjoining owner except by legal agreement between the owners.

c) Any such 'common' or 'dividing' wall shall be considered for the purpose of these bye-laws, as being equivalent to an external wall as far as the thickness and height are concerned.

32. What is a High rise building?

Building with more than four floors, i.e., Ground floor + three floors and above, requiring the provision of a lift shall be considered as a high rise building for the purpose of these bye-laws.

33. What is Mezzanine floor?

A mezzanine floor is any intermediate floor between the two floors above the ground level accessible only from the lower floor. The area of the mezzanine floor is restricted to one third of the total floor area of that floor.

34. What is Group Housing?

Group of multistoried housing for more than one dwelling unit where land is owned jointly (as in the case of co-operative societies or the public agencies such as local authorities or housing boards etc) and the construction is undertaken by one Agency/Authority.OR

A building or a group of buildings constructed with one or more floors, where each floor consists of one or more dwelling units and having common service facilities like staircase lift, balcony, verandah, etc.

35. What is Floor Area Ratio (FAR)?

Floor Area Ratio means the quotient obtained by dividing the total covered area of all the floors by the plot area. & Floor area includes the mezzanine floor also.

a) The floor excludes the area used for car parking, staircase room, lift room, ramp, escalators, ducts, water tanks, main sanitary duct, open balcony area, machine rooms.

b)When sites do not face the road of required width noted against each then the FAR applicable to corresponding width of roads shall apply.

c)When a site faces wider road then the one prescribed against it, the FAR shall be restricted only to the limit prescribed for the area of that particular site.

d)When coverage is less than the maximum prescribed in Table No.24, more No. of floor and height may be permitted to utilize the full FAR.

e)The setbacks and coverage are irrespective of the road width.

36. What is fore closure fee?

This is a fee charged, if Loan is closed before the agreed period. If the bank and borrower have agreed for a repayment period of five years, and contrary to such agreement, the borrower prefers to close the Loan account at the end of two years, the bank imposes some penalty to compensate for the loss of interest. Such penalty is called for-closure fee which is generally 1% of the outstanding Loan.

37. What is flat rate?

In flat rate of interest, the interest is charged on the full amount of Loan for the entire period, irrespective of your repayments. If you have availed a Loan of ten lakh rupees repayable in ten years, the interest will be charged on ten lakh rupees for all the ten years, ignoring your repayments.

38. What is fixed and floating rate?

There are two different modes of interest viz. Fixed and Floating rates. Floating rate is also called as Variable rate. In fixed rate, the rate of interest is fixed, and will not change during entire period of the Loan. Fixed rate will be higher than floating rate, as it is not affected by market fluctuations. In floating rate or variable rate, the rate of interest changes depending upon market conditions. It may increase or decrease, depending upon the change. The repayment period also varies with these changes in rates, but the equated monthly installment remains the same. Presently, floating rate is most favored by lending institutions. If the repayment period is more than five years, it is advisable to prefer fixed rate.

39. What is Annual, Monthly reducing Balances?

Reducing balances means the time at which interest is calculated and applied to the Loan account. Repayments of home loans are by way of equated installments, paid every month. But housing finance companies adopt different modes of adjusting these monthly repayments towards the Loan accounts and to bring down the due Loan. In annual reducing balance method, the monthly repayments received from the borrower are kept in a suspense account and transferred to Loan account only once in a year (generally on 1st of April). To be more clear, if your Loan amount on 1st April, 2003 is Rs. 5,00,000/- and you pay monthly installments of Rs. 10,000/-, your entire payment of Rs. 1,20,000/- (10,000/- x 12 = 1,20,000/-) will be adjusted towards Loan amount only on 01/04/2004 and interest from 1.4.2003 to 31.3.2004 will be calculated on Rs. 5 lakhs. This works out very costly, as you will be paying the interest on Rs. 5,00,000/- for the entire 12 months. In case of monthly reducing, the repayments are credited to your Loan account on a particular day in a month, though you have paid much earlier. If any particular housing finance company has fixed 15th of every month, for such adjustments, and you have paid on 5th of the month, your Loan amount gets reduced only on 15th. Most of housing finance companies have shifted from annual reducing balance to monthly reducing balance. Most preferable mode is daily reducing type, where your Loan amount gets reduced on the very day of your payment.

40. How does Hindu Undivided Family come into existence under Hindu Law as well as under Income-tax Act, 1961?

The concept of HUF under Hindu law as well as Income-tax Act, 1961 is the same. As stated earlier, HUF is purely a creature of law and cannot be created by an act of parties (except in case of adoption and reunion). A HUF is a fluctuating body, its size increases with birth of a male member in the family and decreases on death of a member of the family. Females go and come into HUF on marriage. In case of a sole male Hindu, strictly speaking, a HUF comes to existence automatically upon his marriage. It has been held by the Hon'ble Supreme Court in Gowli Buddanna v/s. CIT [(1966) 60 ITR 293 (SC)] that to constitute a joint Hindu family, it is not necessary that there has to be more than one coparcener in the family; a husband and wife can validly constitute a HUF.

1.What do you mean by Zonal Regulation?

Any development must conform to the land use of the zone in which it is located. One cannot construct a commercial building in an area earmarked for residential purposes. The Zonal Regulation regulates the height of the buildings, formation of layouts etc.

2.What is the meaning of CDP?

CDP is the short form for Comprehensive Development Plan. This is formulated by the Government. Under this Plan Bangalore Metropolitan Area has been divided into various zones, such as Residential, Commercial, Industrial, Green Belt, and others.

3.Who can buy an agricultural land?

Agricultural land can be bought after fulfilling 3 requirements. They are:

(1) the annual average income of the person including agricultural income, should be less than Rs. 2 lakh.

(2) The person must have an agricultural land in his name before the year 1974.

(3) The person should be an agriculturist or an agricultural labour by profession.

4.Is it necessary to fill in domicile column while applying for second time?

The domicile column should be invariably filled in every attempt.

5.What is land use?

Comprehensive development plan has divided the area into different zones and accordingly lands have to be used for the prescribed activities. Every survey number has specific prescribed land use. These are:-

1. Residential.

2. Commercial (Retail and Wholesale business)

3. Industrial (light and service industries, medium industries & heavy industries)

4. Public and Semi-public.

5. Utilities and Services.

6. Parks, open spaces, playgrounds (including public recreational areas).

7. Transportation and communication.

5.What is land use?

Different land uses can also be prescribed for single survey number. It is very important to ascertain the land use prescribed for particular survey number because floor area ratio sets back coverage ad varies according to the land use.

6.What is Form 10 and Form 10 conversions?

A valid form 10 is issued by the Village Panchayat to record the payment of House tax in Gramathana. Thus, Form 10 is a conclusive proof for the status of the Land as a residential site. But, many panchayatdars have started issuing form 10 even for agricultural lands called Form 10 conversions, which are invalid.

7.What are Agricultural lands?

Lands surrounding Gramathana sites in villages are used for agricultural purposes are known as Agricultural lands. The numbers given to them are called survey numbers. Agricultural lands within Green belt area have many restrictions with regard to conversion and constructions. Agricultural lands falling under urban agglomeration can be converted and used for non-agricultural purposes like, residential, commercial and Industrial subject to compliance of Zonal Regulation land use. It is very important to note that only Deputy Commissioner of Bangalore District is authorized to permit conversion of agricultural lands to non-agricultural purposes, falling under his jurisdiction.

8.What is Gramathana site?

Gramathana is different from agricultural lands. It is an area earmarked for residential purposes in a village. It is numbered as Kaneshumari number. Gramathana site though located in green belt area, does not require conversion for residential purposes. But extra care is required while purchasing those properties as there are large numbers of form 10 conversions.

9.What is Green Belt Area?

The third circle in the comprehensive development area is green belt area. This area is solely meant for promoting greenery to maintain environmental equilibrium. Large-scale growth of trees and other greenery is encouraged in Green belt area. Large-scale construction is not permitted in villages coming under green belt area. Only farm houses and other related activities are allowed.

10.What is urban agglomeration?

The comprehensive development plan has 'three circle approach'. The innermost circle covers the areas coming under the control and administration of City Corporation. The second circle includes areas beyond corporation limits, which are governed by BDA, City Municipal Councils and even Panchayats.The first two circles together constitute 'urban agglomeration'. Various acts like Income Tax Act and Urban Land Ceiling and Regulations Act 1976 (since repealed in Karnataka) refer to urban agglomeration.

11.What do you mean by Conversion Order?

Utilizing agricultural land for any other purpose is prohibited. If anyone makes a layout without conversion, it is an illegal act and a serious violation of the provisions of law. Therefore, agricultural land, which does not come under Green Belt, can be converted for residential purpose as per the zonal regulations.

12.Is it possible to change the land use?

According to the Comprehensive Development Plan, usage of lands is earmarked as residential, commercial, park, semi-park, public etc

One has to make a request, for the change of the land use, which should be justified according to the development in that area. Change of the land use may be given by the BDA after considering various factors. However green belt area cannot be changed.

13.Is it possible to register a Gramathana site having Form No. 9 & 10?

Yes, it is possible to register the site. However, it is duty of the purchaser to look into the title before purchase of the property. Generally the Gramathana sites do not have Sy. no. and reference title is the most important aspect of the verified from origin, flow and present, status. The vendor having a title can transfer the property by way of registration. If he has a defective title he will transfer only the defective title. It is the duty of the purchaser to look into the title thorough an advocate who is having specialized knowledge on property legal aspects.

14.What are the consequences of purchasing a Revenue Site by a non-agriculturist?

The very acquisition of revenue site (agricultural land) is against the law. it very clear that such purchase is null and void. If any non-agriculturist purchases revenue site (agricultural land), he is duty bound to inform the details of land and his annual income to the jurisdictional Thasildhar within 90 days from the date of purchase. The Thasildhar after enquiry will forward the details to the deputy commissioner. The deputy commissioner will notify that such lands shall stand transferred to and vest in the State Government, from some specified date without any compensation. Many form such as no. 9 & 10 issued are false, and the original revenue records remain in the name of the Original owner. In case of acquisition by development authorities/ government the original owner will get the compensation and not the purchaser Further, though the form nos. 9 & 10 mentions the site no. and area in square feet, the original records continue to mention survey numbers and area in Acres and Guntas. It would be very difficult to identify the exact site, its area and boundaries and link with form no. 9 & 10.

15.How to detect the Revenue Sites and approved residential sites?

All the documents of the property, origin of title, RTC extracts, mutation extracts, conversion orders, paid conversion fee receipts, have to be examined. If the land is converted, it should be reflected in RTC. Further, tax payments receipts discloses the nature of the tax paid, whether land revenue or property tax. Revenue Lands have survey nos. and are mentioned in areas and guntas; whereas, residential sites have site numbers and mentioned in square feet. An experienced advocate would be helpful owing to the complexity of the different documents.

16.How revenue land be used for residential purpose?

The Revenue Land has to be converted for residential purpose. After conversion of the agricultural land to the residential purpose, the assessment of the land has to be done by the local authority like Gram-Panchayat, City Municipal Council, etc., for house site. The layout thus formed has to be approved by the statutory authorities.

17.What is conversion?

If any agricultural land has to be used for other purpose, it needs permission from Government of Karnataka. The Government permits such change of use on payment of prescribed fees for some specific purpose, like residential, commercial, and industrial. The special deputy commissioners are authorized officials to permit the conversion. The fee has to be remitted towards the government. The conversion is subject to various conditions such as provision for roads etc. The land has to be utilized for the converted purpose only and within the stipulated time.

18.Can one purchase a Revenue Site and construct a house?

The sites formed on agricultural lands, cannot be used for residential purpose. They remain as agricultural lands. Only agriculturist or agricultural labour is eligible to purchase agricultural lands. There are income restrictions also. Agriculturists, whose income from non-agricultural source is less than two lakhs are eligible to purchase and own agricultural lands. Others need government permission. Further, such lands have to be used only for agriculture, unless converted. Constructions of houses are not permitted.

19.What are Revenue Sites?

Sites formed on agricultural lands are revenue sites. They are unauthorized sites, which cannot be used for any non-agricultural purpose, residential houses.

20.What is Patta book?

This is a record supplied to the holder of agricultural land including tenant if he is primarily liable to pay land revenue and contains a copy of record of rights of such land

The book also contains information regarding the payment of land revenue and other government dues and information of cultivation.

21.What are Survey, Survey number, Survey mark?

Survey means the process to determine the measurement and record of boundary or boundaries of part of boundary. Survey number means, a portion of land of which the area and assessment are separately entered under an indicative number in land records.

Sub division of survey number means a portion of survey number of which the area and assessment are separately entered in land records

under an indicative number subordinate to the survey number of which it is a portion.

This is also called as "Hissa" number

Survey mark means any mark or objects erected, made or employed to indicate level of the property while determining the position of the boundaries.

22.Explain the terms like Village Map, Genealogical Tree?

Village map is a sketch, which gives the complete details of lands, houses including the gramathana sites, survey numbers, and house numbers and roads falling within the jurisdiction of the village. The survey department issues the village map

Genealogical tree is also called the family tree of any given person. It gives the details of the family, like names of the wife/wives of any given person, details of his children, grand children and so on.

It would help to trace the flow of the property and succession. The Village Accountant issues the genealogical tree.

23.What are RTC and Mutation Extracts?

RTC means Record of Right, Tenancy and Inspection of crops. This is a primary record issued by village Accountant. It contains the details of survey number, total extent of the land, names of the persons who are the owners and their extent of holding, persons in possession and details of crops grown and land revenue for any particular period. It also contains the details of conversion of land from agriculture to non-agricultural purpose

Mutation extract is an extract from the mutation register maintained by the Village Accountant. It records the transfer of land and the mode of such transfer, recommendations of the enquiry Officer for such transfer, date of entry of transfer and the record of rights.

24.Whether the land converted for residential purposes could be utilized for construction of a school building?

Change of land use requires permission of the competent authority i.e. the Deputy Commissioner of the jurisdictional area. In the present instance, the order of land conversion was obtained for residential purposes and therefore, this land cannot be utilized for construction of school building without an order from the jurisdictional Deputy Commissioner for change of land use who shall take into consideration the zonal regulations such as green belt area, commercial area, etc., before giving any permission for change of land use from residential to non-residential commercial use.

1.What is Doctrine of Tacking?

Doctrine of tacking is explained in section 93 of the Transfer of Property Act. The section prohibits tacking. When a subsequent mortgagee (puisne) discharges the legal mortgagees (first mortgagee) claim, he subrogates himself to the first mortgagees claim on such mortgaged property. This is called tacking. But this is prohibited under section 93 of the Act. Even after puisne mortgagee acquires the first mortgages claim by discharging the first mortgagee's dues, he has priority to the claim acquired which the first mortgagee had and must stand and wait in his proper place for his (as a puisne mortgagee) claim.

However an exception is provided in section 79 where tacking is allowed

Ex: Mr. A mortgages his property to Y bank to secure the repayment of borrowed amount of Rs. One Lakh. Later on Mr. A mortgages the same property to C to secure the repayment of loan of rupees one lakh. C notifies the second mortgage to Y Bank, and on the date of second mortgagee, amount due to the Y Bank was Rs. fifty thousand. Y bank though being aware of second mortgage lends to A making the total amount due exceeding one lakh. Y bank is entitled and has charge over the mortgaged property upto Rs. one lakh and has priority over C

2.Who is puisne mortgagee?

When a mortgagor mortgages the same property by successive mortgages to different mortgagees say A, B, C, the first mortgagee A is called legal mortgagee and subsequent mortgagees B and C are called puisne mortgages.

3.What is Doctrine of Marshalling?

Section 81 of the Transfer of Property Act refers to the Doctrine of Marshalling. A mortgagor may have mortgaged more than one property to same person and further mortgages some of the said properties to another person. In such cases, the subsequent mortgagee is entitled to earlier mortgaged debt be satisfied out of the property not mortgaged to him but mortgaged to earlier mortgagee without prejudice to the right of the first mortgagee or any other person who has acquired interest in the said property for consideration

Example: Mr. A mortgages his properties X and Y to B. There afterwards mortgages property Y to C. If the first mortgagee prefers to proceed against property Y, the subsequent mortgagee C may compel B to first proceed against property X and realise his dues. But, if B is unable to realise entire amount from property X, then he may proceed against property Y.

4.What is Doctrine of Consolidation?

As per section 67 of Transfer of Property Act, the mortgagee has a right to seek relief by way of sale of the mortgaged property or by foreclosure after the mortgaged money has become due. Section 67(A) of the Act refers to consolidation of suits preferred under section 67. If the mortgagee holds two or more mortgages by the same mortgagor and money of each such mortgage has become due unless terms of mortgage does not provide any exception, the mortgagee is bound to sue for foreclosure or sale of all mortgages consolidated

5.What is Doctrine of Accession and Improvement?

At times there will be a natural accession (addition) to the mortgaged property, where the benefit of accession to the property is available to both the mortgagor and the mortgagee. The mortgagee will have the accession as an additional security and the mortgagor on redemption is entitled to such accession

Improvements are different from accession and are manmade. If the improvements are not separate from the mortgaged property and are made by the mortgagee without the consent of the mortgagor then the mortgagor is entitled to such improvements on redemption without any payment for improvements. But, if they are done with the consent of the mortgagor or is in compliance with the statutory obligations of the mortgagor he has to compensate the mortgagee for such improvements. If the improvements are separable from the mortgaged property then the mortgagor is at liberty to pay for and acquire or not to pay and acquire them.

6.What are the essentials of deposit of title deeds?

The Section 58(f) of 'the Transfer of Property Act' deals with the deposit of title deeds. This is a type of recognized mode of mortgage, especially to meet the urgent financial needs. A person delivers to the creditor or his agent, documents of title of immovable property with an intention to create security for the amounts borrowed, it is called deposit of title deeds. Accordingly the essentials of the deposit of title deeds are debt, deposit of title deeds and intention to create a security.

7.How can a vendor produce documents of title for inspection by the purchaser when the property is under mortgage?

The purchaser may examine the photocopies of the documents of title, which are in Vendor's possession or within his power. The vendor can approach the mortgagee with a request to permit the potential purchaser to inspect the documents.

8.What are the documents of title required for creating Equitable Mortgage?

The documents of title required for creating Equitable Mortgage are the documents, which show the title of ownership of the mortgagor, such as Conveyance Deed, Gift Deed, Probated Will, Deed of Transfer, along with other supporting documents including the revenue records.

9.What is Anomalous Mortgage?

This mortgage is a mixture of other types of mortgages. This is not a Simple Mortgage; it is a Mortgage by Condition of Sale, a Usufructuary Mortgage, an English Mortgage, or Mortgage by deposit of title deeds. This is not a regular mortgage. This is not within the limits of other mortgages. Though anomalous, it is still a mortgage.

10.What is Usufructuary Mortgage?

In this mortgage, the mortgagor delivers possession and binds himself to deliver possession of the mortgaged property to the mortgagee, and authorizes him to retain such possession until payment of the mortgage money and to receive rents and profits accruing from the property in lieu of interest. This is otherwise known as compensation mortgage and as lease with no rent and no interest payable.

11.What is Mortgage by conditional sale?

In this mortgage, the mortgagor sells the property to the mortgagee on the condition that if payment of the mortgage money is defaulted on the specific date, the sale shall become absolute, and if the money is repaid, the mortgagee transfers the property back to the mortgagor.

12.What is Equitable Mortgage?

In Equitable Mortgage or Mortgage by deposit of title deeds, the deposit of title deeds can be done orally and the conditions of loan transactions can be recorded in writing. This type of mortgage can be created in specific cities as notified by the Government from time to time. The mortgagor can enforce the security only by sale of property through Court. However it does not need registration.

13.What is English Mortgage?

It is a transaction where the mortgagor commits himself to pay the mortgage money on a specific date and transfers the mortgaged property to the mortgagee absolutely, subject to the condition of transferring it back upon payment of the mortgaged money, as agreed. English mortgage involves a transfer of property to the mortgagee absolutely and on repayment of the loan and interest amount, the mortgagee is bound to transfer the property back to the mortgagor.

14.What is Simple Mortgage?

This mortgage is an agreement only, whereby the mortgagor agrees to repay the money borrowed to the mortgagee and agrees that in the event of failure to do so, the property may be sold and the money realized out of the sale proceeds to the mortgagee. However, it must be registered. Simple mortgages do not refer to any property transfer at all.

15.What is clog on redemption?

Clog means obstruction. A mortgagor has the right to enjoy hold of the property as he was entitled before he mortgaged it. If that right is prevented/restricted, such conditions are called clogs. A term/condition in a mortgage transaction is treated as clog, if it is unreasonable.

16.Whether partial redemption is allowed?

The mortgage is indivisible according to the Section 60 of the Transfer of property act. It does not allow partial redemption. Even anyone of the mortgagors cannot redeem any part of the mortgaged property by paying the proportionate amount. If redeemed, the entire property has to be redeemed. The only exception is, if the mortgagee is a creditor himself and is responsible for breaking the integrity of the mortgage by allowing the co-mortgagor to redeem partially or when he acquires the interest of one of the co-mortgagors.

The Collector or dist. Registrar may call for the abstract of the instrument and also for the evidence to prove that all the circumstances and facts are correctly set forth in the instrument. The Collector thereof will decide the correct stamp duty payable and on payment of duty or any shortfall, shall certify to that effect. Such person need not pay any penalty or fine. If the document does not attract any stamp duty the Collector shall certify accordingly.

17.What are the remedies available to the mortgagee?

The mortgagee has three remedies. A suit may be filed on personal covenant, where the mortgagor has undertaken to repay the debt, binding him personally. A suit can also be filed for sale and thirdly may exercise his right of foreclosure.

18.What is foreclosure?

This right is available to the mortgagee, who may exercise this after the mortgaged money has become due and before decree has been passed for redemption or mortgaged money has been paid or deposited in the court. The mortgagee has a right to obtain from a competent court a decree that the mortgagor shall absolutely be debarred of his right of redemption or that the property be sold.

19.What is meant by Redemption?

Redemption is the right available to the mortgagor, the person who transferred the interest in the immovable property. He may at any time after the principal money has become due repay the amount due and can get the interest in the specific immovable property transferred in his favour, and can also get back the possession if delivered to the mortgagee.

20.What is meant by mortgage by possession and mortgage without Possession?

In case of mortgage by possession, the physical possession of the immovable property is delivered, possession is important in case of Usufructuary mortgage. In case of mortgage without possession, the physical possession of the property is not delivered like in simple mortgage.

21.What are the different kinds of mortgages?

There are six types of mortgages:-

1. Simple Mortgage
2. Mortgage by conditional sale
3. Usufructory Mortgages
4. English Mortgages
5. Mortgages by deposit of title deeds
6. Anomalous Mortgage.

22.What is the difference between mortgage and pledge?

Mortgage is dealt as per transfer of property act, 1882 and pledge is regulated as per Indian Contracts Act, 1872.

Pledge is the bailment of goods as security for payment of debt, performance or promise. The Pawnee holds the possession of goods as security, but has no right of foreclosure; as there is no transfer of ownership. Right of enjoyment of property is also not given to the Pawnee.

Transfer of possession is very important in case of pledge but is not necessary in case of mortgage and depends on the type of mortgage. Under mortgage there is transfer of interest whereas in case of pledge, the Pawnee has only special right of detaining the goods till the repayment of loan is complete. Mortgagor has the right of redemption and the mortgagee has the right of foreclosure, where as the Pawnee does not have right of foreclosure.

23.Can a mortgage be done in favour of a Company?

Yes, the transfer of specific interest in an immovable property should be in favour of a living person. Here living person includes company, association, and body of individuals.

24.What is a Mortgage?

Transfer of property act 1882, under section 58(a) deals with mortgage. The necessary ingredients of mortgage are

1. Transfer of interest in specific immovable property.
2. Transfer is for the purpose of securing the payment of money advanced or to be advanced by way of loan.
3. It may be existing and future debt
4. It may be also for performance of an engagement, which may lead to financial liability.

1.Does Notary charge any fee for doing Notarial Acts?

'The Notaries Rules, 1956', has prescribed the fees for each category of acts. The Rule No. 10 refers to the fee to be collected by the Notary. They are the maximum fees which can be charged by a Notary. Every Notary shall display rates of fees charged in conspicuous space both inside and outside of his chamber or office. In addition to the fees, notary may also charge the travelling allowance by train or road at Rupees Five per kilometer.

2.Whether Notary Public has to ensure that proper stamp duty is paid on instrument?

Before doing any Act of Notary, it is the duty of the Notary to ensure that the proper stamp duty is paid, if not he may impound it under Section 33(1) of the Stamp Act. Apart from the regular stamp duty, the act of Notary attracts additional stamp duty under Article 42 of Indian Stamp Act and Article 36 of Karnataka Stamp Act, which is Ten Rupees.

3.Whether the affidavits verified by Notary are admissible in civil / criminal courts?

The Section 139 of 'Code of Civil Procedure, 1908' has an express provision, in this regard. Any affidavit verified by notary is admissible as evidence. Likewise, Section 297 of 'code of criminal procedure' provides for admission of affidavits verified by the Notary.

4.What is a Notary Seal?

It is mandatory for Notary to use his official seal. 'The Notaries Rules, 1956' has prescribed the form and design of the seal to be used. It shall be plain circular seal of 5 cm. in diameter. It shall contain the name of the Notary, the jurisdictional area where he has been appointed to exercise his functions, the registration number, and circumscription "NOTARY" and the name of the Government which has appointed him/her. The notary shall use his official seal on every document. The Evidence Act also provides that the courts should take judicial notice of seal of notary. In the absence of seal of notary, the document has no evidentiary value.

5.When a Notarial is completed?

Every Notarial act has to be done under his signature and Notary seal with Registered No. and date.

6.What are the functions of Notary?

The appointment, functions of Notary is governed by The Notaries Act 1952.

There are various functions of a Notary. We shall confine here to functions which are more relevant to the common public

1. To verify; authenticate, certify or attest the execution of any instrument. The act refers to the "instrument". The word instrument is defined in the Act, as every document by which any right or liability is purported or purports to be, created transferred, modified, limited, extended, suspended, extinguished or recorded. So every document is not an instrument, unless it effects right or a liability. Each word: verify, authenticate, certify, attest, have different meanings. Authenticating means, the notary has assured himself of the identity of person who has signed the instrument as well as to the fact of execution. Certify means to testify. Notary is bound to make entry of notarial act of certifying the copy of the document as true copy of original. Attest means to bear witnesses to
2. To administer oath to, or take affidavit from any person
3. To translate and verify the translation, of any document from one language into another.
4. To act as commissioner, to record evidence in any civil or criminal trial if so directed by the court or authority.
5. To act as arbitrator, mediator, or councilor if so required.
6. To do any other act this, may be prescribed.

7.Who is a Notary?

Notary is person appointed by the Central Government or State Government under Notaries Act 1952. Central Government may appoint Notary for the whole or any part of India. Likewise the State Government may appoint a notary for the entire or for any part of the State. He is a public officer.

1.What is meant by irrevocable power of attorney of immovable properties?

If the deed of power of attorney mentions that power of attorney is executed after having received full value of the property and is irrevocable, such power of attorney is called irrevocable power of attorney. It cannot be revoked unilaterally until the property is transferred.

2.Who can apply for a copy of the GPA in Sub-Registrar's office?

Copies of GPA can be obtained by the Executant of GPA or the GPA holder.

3.Whether the General Power of Attorney requires registration?

A Power of Attorney need not be registered under the Registration Act even if it relates to an immovable property since it does not create any legal right to the attorney. However, a power of attorney is required to be stamped according to the nature of the authority delegated. A power of attorney authorizing the attorney to sell an immovable property and for consideration is required to be stamped as a conveyance but need not be registered. If the power of attorney is only for presenting the document for registration and for admitting the execution thereof on behalf of the Executant, such a power of attorney should be registered before the concerned registrar.

4.Whether the power of attorney can be revoked?

A power of attorney can be revoked or would stand revoked if

(i) it is revoked by the principal or

(ii) if the principal dies or becomes of unsound mind or

(iii) if the business of agency comes to an end or

(iv) if the principal is adjudged insolvent.

A power of attorney may also be terminated by operation of law when

(a) the period for which it is given expires, and

(b) the performance becomes impossible or illegal.

The power of attorney given by a firm would stand dissolved, when the said partnership firm is dissolved.

However, a power of attorney cannot be revoked after the attorney has exercised the authority given to him in respect of the acts exercised. If the power of attorney is given jointly by two or more persons, the death of any one of them will not revoke the power of attorney in respect of others. An irrevocable power of attorney cannot also be revoked. For example, a power of attorney in favour of a bank authorizing the bank to sell the property hypothecated to the bank and to adjust the sale proceeds would be an irrevocable power. It cannot also be revoked if the agent or attorney himself has an interest in the property which forms the subject matter of the agency unless there is express contract to the contrary.

5.Can an attorney delegate his authority?

Under section 190 of the Contract Act, an agent or an attorney cannot lawfully employ another person to perform such acts which he is authorized to perform personally except in cases where by custom of the trade he can appoint sub-agents; an attorney cannot delegate his powers unless he is expressly or impliedly authorized to do so.

6.What is the method to execute a power of attorney?

The most common method to execute a power of attorney is to sign it in the presence of, and get it authenticated by, a Notary Public or any court, judge, magistrate, Indian consul or vice consul or representative of the Central Government as required under sec.85 of the Indian Evidence Act.

In the case of individuals, the power of attorney is executed by the principal / donor like any other document. In the case of partnership firm, the power of attorney in favour of any partner or an outsider must be executed by all the partners. However, if one or more partners hold a general power of attorney executed by all the partners with a power to delegate, these partners can execute a power of attorney in favour of third person for and on behalf of the firm.

In the case of a limited company, the power of attorney in favour of any director or a third person must bear the common seal of the company and is to be executed in accordance with the resolution of the Board of Directors and as per the Articles of Association of the Company. It must be duly authenticated by the Notary Public or other authorities as noted above.

7.What is power of attorney?

Power of attorney is a document of agency whereby the principal appoints an agent or an attorney to do and execute several acts and deeds for and on behalf of the principal. A power of attorney is an express authority in writing. An attorney is an independent person to whom powers are given under the authority. A power of attorney may be a general power of attorney or a special power of attorney. A general power of attorney covers more than one subject matter while a special power of attorney relates to a specific subject matter.

8.In case, where Power of Attorney is given to more than one person to act jointly how it operates on death of one?

In case of Power of Attorney is given jointly to more than one person to act jointly all the Power of Attorney holders should act in unison. If any one of them dies, the survivors cannot act as joint power of attorney holders of the principal and the power of attorney gets cancelled. Any act done subsequent to the death of one of the power of attorney holders is not binding on the principal.

9.Can a Power of Attorney jointly executed in favour of several persons be revoked by one of them?

Where several persons have jointly appointed a person as Power of Attorney holder; one of them is not entitled to revoke the authority. But, if the authority is joint and several, revocation by one principal will determine the authority which he himself has given.

10.Whether a Power of Attorney is revoked when the Power of Attorney holder has an interest in subject matter?

When a Power of Attorney holder himself has an interest in subject matter the principal cannot revoke the power unilaterally. We can understand this with the help of an example

Example: A gives power to B to sell A's land and to apply the sale proceeds to amount due from A to B. A cannot revoke the Power of Attorney unilaterally under any circumstances. Section 202 of Indian Contract Act deals with this situation.

11.Can more than one person appoint a single person as Power of Attorney Holder?

There is no objection to two or more persons jointly executing a Power of Attorney to one and same person, provided there is community of purpose between the persons executing the document.

12.Can a Power of Attorney holder delegate his powers to others?

A Power of Attorney holder cannot delegate his powers to a third person. Section 190 of Indian Contract Act underlines the dictum "Delegate non protest delegare". If the document specifically provide for such delegation or the ordinary custom of trade is such it requires such delegation, the powers may be delegated to the extent provided in the document.

13.Is it necessary that Power of Attorney be registered?

The instrument of Power of Attorney is not needed to be compulsorily registered under Indian Registration Act, 1908. But, if the Executant of a document gives Power of Attorney to another person to present the document for registration such instrument needs authentication and registration as per sections 32, and 33 of Registration Act. It should be noted that authentication and registration is necessary when a document is presented by a Power of Attorney holder other than Executant. However, it is advisable to register the Power of Attorney to establish its genuineness.

14.Whether a notary of another country authenticates the Power of Attorney executed by a Non Resident Indian outside India, to be used in India?

Under Section 85 of Indian Evidence Act the following persons are empowered to authenticate the Power of Attorney

1. Notary Public.
2. Any court of Judge or Magistrate.
3. Indian Consul or Vice Consul
4. Representative of Central Government

Under section 14 of Notaries Act, the Central Government of India has to issue notification detailing the recognition of notaries of other countries. But, Government of India has not issued any such notification making reciprocal arrangements for recognition of notarial act of foreign notaries. However, the courts in India are recognizing notary public of other countries and there are various judgments in this regard (Abdul Jabbar and others AIR 1980, Allahabad 369).

15.Whether the principal or donor can cancel the agency or power of attorney?

The principal or donor may cancel the agency or power of attorney with due notice. Further, proper notice should be given to the public. Such agency also gets cancelled, when the work for which agency was granted is completed or by the death of the principal /donor or agent or any one of them becomes of unsound mind or insolvent.

However, if the agent himself has any interest in the property which is a subject matter of agency, it cannot be cancelled, unless the agent agrees. Further, the principal cannot cancel the agency after the agent has partially exercised his authority. In case of power of attorney given to sell the property, if the power of attorney holder has entered into a sale agreement in accordance with the terms of power of attorney the donor cannot cancel the power of attorney until the sale is completed and the sale agreement is binding on the principal.

16.What is the responsibility of an agent who employs a sub-agent without authority?

When an agent appoints a sub-agent without proper authority, the agent is responsible for the acts of the sub-agent to both the principal and to third parties. The principal is not responsible for the acts of the sub-agent, nor is the sub-agent responsible to the principal.

17.What is relation between the Original Principal and sub-agent?

A sub-agent if properly appointed according to the terms of the agency or to meet the requirements of business binds the principal for his acts with the third person. The agent is responsible to the principle for the acts of the sub-agent. The sub-agent is responsible for his acts to the agent and not to the principal except in case of fraud or willful wrong.

18-Who is a sub-Agent?

A sub-agent is a person employed by and acting under the control of original agent. The relationship between original agent and sub-agent is that of principal and agent.