Q: What are the documents that should be verified before buying a residential / commercial unit?
Ownership documents of land owner including title certificate.
Development Agreement, if the developer is not the owner and has acquired the development rights.
Intimation of Disapproval (IOD) and the building plan/s approved by competent authority.
Other permissions issued by the competent authority depending on the nature of plot/type of development.
If the construction is completed then Occupancy Certificate or Building Completion Certificate.
Draft of Agreement for Sale and brochure for specifications, layout and amenities in the flat/complex/layout.
Q: What documents are required to be executed if the intended purchaser wishes to proceed for purchase of premises?
The Developer shall execute an Agreement for Sale as per the provisions of The Maharashtra Ownership Flats (Regulation of the Promotion, Construction, Sale, Management and Transfer) Act, 1963 ("the MOFA").
Q: What is the procedure for execution of the Agreement for Sale?
The procedure involved is three-fold:
Firstly, the payment of adequate stamp duty on the Agreement for Sale
Secondly, Execution of the Agreement for Sale by the Developer/Promoter and the Purchaser and;
Thirdly, Registration of Agreement for Sale.
We shall deal with the above aspect in detail as under:
- Unless there is an agreement to the contrary, the stamp duty shall be borne and paid by the Purchaser as per Section 30 of the Maharashtra Stamp Act, 2013.
- As per prevailing laws, the stamp duty to be paid on the Agreement for Sale shall be an amount equivalent to 5% on the market value of the unit as per prevalent ready reckoner rates.
- Market value means the price at which a unit could be bought in the open market on the date of execution of such instrument. This price is determined on the basis of the ready reckoner issued each year.
- The Mode of payment of stamp duty is E-Payment through GRAS (Govt. Receipt Accounting System)
- After the payment of stamp duty on the Agreement for Sale, the same shall be duly executed by all the parties, i.e. the Developer/Promoter and the Purchaser/s. All the pages of the document should be signed by all the parties. The Agreement should be witnessed by at least two witnesses giving their full names, signatures, and addresses.
- The duly stamped and executed Agreement for Sale should be presented at the office of the concerned Sub-Registrar of Assurances for registration within 4 (four) months from the date of execution of Agreement for Sale.
- In case of delay in presenting within the stipulated four months from the date of execution of Agreement for Sale citing unavoidable circumstances by the Parties, the Registrar may condone the delay after collecting penalty under section 25 of the Indian Registration Act, 1908; provided the delay in presentation of the executed Agreement for Sale does not exceed 4 (four) months from the date of expiration of the aforesaid stipulated 4 (four) months (i.e. does not exceed 8 (eight) months from the date of execution of the Agreement for Sale).
- Registration of the Agreement for Sale is compulsory as per Section 17 of Indian Registration Act, 1908.
- The registration fees shall be an amount being 1% of the market value of the unit, subject to maximum of Rs.30,000/-.
The material contained in this section is for general information only and is not intended to be an advice on any particular matter. The reader should seek appropriate professional advice before acting on the basis of any information contained herein.