Sale cum GPA agreement, land sale and development
9 months ago
I have recently come across a flat available for sale. Upon referring to the registration documents, I noticed that the land was bought from the agents (to the original owner) in November 2011 by the present owner. In the sale agreement, there is a mention that agents have sold the property on behalf of the original owner based on the provisions of sale cum GPA agreement, active since 2008. This sale cum gpa appears to be registered in the revenue department. This sale deed (November 2011) also has the fee paid details like stamp duty, transfer fee and others.
After this agreement, the present owner joined with other land owners adjacent to his plot and went into a development agreement with the developer in 2012. From the share he got, flats are now available for sale ?
I am not sure whether this property, flat available for sale is free from litigation and risks in future? I got to know the supreme court case on sale cum gpa and in this case the present owner has paid the taxes even though the property was purchased from agents and there is no signature of the original owner on the registration document that happened though sale cum gpa in 2011.
We are interested in purchasing the flat but not sure of the steps to be followed. Please suggest me the things that i should be doing. Thank you.
The Hon’ble Supreme Court in the matter of Suraj Lamp & Industries Pvt. Ltd. Vs. State of Haryana & Anr. vide its judgment dated October 11, 2011, held that transactions of the nature of GPA Sales do not convey any title and do not amount to transfer, nor can they be recognized or a valid mode of transfer of immovable property. A power of attorney is not an instrument of transfer in regard to any right, title or interest in immovable property," the bench said, after interpreting various provisions of the law concerning property sales. However, the bench said the judgment will not affect "genuine transactions" under the GPA. In order to ensure that GPA continues to serve its purpose, the court said its judgment will not affect the validity of sale agreements and powers of attorney executed in genuine transactions. "For example, a person may give a power of attorney to his spouse, son, daughter, brother, sister or a relative to manage his affairs or to execute a deed of conveyance. The court further said that a person can enter into a development agreement with a land developer or builder for developing the land either by forming plots or by constructing apartment buildings. In that connection, he can execute an agreement of sale and grant a power of attorney that will allow the developer to further sell the property to prospective purchasers. In view of the above findings of Apex Court, you being a prospective buyer need to verify the status of encumbrance in respect of the title of the property through court searching and get yourself satisfied with the present status of the property before taking the final decision in the matter. Reach out to an Advocate for proper guidance and steps.
Consult with a legal professional: Engage a lawyer who specializes in property law to review the sale documents, including the sale agreement, sale cum GPA agreement, and any other relevant documents. They can provide you with legal advice and assess the validity of the transactions.
Verify the authenticity of documents: Your lawyer can help you verify the authenticity and legality of the sale cum GPA agreement and other related documents. They can examine whether the agreement complies with the applicable laws and regulations, and whether any necessary registrations or approvals were obtained.
Conduct a title search: A title search is crucial to determine the ownership history of the property and identify any encumbrances or legal issues. Your lawyer can help you conduct a thorough title search to ensure that the property has a clear and marketable title.
Review court cases and precedents: Research and understand the Supreme Court case you mentioned regarding sale cum GPA agreements. Your lawyer can provide insights into the implications of the case and advise you on the risks and legal implications associated with the property.
Obtain legal opinions and clearance: Based on the review of the documents and title search, your lawyer can provide a legal opinion on the property's status, highlighting any risks or issues that may affect your decision to purchase. They can also guide you on the steps to be taken to mitigate any potential risks.
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