• Legal Advice for Buying a Plot Around Hyderabad - Developer Acting Under GPA and Ownership Concerns

Dear Lawyers,

I am planning to buy a residential plot in Telangana that is part of an HMDA-approved layout. The developer is acting under a General Power of Attorney (GPA) granted by the landowner. However, there are gaps in the ownership history, and I have concerns about the legal risks associated with this purchase. Below are my questions:

1)Ownership and Title Verification: How can I verify the complete ownership history of the property, especially if records do not explain how the current landowner acquired it before 2005(pahani records from 2005)?Can the absence of earlier ownership details (e.g., inheritance, purchase, or government allotment) pose risks to my ownership in the future?

2)GPA and Developer Agreement: Is it safe to buy property where the developer, acting under a GPA, executes the sale deed without the landowner directly participating? What risks arise if the GPA is revoked, contested by the landowner or their heirs, or deemed invalid? How can I mitigate these risks?
Should the sale deed explicitly reference the GPA details and include an indemnity clause to protect me from future claims? What key clauses should I verify in the Development Agreement between the landowner and developer to ensure the transaction is legally sound?

3)Approvals and Land Use: Does HMDA approval ensure that the layout and property are legally compliant? Are there specific conditions in the approval I should verify? How can I confirm whether this project is registered under RERA? Is RERA registration mandatory for such developments? What should I check in the land conversion approval (agricultural to residential use) to ensure there are no pending conditions or risks?

4)Registration and Finalization: Should I insist on the landowner co-signing the sale deed along with the GPA holder (developer) for added security? What steps can I take to ensure the sale deed and registration process are legally binding and protect me from third-party claims?

5)General Risks: How can I verify that the property is not classified as Waqf land, Full Tank Level (FTL),Hydraa or government-assigned land, or forest land? Are there risks of undisclosed encumbrances or claims from earlier owners or legal heirs, and how can I protect myself?

6)Is title insurance or any other insurance recommended in this case, and what specific risks should it cover?

7)Final Advice:Based on the above, would you recommend proceeding with this purchase? What are the key precautions I should take to ensure the title is clear and ownership is secure?

Additional Context:
The land conversion is approved for residential use.
The HMDA layout has been sanctioned.
The sale deed will likely be executed by the developer under the GPA.
There are no records explaining how the landowner acquired the property before 2005.
Please advise on the legal risks and steps I should take to safeguard my investment.

Thanks in advance
Best regards
Asked 1 year ago in Property Law
Religion: Muslim

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6 Answers

you need original chain of documents . ask builder to explain absence of earlier documents 

 

2) the sale deed of 2005 must be containing recitals of earlier transactions 

 

3) I presume GPA is registered . land owner cannot revoke GPA if it is coupled with consideration 

 

4)ask developer to  indemnify you in case third party claims are made 

 

5) check whether project is registered with RERA . it has RERA registration number 

 

 

6) land owner signature is not necessary on sale deed

 

7) contact a local lawyer . ask him to certify whether developer has clear and marketable title to land 

 

Ajay Sethi
Advocate, Mumbai
99879 Answers
8150 Consultations

Legal Advice for Buying a Plot in Hyderabad:

1) Ownership and Title Verification


  • Verification Process:

    • Obtain Encumbrance Certificates (EC) for at least the last 30 years.
    • Cross-check pahani records, mutation entries, and revenue records with the Sub-Registrar and Revenue Departments.


  • Risks Due to Ownership Gaps:

    • Missing records before 2005 could lead to future disputes if heirs or third parties claim the land. Ownership gaps might question the title's authenticity.


  • Mitigation:

    • Hire a property lawyer for a detailed title search.
    • Insist on an indemnity clause from the developer and landowner in the sale agreement.

2) GPA and Developer Agreement


  • GPA Risks:

    • If the GPA is revoked or challenged, any transactions made by the developer could be voided.
    • If the landowner passes away or their heirs dispute the GPA, future claims could arise.


  • Mitigation:

    • Verify the GPA is registered and valid.
    • Check if the GPA specifically grants the developer authority to execute sale deeds.
    • Include indemnity clauses in the sale deed to protect against GPA-related claims.


  • Key Clauses in Development Agreement:

    • Ensure the agreement specifies clear ownership rights, revenue-sharing terms, and developer obligations.
    • Verify if the agreement allows direct sale of plots by the developer.

3) Approvals and Land Use


  • HMDA Approval:

    • HMDA approval confirms layout compliance but does not guarantee title clearance.
    • Verify HMDA conditions like open space reservations, approach road approval, and infrastructure requirements.


  • RERA Registration:

    • If the project involves more than 500 sq. meters or 8 units, RERA registration is mandatory. Check the RERA registration details online.


  • Land Conversion:

    • Ensure agricultural-to-residential conversion approvals are complete and recorded. Verify no pending conditions under G.O. 111 or similar restrictions.

4) Registration and Finalization


  • Co-Signing by Landowner:

    • Insist on the landowner co-signing the sale deed for added security.


  • Sale Deed Details:

    • Include GPA details, indemnity clauses, and explicit mention of clear title in the sale deed.


  • Registration Process:

    • Ensure the property is free from encumbrances, verified by a fresh EC.

5) General Risks


  • Classification Checks:

    • Verify if the land is Waqf, FTL, HYDRAA, forest land, or government-assigned land by consulting relevant revenue authorities and local offices.


  • Undisclosed Encumbrances:

    • Obtain a certified EC to ensure no encumbrances exist.
    • Seek a legal opinion on the title.

6) Title Insurance


  • Recommendation:

    • Title insurance is highly recommended as it covers unknown risks like undisclosed heirs, ownership disputes, and fraud.


  • Coverage:

    • Ensure the policy covers litigation expenses and financial losses due to title defects.

7) Final Advice and Key Precautions


  • Proceed with Caution:

    • Proceed only after a thorough title search and due diligence.
    • Engage an experienced property lawyer to review all documents.


  • Key Steps:

    • Verify the GPA and development agreement thoroughly.
    • Ensure both the developer and landowner execute the sale deed.
    • Check all approvals (HMDA, RERA, land conversion) are complete.
    • Obtain an indemnity bond to protect against future claims.

For detailed, personalized advice, consider consulting a property lawyer in Hyderabad. Hope you find this information helpful. If you could spare two minutes to write a review, it would be greatly appreciated. Thank you.

Shubham Goyal

Shubham Goyal
Advocate, Delhi
2136 Answers
16 Consultations

 

Dear Client,

Ensure indemnity from the landowner, as absence of records prior to 2005 will increase future claims. Engage a property lawyer and conduct the due diligence process. Obtain documents such as pahani records, title deeds, mutation records, and encumbrance certificates that reflect the complete ownership history. Verify that the GPA is real and that it is also registered, irrevocable, and specific to sale; include GPA details and indemnity clause in the sale deed; ensure HMDA and RERA compliance with duly accorded land conversion approvals with no outstanding encumbrances such as Waqf lands, FTL, or government classifications; demand co-signing of the sale deed by the landowner for additional security; verify the development agreement between the landowner and developer. Consider title insurance to cover such risks as undisclosed claims or ownership disputes. Proceed only if all records are clear, approvals valid, and the title is secure.

Hope that this helps you to solve your problem.



Anik Miu
Advocate, Bangalore
11023 Answers
125 Consultations

You need to know whether there is any encrumbrance in the said land 

Prashant Nayak
Advocate, Mumbai
34591 Answers
249 Consultations

1. Yes, it will lead to litigation. Get complete list of documents since beginning.

2.  Except relatives, the sale deed executed on the strength of GPA cannot confer title. The Principal has to sign.

3. RERA registration is mandatory.

4. Principal has to sign.

5. The revenue records will show the classification of land.

GPA based sale deed is risky. Legal heirs or some strangers may claim title in future. Check the documents from the beginning. Get a legal opinion.

G.Rajaganapathy

Advocate

High Court of Madras

 

Rajaganapathy Ganesan
Advocate, Chennai
2300 Answers
8 Consultations

1. You can instruct the builder to provide all the chain documents pertaining to this property.

2.  The JDA as well as the GPA clearly authorises the builder to sell the property which is legally valid. If there is any problem then you can very well sue the seller also along with the builder.

3. The construction approval will be granted by competent authorities only if all the legal  requirements are complied properly in all aspects. You can check if the project is RERA registered.

4. The land owner has given a registered GPA to sell the property hence the builder can go ahead with sale of flat on the basis of JDA.

5. The property related papers will let you know the details on proper scrutiny.

6. You can purchase insurance on property after buying the same.

7. You may obtain a proper legal opinion from an experienced lawyer in the local before venturing into the purchase. 

T Kalaiselvan
Advocate, Vellore
90079 Answers
2501 Consultations

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