Tuesday, July 1, 2014

COMPULSORILY REGISTRABLE PROPERTY DOCUMENTS

Compulsorily Registrable Property Documents
All kinds of documents does not require compulsory registration. The Transfer of Property Act, 1882 and the Indian Registration Act, 1908 have made registration of certain documents compulsory while in respect of certain other documents it is optional.
The documents which relate to immovable property requires compulsory registration as per Sec 17 of Indian Registration Act 1902. Similarly according to Sec 54 of Transfer of Property Act 1882 registration of documents are necessary where the sale of immovable property the value of which is one hundred rupees or more.
It is implicit that registration of all sale deeds of immovable property is compulsory since no immovable property is available for rupees one hundred or less than rupees one hundred.
Compulsorily registerable Documents:
Section 17(1) of Indian Registration Act 1902, deals with the documents which require registration compulsorily.  They include:
1.         Instruments of gift of immovable property:
            Gift is given by the donor to the donee without any monetary consideration, but only in consideration of love and affection the donor has towards the donee.  Therefore, gift deeds transferring immovable property of the value of Rs. 100/- and above need registration.
3.    All non-testamentary documents which acknowledge the receipt or payment of any consideration on account of the transactions pertaining to the creation of any right, title, interest in the immovable property need registration.
4.         All non-testamentary documents transferring or assigning any decree or order, award of a court, which affect the right, title and interest in immovable property the value of which is one hundred rupees and above need registration.
Any right, title or interest in the immovable property may be created, extinguished, limited, assigned or declared by the document for the present or future but if the value of such immovable property is one hundred rupees or more, the deed needs to be registered.
Though all types of mortgages need registration, mortgage created by depositing of title deeds, known as equitable mortgage, is not compulsorily registerable. Mostly, banks and financial institutions use this mode of mortgage. However, memorandum of deposit of title deed needs registration.
According to Section 107 of Transfer of Property Act 1882, lease of immovable property from “year to year” or for any term exceeding one year or reserving a yearly rent must be done only by a registered instrument. The phrase from 'year to year', refers to a continuous lease from year to year, that is, where the landlord has no option to terminate the lease at the end of the year without notice.
Similarly the phrase, “reserving yearly rents” means that the lease has no definite period, but the annual rent is determined. The word “yearly” means that the lease should continue for more than a year or should run year after year.  In general, any lease in excess of one year and above should be registered.
There are certain documents which do not need compulsory registration Section 18 of the Indian Registration Act, 1908 lays down the instruments of which registration is optional and which includes the following:
a]         Instruments relating to transfer of an immovable property, the value of which is less than rupees one hundred;
b]         Lease of an immovable property for a term not exceeding one year;
c]         Wills
d]         Deed of gift of property valued at less than Rs. 100/-
Time limit for registration
Subject to certain exceptions any document other than a Will must be presented for registration within four months from the date of execution according to Sec 23 of the Registration Act. Execution means signing of the document. 
If the parties does not apply for registration within the prescribed time but still they can apply for registration to the Registrar who may direct, upon payment of a fine not exceeding ten times the actual registration fees, for registration of such a document [Sec. 25].  provided the delay does not exceed a further period of four months to the Registrar.
A document relating to an immovable property can be executed out of India and later it can be presented for registration in India. Under section 26 of the Registration Act, 1908, if a document purporting to have been executed by all or any of the parties out of India is presented for registration within theprescribed period of time, the Registering Officer may, on payment of properregistration fee accept such document for registration if he is satisfied thatthe instrument was executed out side India and the instrument has been presented for registration within four months after its arrival in India.
Enquiry by the Registering authority:
Section 34 of the Registration Act empowers or gives the right to the Registering Authority to enquire whether the person who applies for registration is the same who purports to have executed such a document. He may insist on some proof and if the person is found to be a representative or agent, then the Registrar may ask for relevant documents to show that the agent or representative has the right to appear on behalf of his principal.
Effect  of  non-registration:
What would be the repercussion if a document which is compulsorily registerable is not registered?
Section 49 of the Registration Act staes that the documents which are not registered cannot convey a valid legal title to the transferee and also not admissible as evidence for any transaction affecting the property referred to in the document. But there is an exception to this that the unregistered documents may be admitted as evidence in a suit for specific performance under Specific Relief Act.
Registration of documents acts as notice to the public and to protect themselves against the likely fraud. It is always advisable to get the documents registered whether mandatory or not as it is always beneficial and it creates a permanent record of event which are reflected in encumbrance certificates.

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