Remedies for a landlord if the tenant refuses to leave after an eviction notice

Eviction notice remedies for a landlord if the tenant refuses to leave after an eviction notice

There has always been a huge amount of skepticism around the landlord-tenant equation in our country. Legally, the landlord-tenant relationship is governed by Rent laws which differ from State to State. 

In case of any problem, the law permits eviction of the tenant on specific grounds-illegal measures to evict the tenant should be avoided. 

In reality, it is challenging to deal with a tenant who refuses to leave even after being served an eviction notice.

The landlord may opt for having a conversation with the tenant. It helps to understand what is preventing him from leaving the premises. It is always better to have a word and work out a solution. 

Read more: Investment in Indian Property – As an NRI investor know your facts

Eviction Notice:

If dialogue does not help, a legal notice is sent. Sending an eviction notice is the first step to initiate the process of ejectment. It is a legal notice vide which the landlord informs the tenant the reasons for seeking his removal from the rented accommodation. 

A notice period of a reasonable number of days is given to vacate the premises.

The requirement of sending a notice to the tenant depends upon the applicable rent laws. A landlord must be conversant with the rule and regulations of the tenancy as prevalent in the area. 

Once the notice is served, the tenant may do what the landlord demands. 

Read more: The necessity of Legal Due Diligence in India

What if tenant refuses to go even after eviction notice?

Legal battles are often time consuming and expensive. However, sometimes there is no option left.

If the eviction notice is served, the tenant may refuse to leave. The landlord then files a suit in the court for ejectment of the tenant. It is advised to take help of professionals/law firms to draft and file the petition. A lawsuit is filed in the appropriate court within whose jurisdiction falls the rented property.

There are various grounds available to a landlord for evicting the tenant, like:

  • Violation of terms of the agreement by the tenant
  • Personal Necessity of the landlord – the property is needed for personal use
  • Non-payment of rent
  • Premises has become unsafe for human habitation and needs repair
  • Property is needed for renovation or alteration

The petition is filed after expiry of the said notice period, stating:

  • The terms of the rent agreement/lease deed between the tenant and the landlord
  • The violation made by the tenant – unauthorized use, subletting, non-payment of rent etc.
  • The period of non-payment of rent and the amount due

The landlord has to explain the violation of the lease deed. If there is no rent/lease deed, it becomes difficult for the landlord to make his point.

The copy of the eviction notice served upon the tenant is annexed with the petition.

It is pertinent to mention here that sometimes the landlord forgoes pending rent in case of eviction suits as he is more interested in getting back the possession of the property.

Read more: Selling a Property through a General Power of Attorney – Is it even valid?

Hearing in court:

The court fixes a date for the hearing. The parties are heard, and the order is pronounced. 

If the landlord wins the arguments, the court orders the tenant to hand over the possession of the property to him. The court grants time to the tenant to vacate the property.

If the tenant still fails to do so, the judicial order gets executed by filing an execution petition. The court appoints a Court Officer for removing the tenant. The Police may also intervene in case of recalcitrant tenants. 

Read more: How to save title of your property from illegal occupants?

Investment in Indian Property – As an NRI investor know your facts

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The first question in the minds of any potential property investor is mostly regarding the safety of such an investment. 

The answer, though not difficult, does involve an analysis of the economy and exercise of due diligence in the area of investment.  The relief factor, however, is that there are competent Professionals and Law firms who assist and guide the investor to decide prudently.

Investment in Indian Property is a lucrative option. It is supported by investor-friendly policies of RBI and the guidelines of FEMA. The introduction of RERA (Real Estate Regulatory Authority) has driven the NRIs to invest in India. There is a rise in accountability, which has helped to gain their confidence.

Investment decisions are broadly based on profitability and governmental policies.  

For NRIs, there is another significant factor that motivates them to invest in India. It is the opportunity to stay connected with the roots and the native place.

NRIs must remember:

NRIs can invest in any commercial or residential Indian Property, except agriculture land, plantation, and farmhouses.  

NRIs can purchase more than one residential or commercial property without any permission from RBI or Government. There is no need to inform the RBI about such a transaction.  

Read More: NRIs Alert! Buying property in India? The guidelines

For Investment in Indian Property, NRIs must know:

  • Conformity to rules: NRIs must comply with the guidelines of RBI and FEMA for investment.
  • Loan Availability: 

RBI has issued general permission to all banks to provide loan facilities to the NRIs for the purchase of Property in India. NRIs have to meet the eligibility criteria and must possess the requisite documents, like valid passport, PAN Card, Photographs and other prescribed documents.

  • Mode of payment: All payments have to be made in Indian Currency. NRIs who buy the Indian property can make the payment,
  • By remitting through proper banking channels from abroad.
  • By making use of funds in the NRE/NRO/FCNR accounts. Even, the housing loan that has been availed is repaid using funds from these accounts.

Taxation Policy:

  • Income from investment in the property is either in the form of rental income or capital gains. This income is taxable. 
  • Under DTAA (Double Taxation Avoidance Agreements), an NRI can claim the tax credit in his country of residence, for taxes paid in India.
  • Tax benefits on purchase of the Property in India are the same for both NRIs and resident Indians. Deduction of Rs 1.50 lac u/s 80C of the Income Tax Act as available to a resident is also available to an NRI.
  • The income tax (TDS) rate is 1% of the value of the property if the value of the property bought is more than Rs 50 lac. The rate is higher if the seller of the property is also NRI. 
  • If NRI avails home loan to buy a property, the interest paid on loan is deductible from the taxable income.
  • In case NRI sells the Property, TDS is deducted at the rate of 20% on short term capital gains and 30% on the long term capital gains.

Repatriation of sale proceeds: 

The limit for repatriation of sale proceeds is US Dollars One million per financial year. The sale amount is deposited in NRO account and repatriated after payment of tax. For repatriation, the proper procedure of the bank is followed. If the amount exceeds the limit, the permission of RBI is required. 

Read More: FEMA – How it defines citizens

There are many factors existing today in India to lure the NRIs to invest in Indian property – all that one needs is due diligence and proper analysis.

The necessity of Legal Due Diligence in India

The necessity of Legal Due Diligence in India

Legal Due Diligence means taking all precautions to safeguard ones’ interest in a particular transaction. The transaction can be the sale of a property, buying a property, signing a contract etc. Its purpose is:

  • To identify the risks involved
  • To minimize those risks

The essence is to know the fact which one ought to know. It is presumed that a certain degree of prudence will be exercised for one’s own sake.

Read More: Selling a Property through a General Power of Attorney – Is it even valid?

How to carry out due diligence

It involves the collection of information and data that can influence the decision, like

  • Verify the credentials of the person or company involved in the transaction.
  • Handle the documentation part carefully. It is crucial to obtain legal advice (professionals/law firms) for proper documentation of complex transactions, especially property-related matters. It is necessary to read and understand the contents of the document.
  • Property transactions generally involve scrutiny of revenue records and search of title.
  • While dealing with a company, records maintained at the office of Registrar of Companies must be cross-checked. The financial health of the company also matters.
  • It is significant to know the reputation of the person or company as it exists. In the housing business, the image of the builder always has a substantial impact on the mind of the investors/buyers. It helps to ascertain whether the builder is making fake promises or is a genuine person.

Read More: Transfer of ancestral property and registration of transfer deed

Due Diligence has become significant nowadays:

Some of the reasons could be-

  • Adherence to Law is imperative. So far as the legal provisions or statutory requirements are concerned, the parties to the transaction must conform to the rules and regulations. It is the duty of the parties to take care that the statutory requirements have been complied with. For instance, a buyer must ensure that the builder has obtained the necessary approvals for constructing the residential flats.
  • There is an increase in the number of frauds in almost any business. In property matters, scams by impersonation and frauds by forging documents/title deeds, are prevalent. In such a scenario, some precaution will help to avoid the loss. Thus a particular standard of care is legitimately expected. For instance, in the case of buying a property, the buyer must ensure that the title is clear and the property is free from encumbrances.
  • Documentation is also another major area where the party needs to be attentive. There is an upsurge in forgery and frauds by impersonation. It becomes more important to carefully analyze the documents and ensure the authenticity of the same.
  • When a considerable amount is invested, the risk is higher, and one cannot afford to be negligent.
  • Some statutes require the exercise of due care. e.g. Transfer of Property Act. A duty is cast upon the buyer to make an effort to verify the essential facts about the property.
  • There are areas where it is mandatory to be vigilant. The consumer law and the law of contracts is based on the theory of “Caveat Emptor”. The buyer is expected to know the difference between latent and patent defects.  
  • Even the Courts in India, recognize the concept of due diligence for deciding the quantum of compensation. In cases where a party seeks compensation for the loss suffered in a transaction, the Courts are interested to know if the party has exercised due diligence and has tried to minimize its loss.

Read More: Sale deed: What you should know!

The extent of Due Diligence:

The amount of investigation required for collecting the relevant information and precautions to be taken for a transaction varies from case to case.

Selling a Property through a General Power of Attorney – Is it even valid?

Selling a Property through a General Power of Attorney – Is it even valid

Sale of property means transferring the title in the property for a sale consideration. The seller transfers the ownership rights in the property to the buyer. 

A sale deed is the primary legal document which evidences the sale of a property. The sale transaction is complete when the sale deed is executed and registered as per law. When the property is purchased through General Power of Attorney, the title over the property is not complete until the sale is duly registered.

What is a power of attorney? 

Power of Attorney is an authorization in writing given by a person (grantor/ donor/principal) to another person (attorney/agent) to act on his behalf. Principal confers authority on his agent to perform specified acts on his behalf. 

Read More: Checklist for selling property in India

PoA can be general or special. When power is granted for a particular task or limited purpose, it is special PoA. 

The General Power of Attorney is not specific. It contains broad authorization to perform a variety of tasks. It can be given to finalize the terms of the sale and to sign the deed on behalf of the buyer/seller.

Selling a property through GPA. 

In sale through GPA, the seller executes an agreement to sell vide which he confirms the receipt of payment and delivers the possession to the buyer.

  • Power of attorney is not a sale deed. It is merely an authorization. It is not a document conferring any title in the property. Nor any right or interest in the property is transferred to another person. 
  • If the property has been purchased through Power of Attorney, the title is not complete. The purchaser is not the owner legally. There has to be registered sale deed in existence for completing the transaction.

Read More: Selling property in India? Here are some reminders!

Sale of property by NRIs using General Power of Attorney

NRIs generally issue power of attorney to their Indian relatives, friends or family members. They cannot be present physically in India for all transactions.

In case of transfer of property by sale, an NRI must mention the reason for issuing the PoA. It must contain the relation of the NRI with the agent. The instrument authorizes the execution and registration of the sale deed to complete the sale transaction. The document itself is not a sale deed.

Why people use GPA to sell the property

  • People use it for sale of the property to evade stamp duty and registration fees.
  • General Power of Attorney is used to sell a property even if the title of the seller is not clear. 
  • In the case of agriculture land, if the property is to be sold for residential purpose, it has to be converted. The landowners sell this land using GPA without conversion.
  • To avoid payment of tax on capital gains earned on transfers.   
  • In the case of flats which are allotted on a leasehold basis, sale of flat is permissible only after the expiry of a specified period. Thus the transfer of unit through GPA is widespread as it is done before expiry of such period. 

Read More: Saving yourself from fraud while buying or selling a property

Do it the proper way:

All transactions through Power of Attorney holders are not wrong in law. Genuine transactions are permitted. POA is used to carry out the assigned tasks.   

In a sale transaction, the title gets transferred to the buyer only if the sale deed is executed and registered as per law. Registered sale deed ensures verification of the title and prevents dubious transactions.

General Power of Attorney is not a substitute for sale deed.

Transfer of ancestral property and registration of transfer deed

Transfer of ancestral property and registration of transfer deed - India

Transfer of immovable property results in the conveyance of property rights, i.e. title, rights, interest in the property by one person to another. 

The property can be transferred by the person having rights to do so. Generally, it is the owner of the property or the person authorized to do so. 

Any document showing the ownership of the property/land in the name of a person is a title deed. E.g. in case of sale of a property, sale deed is the title deed.

In the case of ancestral property, the ownership is verified from the record of the land registration department. 

What is the ancestral property?

Ancestral property is the property which has passed on up to four generations, including the owner, without any division. The coparceners (a small unit of lineal descendants of a common ancestor within the undivided Hindu family) have a birthright in the ancestral property.

Read More: Property rights of a wife after husband’s death

Only the Karta of the family (Karta is the head of the Hindu Undivided Family) has the right to alienate the HUF property which may include the ancestral property under certain conditions.

Property inherited from maternal ancestors or obtained by Gift, or Will is not ancestral property.

Whenever a person inherits an ancestral property, it is essential to get it transferred in the name of the beneficiary in revenue records or municipal records.

Modes of transfer and transfer deed:

There are various modes of transfer of immovable property like transfer by sale, gift, lease, and mortgage. The transfer takes place vide instrument called transfer deed. As per the nature of transfer, the deed can be sale deed, lease deed, mortgage deed etc.

Read More: Property rights of the second wife and her children

Transfer of ancestral land:

Ancestral land can also be transferred. The coparceners who have right over the ancestral property can transfer their respective shares or interest in the property. If the ancestral land is divided among the family members or there is a partition of the property, the property ceases to be ancestral. The share which each member gets after partition becomes the self-acquired property.

There can be a transfer of share or interest by coparcener (co-owner) without actual partition of entire ancestral land. In some parts of the land, consent of co-owners, i.e. the consent of other coparceners, is required. There are other areas where the consent of other coparceners is not needed.

A coparcener can also transfer his share to another coparcener. 

However, in any case, the transfer deed must be registered as per Law.

Registration of transfer deed:

The registration of transfer deed can be optional or mandatory as per the Indian Registration Act.

Read More: Property Rights of Women as per Hindu Law

 In some cases, it is mandatory like: 

  • sale of immovable property if the value of the property exceeds Rs 100
  • Lease of immovable property if the lease period is more than 11 months
  • Gift deed

If the registration is compulsory, the transfer is not valid if the deed is not registered. It is always better to get the transfer deed registered. The process of registration helps to:

  • Create evidence of ownership
  • Records the transaction-related to a property for future references

The transfer deed transfers the right or interest in the property to another person called transferee. For a valid transfer, the deed must be registered as per Law. The land registry, i.e. the department for registration records the ownership for the public. Once the document is registered as per Law, it becomes the title deed, i.e. document showing the name of the person holding the title of the property. 

The property rights are mentioned in the record maintained by the land registry department.

Read More: The married daughters’ right in mother’s self-acquired property