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LEGAL CHAT
Notice and transfer of property
N.C.S. RAGHAVAN
ARVIND RAGHAVAN
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It deals with a transaction relating to immovable property effected through the registration of a compulsorily registrable instrument.
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— Photo: K. Murali Kumar
Right procedure: Check the territorial jurisdiction in which your property stands.
The execution and registration of a compulsorily registrable non-testamentary instrument (document) effectively and conclusively transfers and conveys the rights and interests in immovable property to and in favour of the transferees. Such transferees acquire clear and marketable title to such rights.
The most significant legal consequence is that there is universal “notice” to such title in the hands of the transferees which will receive complete and absolute recognition from the general public. The nature and scope of such “notice” has been clearly defined in Explanations to Section 3 of the Transfer of Property Act, 1882, and the same are highlighted below:
It deals with a transaction relating to immovable property effected through the registration of a compulsorily registrable instrument.
It clearly states that any other person acquiring such property or any part thereof or share or interest in the same shall be deemed to have notice of the aforesaid instrument from the date of the registration of the same.
Procedure
Where the immovable property covered by the instrument is situated within the jurisdiction of more than one sub-registrar, then, the memorandum of such instrument registered with one sub-registrar should be filed with the other sub-registrar in whose jurisdiction a part of such immovable property is situated.
Once a memorandum is so filed with the other sub-registrar, then there is deemed to be notice of such memorandum and through such memorandum there is notice to the main instrument to all persons dealing with such part of the property situated within the jurisdiction of the other sub-registrar.
Such a memorandum will be duly entered in the appropriate registers and books maintained by the other sub-registrar. This is an important provision dealing with immovable property of huge sizes and dimensions which come under the territorial jurisdiction of different sub-registrars and it emphasises the absolute legal necessity of preparing a memorandum of the original instrument and having the same duly filed and entered into the statutory books and registers of the other sub-registrars.
Explanation to Section 3 specifies that any person dealing with such property shall be deemed to have notice about the actual possession thereof of any person or persons having title to such property.
Another explanation makes it clear that when an authorised agent acquires notice of the transaction and interest, the agent’s principal also is deemed to have notice of the same. However, when an agent fraudulently conceals the fact of his having such notice, with the knowledge and connivance of another person, then the principal shall not be deemed to have notice as against the other person who connives with the agent.
(N.C.S. Raghavan is a chartered accountant and Arvind Raghavan, an advocate)
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