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List of documents to be checked while buying BDA property

 

“To transform Bangalore to an ideal global destination with high quality infrastructure, better quality of life by ensuring sustainable and planned development based on effective monitoring, regulation, through participatory and innovative approach” This is the mission of Bangalore Development Authority (BDA).

 

BDA came into existence in 1976 as a successor to erstwhile City Improvement Trust Board (CITB). Since inception, BDA has allotted 76000 sites to individuals for construction of residential dwellings. In addition, over 800 Civil Amenities (CA) sites have been given for use by various public utilities.

 

Currently, there is no allotment of sites happening from BDA, except e-Auctioning of corner sites in the existing layouts. Suppose, one decides to buy a BDA site from the original allottee, what documents he has to check is discussed in this article.

 

List of documents

 

  1. History records (mother deeds) – Whenever BDA acquires a land from landowners for development of a layout, the previous title is extinguished by law and title starts from the BDA’s acquisition of the property. So, don’t bother about the documents prior to BDA’s acquisition.
  1. Allotment Letter – Once the site is allotted to an Individual, BDA issues a letter called ‘Allotment Letter’.
  1. Proof of Payment – After getting the allotment letter, the buyer (allottee) has to pay the site value to BDA. The challan towards the payment of such amount has to be obtained.
  1. Absolute Sale Deed – BDA sells the property (site) to the buyers through a sale deed. Check whether the seller has an ‘Absolute Sale Deed’ executed in his name. (Please note that in the recent past, BDA has sold the property under ‘Lease cum Sale’ basis wherein the buyer acquires absolute right over the property after 10 year from the date of allotment. In such cases, the owner for the property won’t have the right to sell during lease period. After the lease period, the buyer has to get Absolute Sale deed registered in his name before selling the property).
  1. Possession Letter – BDA issues a possession certificate (letter) in favour of the buyer. This letter will carry the photo of the buyer.  
  1. Khata Certificate – Issued by BDA in favor of the buyer. The Khata certificate will have the photo of the buyer. Khata means ‘an account’. A Khata is a legal identification document containing all the details of the property such as the name of the owner, size of the building or plot, exact location and other such important particulars which helps in filing the property tax to the concerned authority.
  1. Tax paid receipts – The owner for the property has to pay annual property taxes to BDA. The tax paid receipts to be obtained.
  1. Encumbrance Certificate (EC) – An encumbrance certificate is a document maintained at Sub-registrar’s office which shows any monetary or legal liabilities on the property. Suppose, a banker has given loan against the property, he will create a charge on the property by registering a document at Sub-registrar office. Those entries will reflect in EC. So, the buyers of the property have to verify this document. If the property is not free from charges, one can’t buy such properties, till the seller discharges such liability and registers the satisfaction of charge document at the sub-registrar’s office.

 

Important Aspect – When you decide to buy a property, the seller will give a photocopy of the documents and collect a token advance (say, Rs.10000). If you find the documents are in order, ask for verification of original document from the seller. If the documents are kept in the bank, you can visit the bank along with the seller and get to see them. Always insist in verifying original documents.

 

Thought for the day

 

When you need ‘advice’ everybody is ready to ‘help’ you. But, when you need ‘help’ everybody gives you only ‘advice’

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About CA Prasad Chartered Accountant

CA Prasad Chartered Accountant
CA Prasad is a practicing Chartered Accountant and partner in Bangalore -based CA Firm. For further information or query, please email it to [email protected]
  • ANIL

    Excellent brief – Thanks.