Is your property registered?
Will the recent Supreme Court ruling on owning property sans a signed and stamped sale deed impact the market?
In a judgment that will impact both freehold and leasehold transactions, the Supreme Court has ruled that immoveable property can be lawfully transferred only through a registered deed of conveyance.
“Transfer of immoveable property by way of sale can only be by a deed of conveyance (sale deed). In the absence of a deed of conveyance (duly stamped and registered as required by law), no right, title or interest in an immoveable property can be transferred,” the apex court has held.
It noted that property transactions through GPA (general power of attorney) were “evolved to avoid prohibitions/conditions regarding certain transfers, to avoid payment of capital gains on transfers, to invest unaccounted money and to avoid payment of unearned increases due to development authorities on transfer.”
The judgment will not harm past transactions. So, how will it impact those who have already bought property through GPA so far? According to Sunil Tyagi, senior partner, ZEUS Law Associates: “The judgment is prospective and will not affect past transactions. What has been held not permissible is sale of immovable property by way of agreement to sell (ATS), GPA and Will to avoid payment of stamp duty or to evade permissions that may be required for certain kinds of sales.”
However, a sale deed executed by an attorney holding validly and legally executed power of attorney has not been ruled out. The court has observed that merely on the basis of ATS, GPA, will, etc, a person does not become owner of a property in the absence of duly stamped and registered sale deed.