• Risks in Gunthewari plot purchase and resale

Dear Sir/Madam,

I am interested in purchasing a 2 Guntha plot around Pune as investment. I visited a reputed developer who has been in land development business for several decades. He showed a plot which is under the jurisdiction of a grampanchayat currently but it is expected that in coming years the area will come under corporation and thereafter it will be a residential zone and building should be possible. It is agricultural land at the moment. There is a risk involved that the area might not come under corporation jurisdiction for years but on the other side if it happens there is also chance of appreciation. While discussing it became apparent that it is a Gunthewari plot. He mentioned that registration of sales deed can start in few months but the money should be paid upfront and we will get power of attorney to register. On talking with multiple developers this seems to be a normal way of saleing Gunthewari plots.
The developer said that in case we pay him and find a legal irregularity later, he will refund all the money. 

1. Is this a legal way of purchasing the land?
2. Can I build a house on such a land?
3. Can I sale a house built on a Gunthewari plot?
4. How can I ensure that the title is clear?
5 how I can I ensure that the developer sticks to his words 
6. For saleing the land or house built on it, would I need permission of every other plot owner in that project?

Thank you very much.
Asked 7 years ago in Property Law
Religion: Hindu

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6 Answers

Guntha is only a unit of measurement of land. You need to check the 7/12 and other documents and do title search for such land before purchasing the same.  Once you become owner you can but there are some restrictions in selling agricultural land. You need to execute a Mou with developer in order to decide the same. No if the said land is owned by you then you dont need any permission.

 

Earlier as per gunthewari Act, Gunthewari is the traditional method used for measuring land in the state and several farmers had sold their plots on this basis. However, as per the Gunthewari Act, the practice of creating small plots of agricultural land in multiple gunthas was illegal and hence carrying out constructions on the gunthewari land was not legally approved. As per the Act, the owner of such a house was also not allowed to sell his property.

Presently you can sell the land as well as construct house on it. Maharashtra govt in 2015 has relaxed the rules for the Same

Prashant Nayak
Advocate, Mumbai
34514 Answers
249 Consultations

1. When the title is not clear then it is not advisable at all to buy this property. Even if you include an indemnity clause in the sale deed there may be difficult to get you compensated.

2. If title of the land remains litigated  then the house built on it would also come under cloud of the court.

3. Difficult to predict at this stage.

4. Choose another property.

5. Make indemnity clause in the deed. Take help of an advocate.

6. yes

Devajyoti Barman
Advocate, Kolkata
23653 Answers
537 Consultations

As per Section 18 of MRTP Act no construction can be undertaken in areas other than municipal corporations and municipal councils without the permission of the district collector's office.

 

2) it is agricultural land ask seller to convert it into NA land then only purchase the land 

 

3) as on date title is not clear and marketable as no regd sale deed is being executed in your favour 

 

4) there is no guarantee that builder will honour his commitment 

Ajay Sethi
Advocate, Mumbai
99775 Answers
8145 Consultations

Dear Client,

POA is not actual transfer of ownership and your title on the land will remain at stake. POA executes to evade stamp duty, no other benefits.

Until conversion not done, no construction except cottage but recently govt has relaxed the norms and now a common people can purchase a few gunthas land outside the city and can construct his own house. Resale permitted.

Without registered sale deed, title disputed.

Execute duly registered agreement, in case of default by seller, you can seek specif performance of agreement.

NO

Yogendra Singh Rajawat
Advocate, Jaipur
23079 Answers
31 Consultations

1) If your land is ‘gunthewari’, then it is not legally approved for construction as laws are not clear and duties to provide construction permission are still under process.

2)Creating such small plots and constructing houses on them is a non agricultural activity on agricultural land. So those who intend to do such activity are required to first convert agricultural land for non agricultural purpose. The Collector is empowered to grant such permission. Where such permission is not obtained, the Gram Panchyat cannot grant building permission. Since these sub-divisions are usually in multiples of a ‘guntha’, such developments are sometimes referred to as Gunthewari development.

3) Banks and Housing Finance Companies generally lend only against legal properties with a clear and marketable title and that which has necessary approvals from local authorities. Since construction on ‘gunthewari’ plots may not be permitted yet, you will need to wait for requisite approvals before starting construction

 

Mohammed Mujeeb
Advocate, Hyderabad
19325 Answers
32 Consultations

1.  There is no guarantee to regularise the proeprty at a later stage also, the builder in order to push the sale may give all such false assurances/promises, but after purchasing it you may have to run behind him for each and every thing, better do not go for purchase of this type of properties.

 

2.  Without NA conversion, you may not be able to build any house on it.

 

3.  If you have constructed a house on such plots, you may not be able to sell the same 

 

4. You have to produce all the documents befor a local advocate and get his opinion about the marketable title.

 

5.  You can get an undertaking in a stamp paper duly notarised, however that is also not a guaranteed material.

 

6. No.

 

T Kalaiselvan
Advocate, Vellore
89977 Answers
2492 Consultations

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