logo logo

COMPULSORILY REGISTERABLE PROPERTY DOCUMENTS

All documents do not require registration compulsorily. 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.

According to section 17 of the Indian Registration Act, 1908 registration of documents is compulsory if they relate to an immovable property. Similarly, Section 54 of Transfer of Property Act 1882, stipulates that sale of immovable property the value of which is one hundred rupees or more should be registered. Since no immovable property is available for rupees one hundred or less than rupees one hundred, implicitly all sale deeds of immovable property need compulsory registration.

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 mRs.100/- and above needs registration.

2. Other non-testamentary documents which purport to create, assign, limit or extinguish the right, title and interest in immovable property the value of which is more than one hundred rupees.

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.

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.

The documents may create, extinguish, assign, declare, limit or restrict the right, title and interest in the immovable property 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.

Section 107 of Transfer of Property Act 1882, prescribes that 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 run year after year or at least more than a year. In general, any lease in excess of one year and above should be registered.

Documents where registration is optional:

There are certain documents registration of which is optional. Section 18 of the Indian Registration Act, 1908 lays down the instruments of which registration is optional. They include:

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:

Under Section 23 of the Registration Act, subject to certain exceptions, any document other than a will has to be presented for registration within four months from the date of its execution. Execution means signing of the document. If a document is not presented for registration within the prescribed period of four months and the delay in presentation of the document does not exceed a further period of four months, then the parties can apply to the Registrar for registration of the document who may direct, upon payment of a fine not exceeding ten times the actual registration fees, for registration of such a document [Sec.25].

A document relating to an immovable property can be executed out of India and later it can be presented for registration in India. As per 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 the prescribed period of time, the Registering Officer may, on payment of proper registration fee accept such document for registration if he is satisfied that the instrument was executed out of India and the instrument has been presented for registration within four months after its arrival in India.

Enquiry by the Registering authority:

The Registering Officer is empowered under sec. 34 of the Registration Act to enquire whether or not the person is the same by whom it purports to have been executed such a document. He may insist on production of proof for his identity and in case any person is appearing as a representative or agent, 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 Indian Registration Act deals with this situation. It states clearly that such un-registered documents do not convey to the transferee a legally valid title and such documents are not admitted as evidence for any transaction affecting the property referred to in the document. However, there is an exception provided in the Act. The unregistered documents may be admitted as evidence in a suit for specific performance under Specific Relief Act or as evidence for part performance of the contract as per Section 53A of Transfer of Property Act 1882 or in any other related transaction, not required to be effected under a registered instrument.

Documents are mainly registered for conservation of evidence, assurance of title, and to help an intending purchaser to know if the title deeds of a particular property have been deposited with any financial institution or person for purpose of obtaining loan or advance against security of the property. Registration of documents acts as notice to the public and to protect oneself against the likely fraud. Therefore, it is advisable to register all documents connected with the immovable property irrespective of whether the registration is compulsory or not as it creates a permanent record of event which are reflected in encumbrance certificates.

As registered documents have higher value of evidence than unregistered documents it is always beneficial to you if you get all your property documents registered within the stipulated period irrespective of the fact that such registration is mandatory or not.

Registration of any document acts as notice to the public. But the registration of all the documents is not compulsory. The Transfer of Property Act 1882, the Indian Registration Act 1902 have made the registration of certain documents compulsory, and others optional.

Section 54 of Transfer of Property Act 1882, stipulates that sale of immovable property value of which is one hundred rupees or more should be registered. If the value of immovable property is less than one hundred rupees, the registration of sale deed is not mandatory. But this is only of academic interest, since, the value of any immovable property will be generally more than one hundred rupees. Even the value is less than one hundred rupees it is advisable that the deed be registered.

Section 107 of Transfer of Property Act 1882, prescribes that lease of immovable property from "year to year" or for a term exceeding one year or reserving a yearly rent must be done only by registration. 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 run year after year or atleast more than a year. In general, any lease in excess of year and above should be registered. Section 17 of Indian Registration Act 1902, deals with the documents which require registration compulsorily.

1. A document of gift of immovable property: Gift, as everybody knows, is given in consideration of love and affection and no monetary consideration is involved. So any gift deed irrespective of the value of the gifted property needs registration.

2. All non-testamentary documents:

a) Which create an interest, right or title in immovable property the value of which is more than one hundred rupees.

b) Which extinguishes (cancels) any right, interest or title in the immovable property value of which is one hundred rupees or more for present or future.

c) Which declare, assign, limit or restrict the interest, title and right in immovable property, value of which is one hundred rupees or more.

3. All non-testamentary documents which acknowledge the receipt or payment of any consideration on account of the transactions pertaining to right, title, interest in the immovable property.

4. All non-testamentary documents transferring or assigning any decree or order, award of a court, which affect the interest, rights and title in an immovable property the value of which is one hundred rupees and above.

The documents may create, extinguish, assign, declare, limit or restrict the interest, right or title in the immovable property for the present or for future, but if the value of such immovable property is one hundred rupees or more, the deed need to be registered.

Though all types of mortgages needs registrations, the mortgages created by depositing of title deeds, called as equitable mortgage, is not compulsorily registerable. Mostly, banks and financial institutions use this mode of mortgages. However, memorandum of deposit of title deed should be registered

Testamentary means, relating to the WILL and non-testamentary means documents not connected with WILL. The WILL is a document which states that who has to succeed to the assets properties of the person who writes the WILL (testator) after his death. WILL is not compulsorily registerable, but it is advisable to get it registered

Indian Registration Act empowers the State Government to exempt registration of any document of lease the period of which does not exceed five years and annual rent does not exceed fifty rupees.

The important point is what is the effect if the document, which is compulsorily registerable, is not registered, Section 49 of Indian Registration Act deals with this situation. It states clearly that such non-registered documents do not convey transfer legally valid title to the transferee and such documents are not admitted as evidence of any transaction affecting the property referred in the document. Thus, the purchaser will not get legally valid title by a unregistered sale deed.

However, it also provides an exception, that such unregistered documents may be received as evidence in a suit for a specific performance under Specific Relief Act or as evidence of part performance of the contract as per Section 53A of Transfer of Property Act 1882 or in any other related transaction, not required to be affected by a registered instrument. It is always advisable to register any document connected with immovable property as it creates a permanent record, which are reflected in encumbrance certificates. Further such registered documents have higher value of evidence than unregistered documents.