How to avoid fraud?
I wish to buy this property. It is a re-sale property. But the owner is not in the city and has not met us. Another person who says he has the Power of Attorney of the owner, has met us. What steps should I take to ensure I am not a victim of fraud?
1. Is this holder of Power of Attorney a relative of the "owner"? If so, there is lesser risk of a fraud (note: lesser risk, NOT ABSENCE of the risk of fraud). If it is a random, unrelated person, we encourage you to follow the next step, instead of talking only to this holder of PoA.
2. Talk to the owner directly rather than the holder of the Power of Attorney.
3. In the meantime, Check the following documents for proof of ownership:
List of Documents to be verified
1. Sale Deed/Title Deed/Mother Deed/Conveyance Deed (MOST IMPORTANT. They compulsorily MUST have this. Insist on seeing the original, not the photocopy. This deed MUST be registered.)
2. Document giving the Power of Attorney.
The Power of attorney will only allow the holder of the PoA to execute/sign the deed instead of the actual owner due to inability of the owner to be present. It DOES NOT give the holder of the PoA ownership over this land. So, in case you reach the stage of actually purchasing the land and signing the sale deed, then make sure the name of the party is the OWNER OF THE LAND not the holder of the power of attorney.
The following are additional proof of ownership. If all of them are not accessible, it is okay, but try and get as many of these as possible:
Khaata Certificates and Extracts
Mutation Registration Extracts
Joint Development Agreement
Sanctioned Building plan
NOC from Electricity Dept. / Pollution Dept. / Water Works / Port Authority
Sale & Construction agreement between developer/Builder & 1st owner
Copy of Possession letter from Builder / Developer
Any Loans on Property verification
Sale Agreement/Agreement to sell (NOTE: This is NOT the same as sale deed/conveyance deed. This sale agreement alone is NOT conclusive proof of ownership. If it exists, it MUST be followed up by a sale deed/conveyance deed, for it to be solid proof of ownership.)
All Paid Tax receipts
EC up to date for last 13 years
Demand letter from Vendor before disbursement
NOC from Society / Building
No Due Certificate
Layout approval plan
Auction Sale confirmation letter from local authority
Release Deed if any
Deed of Declaration
Latest Electricity Bill
The Supreme Court recently held that merely holding a General Power of Attorney does not give any right to it's holder to sell that land. He can only help in executing the sale, by signing the paper instead of the actual owner who could not be physically present, etc. He cannot sell the land to you unless he has the ownership of it. (Visit this link, or this link or this link to know about this legal issue in detail, in case you are interested.)
See the all original documents which show the property has clear marketable title as well as see whether the owner has given the rights to sale or transfer the property and lastly directly communication with real owner .
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