The Registration Act, 1908 deals with the enactments relating to the
registration of documents. The Act was implemented to provide discipline and
public notice concerning transactions in relation to immovable property.
The term "immovable property" has been defined in various central acts, but no
such act categorically defines the term. The most significant act dealing with
immovable property is the Transfer of Property Act, 1882. Under this Act the
term "immovable property" is defined as the property that does not include
timber, growing crops, or grass.
Section 3(26) of the General Clauses Act, 1897 defines immovable property as the
property that shall include land, benefits to arise out of land, and things
attached to the earth or permanently fastened to anything attached to the earth.
Section 2(6) of the Indian Registration Act, 1908 defines it as property that
includes land, buildings, hereditary allowances, rights to ways, lights,
ferries, fisheries, or any other benefit to arise out of land, and things
attached to the earth or permanently fastened to anything attached to the earth,
but not standing timber, growing crops nor grass.
Things that can be extracted or detached from the earth are considered as
movable property and not immovable. Therefore, wild crops, plants, trees, grass,
etc., are considered as immovable till they are attached to the ground. Once
they're removed or detached, they become movable property. Thus, a property that
can't be moved from one place to another is immovable property.
The sale of an immovable property for a value exceeding Rs 100 then such
property has to be registered.
There are various laws related to property in
India such as:
- The Transfer of Property Act, 1882
- The Indian Easements Act, 1882
- The Registration Act, 1908
- The Indian Stamp Act, 1889
- The Real Estate (Regulation and Development) Act, 2016 (RERA), etc.
Registration is the procedure through which all the documents are recorded by a
recognized officer along with other necessary information to ensure its
transparency and authenticity.
Registration of documents is important as it acts as a valid proof and aids a
person in taking a legal action during any dispute. It's easier to find out if
there's any impediment or ongoing litigation with regard to a property if the
document is registered. The Act provides for mandatory registration of certain
documents to protect them from any type of fraud.
Mandatory Registration of Documents under Section 17 of the Registration Act
Section 17 of the Act provides for mandatory registration of certain documents:
- instruments of gift of immovable property;
- other non-testamentary instruments which purport or operate to create,
declare, assign, limit or extinguish, whether in present or in future, any
right, title or interest, whether vested or contingent, of the value of one
hundred rupees and upwards, to or in immovable property;
- non-testamentary instruments which acknowledge the receipt or payment of
any consideration on account of the creation, declaration, assignment,
limitation or extinction of any such right, title or interest; and
- leases of immovable property from year to year, or for any term
exceeding one year, or reserving a yearly rent;
- 1 [(e) non-testamentary instruments transferring or assigning any decree or
order of a Court or any award when such decree or order or award purports or
operates to create, declare, assign, limit or extinguish, whether in present or
in future, any right, title or interest, whether vested or contingent, of the
value of one hundred rupees and upwards, to or in immovable property:] Provided
that the 2 [State Government] may, by order published in the 3 [Official
Gazette], exempt from the operation of this sub-section any lease executed in
any district, or part of a district, the terms granted by which do not exceed
five years and the annual rents reserved by which do not exceed fifty rupees.
Optional Registration of Documents under Section 18 of the Registration Act
Section 18 of this Act deals with optional registration of documents.
The
following documents that may be registered under this Act:
- Adoption Deed
- Instruments related to share in Joint Stock company
- Debenture issued by Joint Stock Company
- Endorsement upon or Transfer of Debenture, which is issued by Joint Stock Company
- Decree or order of the court involving creation, declaration, assignment and extinguishment of any right, title or interest in an immovable property of value less than one hundred rupees
- Document of Past transaction
- Wills
- Grant of immovable property by the Government
- Instrument of Collateral Security
- Power of Attorney
- Agreement to Sell
- Agreement of Mortgage
- Certificate of Sale
- Counterpart of Lease
- Promissory Note
- Leases of immovable property not exceeding one year and leases excluded under section 17 of the Act
When the Documents can be Registered?
As per section 23 of the Act no documents except will shall be allowed for
registration unless it's presented within four months from the date of its
execution. If the document is executed by several persons at different times,
then such document has to be furnished for registration and re-registration
within four months from the date of each execution which comes under Section 24
of the Registration Act.
Section 25 of the Act specifies that if any document executed or decree made is
not presented for registration within the prescribed time period due to any
unavoidable accident or urgent necessity then the registrar may direct to
present such document for registration within four months with a payment of fine
not exceeding ten times the amount of registration fees. An application must be
made to the sub-registrar who shall forward it to the Registrar to whom he is
the subordinate.
And Section 26 of the Act states that if a document, has been executed by any of
the parties outside India for registration after the expiry of the given time
period, then such document must be presented to the Registering Officer for
registration within four months after its arrival in India.
Where the Registration of Documents can be Done?
As per Section 28 of the Act all the documents which are related to immovable
property must be presented for registration in the Sub registrar's Office within
whose sub-district the whole or part of the property is situated. The authorised
signatories for the seller and the buyer have to be present along with two
witnesses, for registration of the documents. The officer may on special
circumstances attend at the residence of any person who desires to deposit a
will or present a document for registration under Section 31 of the Act.
Duties of Registering Officers when the Documents are Presented
Section 52 of the Indian Registration Act specifies:
- *
- The day, hour and place of presentation, 1[the photographs and finger
prints affixed under section 32A,] and the signature of every person
presenting a document for registration, shall be endorsed on every such
document at the time of presenting it;
- a receipt for such document shall be given by the registering officer to
the person presenting the same; and
- subject to the, provisions contained in section 62, every document
admitted to registration shall without unnecessary delay be copied in the
book appropriated therefore according to the order of its admission.
- All such books shall be authenticated at such intervals and in such
manner as is from time to time prescribed by the Inspector-General.
Who can Apply for Registration?
As per Section 32 of the Act all documents that are to be registered under this
Act must be presented at the proper registration office by:
- A person executing or claiming under the same or in case of a copy of a
decree or order, claiming under the decree or order;
- Representative of that person;
- Representative or assignee of such person who's authorized by power of
attorney executed and authenticated in manner hereinafter mentioned.
The one presenting a document shall affix his passport size photograph and
fingerprints to the document(s) provided that it's in relation to transfer of
ownership of immovable property. Photographs and fingerprints of both buyer and
seller of the property must be mentioned in the document(s).
A will or authority presented by the testator or the donor for registration
shall be registered in the same manner as any other document provided that:
- The will was executed by the testator or donor,
- The testator or donor is dead,
- The person presenting the will or authority under Section 40 of the Act
is permitted to present the same.
Stamp Duty and Registration Fees
Section 80 of the Act states that the required amount of fees must be paid while
presenting the documents. More than buying a property, registering it can be
taxing. If you are planning on buying a property, it's important to remember
that the amount quoted to you by the seller is not the final or only price you
have to pay. Easily, few lakhs get added to the price quoted to you when you
register it on your name. There are charges concerning stamp duty and
registration, cess, and surcharges when you pick a property.
Yes, all the charges put together can come up to 7% to 10% of the total market
value of the property or more than that. In most states in India, the cost of
stamp duty is generally 5% to 7% of the total market value of the property while
1% of the property's market value is charged as registration fee. However, for
other states local laws will prevail.
There are Stamp Duty and Registration Charges in Different Cities across India
such as in Bangalore the stamp duty charges 2% to 5%, in Delhi 4% to 6%, in
Gujarat 4.9%, etc. The fee varies from state to state. Stamp duty charges are
determined by certain factors like age of the property, age of the owner, gender
of the owner, purpose, location, etc.
Procedure for Payment of Stamp Duty and Registration Charges
Stamp duty charges can be paid in the following ways:
- Franking
- Physical stamp paper
- E-stamping
All states won't have all such methods. In case all such ways are available,
you can prefer the method which is suitable for you.
Consequences of Non-Registration of Certain Documents
Section 49 of this act states that:
No document required to be registered under section 17 of this Act shall be
valid for creation, operation, declaration, limitation and assignment of any
right, title or interest in any immovable property unless it's registered within
the specified period of time.
The document shall not confer any power or right to adopt.
The document cannot be received as an evidence of any transaction affecting such
property or conferring such power. Therefore, if there's a failure to register
the property then there will be no consideration of evidentiary value of such
document(s) in court.
Case Laws:
Tek Bahadur Bhujil V. Debi Singh Bhujil
In the case of Tek Bahadur Bhujil V. Debi Singh Bhujil AIR 1966 SC 292, it was
held that where a document concerning family arrangement is made in writing with
the purpose of using it as a proof then such a document would require mandatory
registration as the document would amount to document of title declaring for
future the various rights or claims or properties each member of the family
would acquire and enjoy.
Hansia V. Bakhtawarmal
In the case of Hansia V. Bakhtawarmal, AIR 1958 Raj 102 the issue that arose in
this case was how far a non-registered document that needed mandatory
registration under Section 17 of Indian Registration Act can be used in the
proceeding. The document in question was a mortgage deed that was not
registered. It was observed that a suit for recovery based on an unregistered
mortgage deed is bound to fall because the purpose of the mortgage deed is to
prove the mortgage. The unregistered mortgage deed can only be used for
collateral purposes as per Section 49 of the Registration Act.
Bhoop Singh V. Ram Singh Major
It was decided in this case that if a decree is issued about some immovable
property which isn't the subject of the suit, then the decree will be subjected
to compulsory registration.
For instance, if a suit is filed in respect of property 'A,' but the decree is
in respect of immovable property 'B,' then the decree will require compulsory
registration insofar as it relates to immovable property 'B,' as per section
17(2) (vi) of the Registration Act, 1908.
Conclusion
Registration of documents plays a vital role in preventing property disputes.
The registration act explains how to register, what documents should be
registered, and how to do so. The necessary documents must be properly
registered by following the procedure mentioned under the Indian Registration
Act otherwise it may become invalid. The act also discusses the consequences for
failing to register the required or mandatory documents.
The Act also ensures a good administration system among government departments
and the court system, requiring that everything be handled in an orderly manner
within a set time range to avoid future misunderstandings.
References
- https://www.indiacode.nic.in/bitstream/123456789/13236/1/the_registration_act,_1908.pdf
- https://www.bankbazaar.com/home-loan/property-registration-fees-and-stamp-duty-charges.html
- https://blog.ipleaders.in/registration-of-documents-and-consequences-of-non-registration-under-section-17-of-the-registration-act-l908/
- https://taxguru.in/corporate-law/understand-property-registration-laws-india.html
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