You can go ahead with the purchase, if the name change has been taken place in accordance with the law. Just ensure that you possess all the relevant documents on name change for any future litigation chances to sue the correct party or parties.
Seller of Flat a Pvt Ltd Company converted to LLP
I am considering buying a flat in Mumbai. The seller of the flat has registered the sale deed in the name of "XY Consultancy Services PVt Ltd" in 2011. After about a month of registration the name of the company was officially changed with Registrar of Companies to "XYZ Consultancy Services Pvt Ltd" with the exact same PAN Number. Now 10 years later in 2021, the company converted from Pvt to LLP officially and records are there on MCA website. The new Company name is now "XYZ Consultancy Services LLP" with a new PAN number All property registration papers (property card, sale deed, share certificate etc with the seller) are all in the name of the very first company name "XY Consultancy Services Pvt Ltd" and the seller wants the new sale deed with me to take place with the newest company name "XYZ Consultancy Services LLP" including writing cheque in the name of the LLP company. Please advice
Asked 2 years ago in Property Law
Religion: Hindu
7 Answers
you can proceed
however in the recital portion of the sale deed, all the details as to how the name of the company came to be changed twice will have to be properly explained with corresponding documentary proof on that behalf being attached to the sale deed
also prior to signing the sale deed, issue a public notice in 2 local newspapers, one in English and another in Marathi, in which you will have to set out all the details of the company regarding its name change and also invite objections from the public against the intended sale in your favour
also carry out a title search through a registered search clerk from the office of the sub-registrar of assurances and obtain a search report to rule out about any third party rights having been created by the company in the flat being sold
also you will have to do a search on the court's websites to check that there is no litigation pending against the company
usually a search of the last 30 years is taken (that is to check the title flow even prior to the date on acquisition by the company)
also ask for a duly signed resolution of the company/LLP in which it is authorised for the company/LLP to sell its property
it would be advisable to take a separate declaration cum indemnity from the seller company/LLP to protect you against any misinformation regarding the name change
If the official records are proper for the transformation of the company over the period of time, you may very well execute the sale deed along with the latest 'avtar' of that seller, as the sale deed originally in favour of the company binds its successors too, in common law, even if is not expressly stated so in the document.
Ask seller to approach society to change name in share certificate on account t of change in
name of company to LLP
2) then only buy flat from seller
An individual, even being a partner or a owner of the company cannot sell the property without the approval of the company which has to resolve the same through a meeting and can authorise a representative to sell the property on behalf of the company.
If the property do not belong to the present company then the present company cannot sell the property on its previous company's name.
The present company should produce the details and proofs that this property had been transferred to this company legally.
From your contents it appears that the title is defective hence it is not advisable to purchase the property having defective title besides the seller do not have clear and marketable title.
Therefore you may better obtain a proper legal opinion from a local lawyer by producing all the relevant papers and proceed only if recommended.
Dear Client,
The seller can ask to issue the check in the name his company it might be the new name of the company. In case you have some doubt you can made the seller to sign a promissory note for confirming the name.
Thank You.
You can do the same by mentioning all the averment about the said old company in new sale deed
