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Jeevan (None)     23 May 2012

Buying unregistered flat

Hi,
I am buying one apartment flat in Bangalore. The scenarios are the following:
1. The builder has gone into an sale agreement of the said flat with Party A when the property was under construction. This agreement between the builder and Party A has been signed on a stamp paper but has not been registered.
2. Party A has paid all the dues and now wants to sell this flat before registering and I am willing to buy this flat
3. The builder, myself and party A has gone into an Assignment agreement where the Party A has agreed to assign all his rights to me and builder has agreed to register that property directly to to me. This assignment deed has been signed on a stamp paper with 0.1% of the sell value but has not been registered.
4. The builder wants to add the following paragraph in the final deed that will get registered and get PARTY A's special power of attorney holder to sign as a witness during registration

"WHEREAS the VENDOR has executed an Agreement of Sale dated xx-xx-2008, in favour of PARTY A, to purchase the Schedule Property, due to change in circumstances they have entered into an Assignment Deed on xx-xx-2012 with the PURCHASERS herein. They have given their consent for the sale of the above mentioned flat by the VENDOR to the PURCHASERS herein and the VENDOR has made PARTY A as consenting witness to this Sale Deed herein. "

Now my questions are:

  1. Whether it is really needed to include the assignment deed and original sell agreement details in the final deed, particularly when these are not registered?
  2. As this would create a reference of unregistered deeds related to immovable properties,  can these potentially create any issue to get the mutation/khata transfer done in future
  3. What could be the future problems if we dont mention the assignment deed and original sell agreement details in the final deed. More so as there is no record of these documents and the originals of both of them would be with me.

You responses would be really helpful to me.


Thanks,
Jeevan



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 2 Replies

S Jadhav 98336 98330 (Jadhav & Associates)     23 May 2012

The better route would be as you yourself have suggested - You may directly purchase the flat from the builder directly. But the problem will be that the money has to be paid to the person who is selling it. Since you will be paying monies to the seller then how ill you complete this transaction unless the builder repays all monies to the earlier purchaser and cancels the sale and the make a sale to you. The builder will have issues about this so he is going to to let the issues be with your purchase transaction and sale deed. Hence it is always advisable to buy a flat with less complex history but it is not always possible to do so. If you mention the earlier sale and the assignment, you will have to bear the consequences e.g. you may be asked to pay stamp duty on the earlier sale deed. It is an offense to not pay stamp duty and register an agreement related to immovable property. Hence, the next best route will be to ask the earlier buyer to pay stamp duty and register the deed and then buy the flat from him. But the earlier buyer will not do so as he will lose money (legally required to be done) So this is an illegal act that you are knowingly asserting to and entering the transaction. S Jadhav
1 Like

Jeevan (None)     23 May 2012

Thanks for your suggestion. However, I have one related question ... assuming that we mention this paragraph then as I understand 2 things can happen:
1. I may be asked to pay the stamp duties for previous agreements as mentioned in the above para and I pay them and get it registered
2. the register may register it without asking for previous stamp duty and I pay what ever has been asked for

In either case once this deed is registered then there is no future problems ... right?

Regards,
Jeevan


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