Did your neighbor send any legal notice or his representation was just oral without any documentary evidence to prove the acts of encroachment?

Just wait for him to produce the papers showing the encroachment, if you are satisfied that you have encroached a portion as alleged, then you can negotiate to purchase the encroached portion by getting a sale deed registered on  the value as per government guidelines value.

However if he cannot prove or just wants to create trouble and expecting huge money, you can issue a legal notice to him through your lawyer to not interfere in your possession and enjoyment of the property, after which you can even file a suit for permanent injunction against him on the same lines, if he is filing a suit for declaration and possession of the encroached portion, you can challenge the same and in the court mediation lso you can settle the matter on a compromise note.

1) neighbour has to prove that you encroached in his land 

2) he has to approach survey office for carrying out joint survey of the land 

3) based on survey report correct t the boundaries of land if survey report proves encroachment 

4) in event any suit is filed file consent terms in court fir amicable settlement 

1. Submit an online application under Surveys and Boundaries Act to Deputy Director, Survey and Land Records, Hyderabad remitting requisite fee seeking survey and demarcation of your land giving details of all neighboring land holders touching the boundary to be demarcated.
2. Negotiate with disputant for out of Court settlement.
3. Law of adverse is not applicable against the owner of property.
4. As your land is protected by compound wall, you need not worry about his claims. Take firm stand.
5. Since he has not taken any objections to construction of compound wall, he has admitted your boundary. Now he wants to question, it is his problem.
6. Best option is, purchase his property.

1. First you have to ascertain the basis of his claim. If he does not have any documentary proof to set up his claim then the merit of the case is negligible.

2. In such case you can dare him to file suit but at the same time propose for peaceful settlement of the case.

3. He may have papers to substantiate his claim as well. 

3. In either of the situations money will pay a pivotal role for amicable resolution of the dispute. 

The dispute is unlikely to materially affect marketability, as any sale can only be made to the extent reflected in your title deed. Given that the alleged encroachment constitutes a minuscule portion of the overall property, no injunction can ordinarily operate against the entire property. If the property is sold, appropriate disclosures may be incorporated in the sale deed; moreover, long, continuous possession carries significant legal weight, and with proper documentation, marketability is not an issue at all.

Alternatively, you may organise a joint government/revenue survey, as encroachment disputes are determined on documentary records and precise measurements, not assumptions. In the event of settlement, a monetary settlement or outright purchase of the disputed strip is generally preferable to altering the physical boundary. Any such settlement or purchase should be recorded through a separate, properly drafted, and registered instrument.

Your concern is practical and well-founded. Even a weak boundary dispute can become a commercial liability because buyers and their lawyers treat pending or threatened litigation as title clouding, irrespective of ultimate merits. Your approach should therefore be driven not only by legal strength but by marketability and finality.

I will address this step-by-step.

First, a clarification on adverse possession. Mere existence of a compound wall for 15+ years does not automatically perfect title by adverse possession. Adverse possession requires proof that the occupation was hostile, open, continuous and to the exclusion of the true owner, and it must be declared by a court. Until such declaration, adverse possession is only a defence, not a clean title. Therefore, relying on adverse possession alone will not satisfy a buyer or lender.

Now, coming to the two scenarios.

If the neighbour has credible documentary proof (such as FMB, survey sketch, village map, title deeds correlating measurements), then your legal position weakens regardless of how small the encroachment is. Courts generally order correction/removal of encroachments even if they are marginal. In such a case:

• Prolonged litigation will almost certainly block saleability.
• The rational approach is settlement, not contest.

If the neighbour does not have credible paperwork, your legal position is stronger, but your commercial problem remains the same. Even an unsubstantiated claim, once raised, creates buyer hesitation. So even in this case, a clean settlement is preferable to winning years later.

Now, on settlement options.

Between monetary settlement and physical correction of the boundary, the best option depends on long-term clarity, not immediate convenience.

If you opt for monetary settlement while retaining the existing boundary, this is acceptable only if it is properly documented. Otherwise, it invites repeat claims by heirs or successors. A mere receipt or oral settlement is useless.

If you opt to correct the boundary wall, this gives visual clarity, but without documentation, it still does not fully protect you. Physical correction without legal acknowledgment can still be challenged later.

In high-value urban property transactions like Hyderabad, the gold-standard solution is:

A comprehensive settlement deed, preferably registered.

What you should ideally do is the following:

1. Conduct a joint government survey (through the revenue authorities) and prepare a survey sketch showing the disputed portion clearly. Even if settlement is the goal, this documentation anchors the resolution.
2. Enter into a registered Boundary Settlement / Compromise / Release Deed, clearly stating:

• That both parties have examined title documents and survey records
• That the dispute (actual or alleged) regarding boundary/encroachment is fully and finally settled
• That the neighbour waives, relinquishes and releases all present and future claims regarding boundary, encroachment or possession
• That the settlement binds heirs, successors and assigns
• That no civil, criminal or revenue proceedings shall be initiated in future

• Either that the existing boundary is accepted as final; or
• That the corrected boundary is accepted as final, with reference to survey sketch

From a buyer’s lawyer’s perspective, a registered settlement deed is far superior to:

• Winning a case years later
• Claiming adverse possession
• Producing affidavits or undertakings

Such a deed effectively sterilises the dispute permanently and removes title clouding.

Finally, regarding your interest in purchasing his entire land parcel:

If negotiations move in that direction, the encroachment issue should be merged into the sale transaction, with a recital stating that all boundary disputes stand resolved and merged into the conveyance. This is the cleanest possible outcome.

In summary:

• Do not rely on adverse possession as a market solution
• Do not leave settlement undocumented
• Prefer a registered settlement deed, whether monetary or boundary-based
• Ensure waiver language binds future heirs
• This approach protects you legally and commercially

Handled this way, you can sell the property without hesitation or adverse due-diligence flags.If you wish to contact us, you may do so on https://qrco.de/syslaw

You can file a declaration suit in court for seeking directions form court. You can also file application for land survey and determining your land through competent land department or office in your area 

If your neighbour can show valid paperwork (FMB, survey, etc.) supporting his claim, your adverse possession defense may be weakened, and a peaceful settlement—either monetary or by adjusting the boundary—would be safer and faster. If he lacks paperwork, your adverse possession claim (12+ years of open, continuous, exclusive possession) is stronger, but litigation still risks title clouding and delays sale.

Given the complexities, your optimal path combines legal defense with a strategic settlement, prioritizing clear title for future sale. Your adverse possession argument (12+ years of peaceful, continuous possession under Indian law) is strong, but as you note, litigation creates a title cloud. Therefore, a peaceful, documented settlement is vastly superior to a court win, especially since you're interested in acquiring his land.

Your approach should be two-fold. First, immediately engage a property lawyer to verify both titles via registered sale deeds, FMB/survey maps, and recent TSLR data from the Dharani portal. This due diligence is critical regardless of his paperwork. If he has strong paperwork (e.g., a recent survey proving encroachment), your position weakens, making a monetary settlement more compelling. If he lacks paperwork, your adverse possession claim is stronger, but the litigation risk to your sale plans remains identical.

Thus, pursuing a monetary settlement is almost always preferable to physically moving the boundary wall. A modest, one-time payment (potentially framed as part of a larger land purchase negotiation) extinguishes his claim permanently and is a business cost. Correcting the wall is an admission of encroachment, may not stop him from suing for past damages, and does nothing to enhance your frontage ambition.

For any settlement, you must execute a registered Release Deed (Extinguishment Deed) or a Settlement Agreement. This legally binding document, prepared by your lawyer, must clearly state he relinquishes all claims over the disputed strip (specifically identified in a schedule/sketch) in consideration of the paid amount, with a covenant that he will not initiate any legal proceedings. Registration is non-negotiable as it provides presumptive evidence and binds successors. This document, alongside your existing titles, will satisfy future buyers' lawyers, clearing the title cloud definitively. Initiate negotiations from a position of strength by having your evidence ready, but lead with the mutual benefit of a clean resolution and your interest in a larger purchase, which could make a small settlement for the strip more palatable to him.