Kerala, with its lush landscapes and growing economy, offers attractive opportunities for land investment. Whether you’re buying your dream plot or selling a property, understanding the legal procedures is crucial to ensure a smooth and secure transaction. This guide provides a detailed overview of the steps involved in buying and selling land in Kerala, helping you navigate the process with confidence.
Key Documents for Land Transactions in Kerala
Before diving into the process, let’s familiarize ourselves with the essential documents:
- Title Deed (Aadharam): (ആധാരം – Aadharam) The most crucial document, proving ownership of the property.
- Encumbrance Certificate (EC): (എൻകംബ്രൻസ് സർട്ടിഫിക്കറ്റ് – Encumbrance Certificate) Shows any registered liabilities or claims on the property. You can obtain this online from the Kerala Registration Department website. It is generally taken for the last 13 years.
- Possession Certificate: (പൊസഷൻ സർട്ടിഫിക്കറ്റ് – Possession Certificate) Issued by the Village Officer, certifying the owner’s possession of the property.
- Basic Tax Receipt: (ബേസിക് ടാക്സ് റെസീത് – Basic Tax Receipt) Evidence of payment of land tax.
- Building Tax Receipt: (ബിൽഡിങ് ടാക്സ് റെസീത് – Building Tax Receipt) If a building exists on the land.
- Location Sketch: (ലൊക്കേഷൻ സ്കെച്ച് – Location Sketch) A sketch of the property and its surroundings, issued by the Village Officer.
- Non-Attachment Certificate: (നോൺ അറ്റാച്ച്മെന്റ് സർട്ടിഫിക്കറ്റ് – Non-Attachment Certificate) If there is a building on the land which is exempted from attachment from court proceedings.
- Thandaper Certificate: (തണ്ടപ്പേർ സർട്ടിഫിക്കറ്റ് – Thandaper Certificate) This document has the survey no of the land.
For Buyers: Step-by-Step Guide to Buying Land in Kerala
- Property Identification and Verification:
- Identify the right property: This goes without saying but do your research, consider location, future development prospects, and your budget.
- Verify ownership: Insist on seeing the original Title Deed (Aadharam – ആധാരം) and verify its authenticity with the Sub-Registrar’s Office (SRO).
- Obtain the Encumbrance Certificate (EC – എൻകംബ്രൻസ് സർട്ടിഫിക്കറ്റ്): This will reveal any existing loans, mortgages, or legal disputes on the property. Check for a minimum of 13 years, but 30 years is recommended.
- Check other essential documents: Examine the Possession Certificate (പൊസഷൻ സർട്ടിഫിക്കറ്റ്), Basic Tax Receipt (ബേസിക് ടാക്സ് റെസീത്), Building Tax Receipt (ബിൽഡിങ് ടാക്സ് റെസീത്) (if applicable), and Location Sketch (ലൊക്കേഷൻ സ്കെച്ച്).
- Conduct a site visit: Physically inspect the property, verify boundaries, and assess the surroundings.
- Legal Scrutiny and Due Diligence:
- Engage a lawyer: This is highly recommended. A lawyer specializing in property law can help you verify documents, conduct due diligence, and ensure the transaction is legally sound.
- Verify land records: Your lawyer can cross-check land records at the Village Office and the SRO to confirm ownership and identify any discrepancies.
- Check for legal clearances: Ensure the property has all necessary approvals, especially if you plan to construct a building.
- Agreement for Sale:
- Once satisfied, enter into a written Agreement for Sale with the seller. This agreement outlines the terms and conditions, including the sale price, payment schedule, and possession date.
- Pay a token advance: Typically, a small percentage of the sale price is paid as an advance when signing the agreement.
- Stamp and register the agreement (optional): While not mandatory, registering the Agreement for Sale provides legal protection to both parties. It should be on stamp paper and then signed by both parties and two witnesses.
- Payment and Sale Deed Execution:
- Make the full payment: Pay the remaining balance as per the agreed schedule.
- Draft the Sale Deed: The Sale Deed (ആധാരം – Aadharam) is the primary legal document transferring ownership. It should be drafted by a lawyer, mentioning all relevant details of the property, buyer, seller, and consideration.
- Payment of Stamp Duty and Registration Fee: Stamp duty and registration fees are payable to the government. These vary based on the property’s value.
- Execute the Sale Deed: Both the buyer and seller, along with two witnesses, must sign the Sale Deed (ആധാരം – Aadharam) in the presence of the Sub-Registrar.
- Registration of Sale Deed:
- The executed Sale Deed (ആധാരം – Aadharam) must be registered at the Sub-Registrar’s Office (SRO) having jurisdiction over the property.
- Submit the original Title Deed (Aadharam – ആധാരം), Encumbrance Certificate (EC – എൻകംബ്രൻസ് സർട്ടിഫിക്കറ്റ്), Possession Certificate (പൊസഷൻ സർട്ടിഫിക്കറ്റ്), Tax Receipts (ടാക്സ് റെസീതുകൾ – Tax Receipts), and other relevant documents along with the Sale Deed (ആധാരം – Aadharam).
- Mutation of Property:
- After registration, apply for mutation of property (പോക്കുവരവ് – Pokkuvaravu) at the Village Office. This updates the land records to reflect the new ownership.
- You’ll need to submit a copy of the registered Sale Deed (ആധാരം – Aadharam), an application form, and pay a nominal fee.
For Sellers: Step-by-Step Guide to Selling Land in Kerala
- Prepare Your Property:
- Gather all documents: Ensure you have the original Title Deed (Aadharam – ആധാരം), Encumbrance Certificate (EC – എൻകംബ്രൻസ് സർട്ടിഫിക്കറ്റ്), Possession Certificate (പൊസഷൻ സർട്ടിഫിക്കറ്റ്), Tax Receipts (ടാക്സ് റെസീതുകൾ – Tax Receipts), and other relevant documents.
- Clear any encumbrances: If there are any outstanding loans or dues on the property, clear them before proceeding with the sale.
- Determine the Fair Market Value:
- Research recent land transactions in your area to determine a fair market value for your property. You can consult with local real estate agents or property valuers.
- Find a Buyer:
- You can market your property through various channels, such as online portals, real estate agents, or local newspapers.
- Agreement for Sale:
- Once you’ve found a buyer and agreed on the terms, sign a written Agreement for Sale.
- Receive a token advance: Collect an advance payment from the buyer.
- Sale Deed Execution and Registration:
- Draft the Sale Deed: Have your lawyer draft the Sale Deed (ആധാരം – Aadharam).
- Receive full payment: Ensure you receive the full payment before executing the Sale Deed (ആധാരം – Aadharam).
- Execute and register the Sale Deed: Follow the same procedure as outlined for buyers (Steps 4, 5 & 6).
Important Considerations:
- Fair Value and Circle Rate: The government fixes a “fair value” for land in different areas. Stamp duty and registration fees are calculated based on the declared sale value or the fair value, whichever is higher.
- Capital Gains Tax: Sellers are liable to pay capital gains tax on the profit made from the sale of land.
- NRI Buyers/Sellers: There are specific regulations and procedures for Non-Resident Indians (NRIs) buying or selling property in India.
Conclusion:
Buying or selling land in Kerala involves a series of legal procedures designed to protect both parties. By understanding these steps, gathering the necessary documents, and seeking professional legal assistance, you can ensure a smooth and secure transaction. Remember, due diligence and careful adherence to legal formalities are essential to avoid any future complications.
Disclaimer: This blog post is for informational purposes only and should not be considered legal advice. It is crucial to consult with a qualified legal professional for guidance tailored to your specific situation.
