Corona crisis and stay at home – check your property documentation!

Corona crisis and stay at home - check your property documentation

Did you ever think that in the 21st century, there would be a time when the whole world would have to battle a tiny virus that holds the entire universe hostage?

As you stay safe and protected within the four walls of your homes, do pause and spend some time taking stock of whether your documentation of property affairs is up to the mark or not.

Whether Corona persists for a few weeks or holds us under threat for a few months, remember – your assets will stay yours only if you are particular about the detailed documents and other aspects.

Therefore in this time that you stay at home – whether you are working or not – please spend some time going through all your property documents to ensure that they are complete and credible.

Meanwhile, even in this crisis, NRI Legal Services remains connected and open to all its clients – existing and potential.

As a global legal management firm, handling crucial property matters we are constantly aware of the responsibility we have towards our clients across the world.

We have an exceptional record of delivering legal services for issues related to the immovable and moveable assets of NRIs. Besides providing justice to NRIs who are facing problems in property legal issues, it is our endeavour to reinstate faith in people residing overseas.

Our competent team of lawyers is capable of providing consultation to clients. All legal advice is given after complete reviews of all documents. An exceptional communication service network is used to give legal advice to clients.

NRI legal services step forward to provide a range of services to resolve issues related to the following – Title Search, Partition of Property, Transfer of Property, Banking And Finance matters and Tax Matters. Besides these, we can help you find solutions to any matter related to Succession Certificate, Adverse Possession, Landlord Tenant disputes and Real Estate Services.

We would suggest that all the time that you are now getting to be at home should also be used to sort out your personal and official documents. Topmost priority has to be your documentation on property.

Ask yourself – are all ‘Will’ related matters sorted out? Do you anticipate any issues regarding the partition of property in your family?

Do ensure that transfer papers and succession certificate complications are kept into consideration and you are aware of what the procedures are.

Our teams are working round the clock across various cities, well connected and in sync with each other to resolve all your queries and issues.

NRI Legal Services – at your service, all the time and through all crisis. Trust us to be there to make your life easier and smoother.

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Property rights of a son on mother’s self-earned property – Issues and the Law

Property rights of a son on mother’s self-earned property

There has been such a massive change in the social milieu in our country that now issues arise regarding a mother’s property too – reflective of the fact that women have shares in the family property now.

In further lines of succession of property owned by a woman, a son can claim a share in his mother’s self-earned property only if the mother wants. But if the mother dies intestate, the issue of claim arises.

Distribution of property among family members of the deceased when the person has died intestate has always been a challenging task.  The issue becomes more complicated when the property consists of both ancestral and self-earned property.

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

Self-earned or Self-acquired property refers to the property:

  • made by a person by his resources or
  • which he has inherited under the law of succession or
  • acquired through Will or
  • which has come to him after partition.

How an individual deals with self-earned property:

  • The Law gives an individual the full right to deal with the self-earned property in any manner that he pleases; whether it is transferring the property by way of gift, sale or a Will.
  • A person can dispose of the self-earned property to the exclusion of his heirs. The entire property can be gifted to a third person/stranger.
  • No legal heir can claim any right over the said property till the time the owner of the property is alive.
  • The legal heirs can exert their right only if the owner dies intestate.

Personal and Statutory Laws governing property rights:

The right of the children in the property of their mother largely depends upon the personal law and statutory law governing such rights.

In India, the personal laws are related mostly to the religion of the person.  For Hindus, Muslims and persons of other faiths, there are different personal laws.

Under Hindu Law, a woman is the absolute owner of the property which she acquires by any means: gift, will, inheritance. This property becomes her self- acquired/self-earned property. She can choose to transfer the entire property to any person other than her husband and her children.

Also Read: Gift Deed- Implications, Interpretations and Information

Can a son claim on the self-earned property of his mother?

During the lifetime of the mother, a son cannot claim any share in her self-acquired property.  

However, if a Hindu female (mother) dies intestate, the property devolves among legal heirs as per the provisions of the Hindu Succession Act. The legal heirs are

  • Sons Daughters (if predeceased, their children) Husband

The children and husband of the deceased woman (mother) have equal inheritance rights.  Other legal heirs follow if the first order is missing, i.e. a woman dies leaving no children, no grandchildren and no husband, then the legal heirs are:-

  • Mother and father
  • Heirs of father
  • Heirs of mother

In the case of Hindus,

  • A son can, therefore, claim a right in the self-earned property of his mother if the mother has died intestate.
  • Both son and daughter have equal rights.
  • Even the share of ancestral property falling to the mother after the partition of the property becomes her absolute property and is treated as her self- acquired property.

For Muslim mothers,

  • It is the personal laws which govern the right of her son in the self-earned property.
  • Under Muslim law also, a woman becomes the absolute owner of the property which she has acquired by any means.
  • Generally, there is no distinction like the ancestral or self-acquired property under Muslim Law.
  • The children of a Muslim mother cannot claim any right during her lifetime.  Inheritance opens only on the death of the person.

Also Read: Can NRIs buy property jointly with resident Indian?

For persons of other faiths, the right of the children in the property of the mother is governed by the Indian Succession Act. The relatives of the woman and her children are given preference over her husband and his relatives.

The issue of a son’s claim would therefore largely depend on the personal laws governing that particular segment and the line of succession.

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Can NRIs buy property jointly with resident Indian?

Joint Property - Can NRIs buy property jointly with resident Indian

Some things in this world are still going fine jointly! Take property ownership in India, for instance – especially when we live in a country where the property is still one of the most coveted ways to connect with your roots.

For NRIs, purchasing a property in India is much more than an investment opportunity. It is a way of seeking connections to the native place – and also to find a ‘home’ for oneself. 

It helps if the property ownership is joint with a known relative or friend who is a resident Indian. 

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

What do you keep in mind while buying property jointly?

  • As with other things, the purchase of property by NRIs in India is also governed by guidelines issued by RBI. 
  • While the RBI has issued General guidelines for purchase of property by NRIs also, in some cases, special permission from RBI or approval from Government is required before making an investment in the immovable property by NRI.
  • RBI allows NRIs to jointly own a property with another NRI or a resident Indian. 
  • However, in cases where the resident Indian is otherwise ineligible to buy property, then the NRI will also not be allowed to buy the property with that resident Indian (irrespective of the financial contribution of the other person). 

Remember:

  • Residences or commercial property can be bought by NRIs freely. 
  • There is no restriction on the number of properties that can be purchased. 
  • There is no requirement of obtaining any specific permission in such cases and also no need to send any information to RBI for this purchase. 
  • There is no need to file any document with RBI in this regard. 
  • In case the interested NRI is unable to come to India for completing the property purchase, the same process can be carried out by giving a special POA (Power of Attorney) to another person. 

But,

  • For the purchase of any agricultural property or a farmhouse or plantation, NRIs need to apply for specific permission from RBI. 
  • However, NRIs can inherit the same from any resident Indian.

Read: Transfer of Property on the basis of Registered or Unregistered Will

What does the FEMA say?

  • There are no specific guidelines under FEMA for purchase of property by NRI jointly with resident Indians.  
  • An NRI is allowed to sell or gift any immovable property to any resident Indian. 
  • Any property can be gifted to NRI by an NRI other than agricultural property, plantation or a farmhouse.
  • The restrictions which apply to NRIs for purchase of agricultural property, farmhouse or plantation continue even if it is a joint purchase.  
  • The transactions have to be routed through proper banking channels under FEMA and RBI guidelines.
  • For all purposes of investment in real estate, NRIs are treated at par with the PIOs.

Read: How to obtain probate of a Will

What if a person becomes an NRI after buying property in India?

  • In case an individual has bought property in India and acquires an NRI status after that, he can continue holding the property
  • All taxes will apply to the property as per the laws of the country

So Yes! Relax NRIs – You CAN buy property jointly with resident Indians or other NRIs. Make sure you adhere to RBI and FEMA rules regarding the same. 

Saving yourself from fraud while buying or selling a property

Saving Yourself From Fraud While Buying or Selling A Property

It is a bitter fact that there is an occurrence of frauds while buying or selling the property. Misinformation or Ignorance or lack of information on procedures and documentation is the main cause.  However, one can easily avoid these complications. 

Some of such common frauds are:

Imperfect Title – For a buyer, it is significant to ensure that the seller has a clean title and can transfer the ownership rights in the property to the buyer. The title should be free from defects. The imperfect title means there is any encumbrance on the property or the property is disputed.

Multiple mortgages: The seller has mortgaged the house to different banks before selling the same.

Read More: How to obtain probate of a Will

Delayed possession by developers – In case of buying house/flat constructed by a builder, possession of the flat is often delayed. The buyer’s money gets blocked.   

Building not as per the approved plan– The builder does not construct the building as per the sanctioned plan. Necessary approvals from the Government are not taken. The property is not as per the description/advertisement. Sometimes the location of the property may also differ.

Fake Documents– There is also a practice of preparing fake title deeds. Either the signatures are forged or the document (property document) is not valid i.e. proper stamp duty not paid or document not registered as required.

Fraud by Impersonation: The person presenting himself as the owner of the property is not the actual owner. The documents are signed forging the signatures of the actual owner.

Home equity frauds– In simple words, home equity frauds means a fraud where the fraudster hacks the information about the true owner and reroutes the loan amount to his account by forging the signatures of the actual owner.

Read More: Transfer of Property on the basis of Registered or Unregistered Will

Misuse of power of attorney: A POA granted to execute a sale deed can be misused. It is better to get the same verified from a lawyer to avoid any dispute later.

How to avoid them:

Information and knowledge is the key to avoid any property related frauds. Some steps can be:

To verify the Credentials of the developer/builder:

If the builder/company is reputed, it can help to ensure that necessary approvals have been taken and promises made are not fake. Possession will not be delayed as the developer has maintained a good track record.

Checking the revenue records:

There is a mention of the lien/mortgage over the property in the revenue records. The same can be verified to ensure that property is free from encumbrances and title is clear.

Buying a resale property:

Collect the encumbrance certificate from the office of the Sub Registrar as it helps to verify that the title is clear. EC also contains the name of the previous owner. Also, check the tax payslips. Try to verify that all dues have been paid.

Read More: How to file a partition suit for a property in India

Buying a house in a society:

Check that the society is registered and there is a resident welfare association in place.

Buying a house from a builder:  

It is better to check that the project is registered with RERA. It helps to ascertain that all necessary approvals are in place and construction is as per norms. Moreover, possession will be granted as per promise.

From Seller’s point of view certain precautions are:

  • Buyers generally ask for original ownership documents. Sellers must possess the same
  • Seller must have Approved building plan or occupation certificate from the local authorities
  • Sellers must ascertain the identity of the buyers especially if the buyer is executing the conveyance deed using a power of attorney
  • Proper valuation of the property to quote the correct price

Taking legal advice:

Property transactions are complex. To avoid the occurrence of fraud, the parties must take legal advice and ensure proper documentation.

 Investment in the property must be taken seriously. The casual approach may land you in trouble.

What is mutation of property and why it is important for buyers?

What is mutation of property & why it is important for buyers

From a buyer’s point of view, it is imperative that the property he intends to buy has a clear and undisputed title. The onus to verify the title of the property is on the buyer. It requires well-maintained land record/municipal records where all the past transactions related to the property title are duly recorded. It is possible if mutation is done diligently.

There are certain documents which establish property ownership:

  • Registered documents transferring the title, e.g. sale deed
  • Survey documents
  • Land records
  • Property tax receipts

Apart from the registration of documents, there is mutation also, which reveals the owner of the property. Registration is a proof of ownership, but mutation is essential as it records the ownership with the authorities.

What is mutation?

Mutation means entering the name of the owner of the property in the revenue records maintained at the local level by the State. Whenever a property is transferred,i.e. there is a change in the ownership, the name of the new title holder is reflected in the revenue records when mutation is done.

The Government maintains the record as the same enables the authorities to tax thereal property owner.

When is mutation required?

Mutation is required whenever there is a change in ownership effected by:

Is it necessary to get the mutation done?

There are two types of mutation:

  • Mutation of agriculture land
  • Mutation of non– agriculture land

In case of agriculture land, mutation is necessary as the title passes to the new owner, only after mutation. If the Government acquires such land, the compensation is paid only to the person who is the owner as per land revenuerecord.

In case of non-agriculture land, the title of the owner is not affected if mutation isnot done. However, for payment of municipal tax, electricity connection, waterconnection, mutation becomes necessary.

How is mutation done?

An application is made to the Tehsildar with court fee stamp affixed on it. The documentation and fee for mutation differ from State to State.

What is the importance of mutation, especially for a buyer?

Since the onus to verify the title of the property is on the buyer, mutation is of greatsignificance to him. It is essential to get the mutation done because:

  • The Government looks into the land records to verify the actual owner for imposing taxes and for awarding compensation.
  • Mutation shows possession of the property.
  • Mutation is vital for further sale of the property.
  • Mutation helps to prevent the fraudulentsale by seller to more than one buyer.
  • Mutation helps the buyer to ascertain that the property is free from    encumbrances or if there is any liabilityto be incurred by him. 

However, mere mutation does not confer any title. Mutation is invalid if the document transferring the title is not registered as required in law.

It is important to note that mutation is not a onetime process. It needs to be doneregularly to ensure that the property record is clear.

It is always advisable to take legal help from lawyers to effect any transfer of property to avoid legal ramifications later and to ensure that all legal formalities are complied with. Lawyers can provide legal advice and assistance in case of mutation or for cross-checking the revenue records in case of purchase/sale of any property.