Updated: Oct 4
Property law is the field of law which governs the various forms of real estate (land) and
personal property ownership. Property law is legally secured rights which include intellectual
property, land and personal property. Property can be traded by contract law, and one might sue the offender under tort law to defend it if his property rights are violated.
Laws pertaining to real estate in India
In India, real estate is governed by a mixture of Federal and State laws. This is because according to Article 246 of the Constitution of India, the land is the subject of state list or list-II of the 7th schedule of the constitution of India, which covers subjects for which only the state can legislate.
On the o,ther hand, the transfer of property other than agricultural land, registrations of deeds and documents and contracts other than for agricultural lands, fall under the concurrent list or list III of the 7th schedule to the Constitution of India, which falls under the concurrent list.
Furthermore, since India is a country with diverse laws relating to devolution, inheritance etc, therefore, besides codified laws, it has a great impact on various customs and practices. Through the years, judicial precedents have adjudicated various aspects relating to real estate, which are either binding or have persuasive value, depending upon the forum/court in which it is adjudicated.
The following are some key legislation governing real state in India.
Transfer of Property Act
Indian Assessment Act
Registration Act and the Indian Stamp Act
The Indian Contract Act
Right to Fair Compensation and Transparency in Land Acquisition Rehabilitation and Resettlement Act 2012
Land Revenue Codes
The RERA Act
Foreign Exchange Management Act and Foreign Direct Investment Policy
Laws pertaining to real estate in the USA
In the United States of America, every state follows a combination of statutory and common laws. The laws in the USA are structure in the following way:
As per the Common law system, when it comes to bringing changes in laws, equal weight is
given to judicial precedents and new legislations. Courts generally rely on the document’s express provisions unless the parties’ intent is ambiguous.
The U.S. courts can review the conduct of the parties if the terms of the document at issue are not clear. Contracts for the sale or transfer of real estate should always be concluded in writing.
Laws pertaining to real estate in the UK
Real estate in England and Wales is underpinned by two main pieces of legislation:
The Law of Property Act 1925 and
The Land Registration Act of 2002
To consolidate and modernise property laws in England and Wales, the 1925 Act introduced
significant changes to pre-existing real estate law. It is far-reaching and sets out general
concepts, such as the property and land interests that may exist under the law, land ownership and many of the rights and responsibilities in respect to it, which must be registered with a governments land registry.
These two acts, however, are not all-inclusive and different aspects of real estate law and
the procedure, such as the execution formalities for contracts and deeds, are regulated by other laws.
Legal restrictions on ownership of a real estate by particular classes of persons
There are a few controls that bar a foreigner from acquiring property in the USA for property
investment. The only restriction that still remains is the control of U.S. agricultural and natural resources in certain regions. A foreign individual who wants to invest in property is required to:
Purchases at least 10% of a U.S business, must file a private report within 45 days with the bureau of economic analysis of the U.S. Department of Commerce,
Purchase r transfer U.s agricultural lands who much file a public report within 90 days with the secretary of agriculture
Hold any direct us real estate investments valued over$50,000 during the previous calendar year, who must file an information return and
Control a domestic or foreign corporation- the corporation must file an information return annually with the internal revenue service.
Under the 1976 Hart-Scott Rodino Antitrust Improvement Act and the 2018 Foreign Investment Risk Analysis Modernization Act, more reporting may be needed.
Under the constitution of India, earlier the right to property was granted as a fundamental right, but at present, the right to property is not a fundamental right but a constitutional right.
In accordance with Article 300A of the Constitution of India, no person shall be deprived of his property except by the rule of law, thus incorporating the doctrine of eminent domain which provides for the acquisition of private property in the public interest by the government.
Furthermore, the State is constitutionally empowered to legislate and enforce legal limits on ownership of land by certain groups of people or on ownership of land beyond land ceilings; In most states, ownership of real estate has been limited in such a way that non-agriculturalists are not allowed to buy agricultural land in that state.
No person outside India can, except as permitted, acquire any immovable property in India other than as set out above under established foreign exchange standards. To assess their eligibility to buy immovable property in India, non-residents may be divided into three categories:
A person residing outside India who is a citizen of India
A person of Indian origin residing outside India and
A person not being an Indian or a person of Indian origin
Without limit, anyone over the age of 18 of any nationality may purchase and sell real estate.
Likewise, any company can retain and dispose of land wherever it has been created, provided that the company has the authority to do so. This is subject to the fines of the United Kingdom, the EU or the United Nations.
Government of the United Kingdom with a futuristic approach published a draft bill which requires any foreign entity that owns or wishes to own a property in the UK to identify its beneficial owners on a new register. Any foreign corporation which fails to comply with this will not be able to sell charge or lease the land for a term of more than seven years. The proposed new register will be enforced in 2021.
Is there a state guarantee of title? What does it guarantee?
No, in the United States of America there is no state guarantee of title. Almost every owner
secures insurance that they have a good title by buying title insurance from title insurance
companies, who search and underwrite the title of the property.
No, there is no State title guarantee. Providing a guarantee of the title is one of the state's legislative agenda. However, enforcing this is highly complicated due to the numerous complications surrounding India's land title, so no state has yet legislated any sale provisions.
At the same time, the method of purchasing lands under eminent of lands by the state has been adopted by different states, some comforts from the state on the title are given as contractual safeguards.
Yes, the United Kingdom guarantees a registered title. Generally speaking, the land registry is obliged to recognise any person against any damage incurred by an error in the registry, even if the error results from forged documents, the land registry is obliged to recover payments from third parties who are entirely or partially responsible for the error.
On a land scale, when is title or ownership transferred to the buyer?
In most countries, ownership passes when the deed is handed over. The transport instrument is recorded to safeguard rights and protect against third-party claims. Insurance is used in many countries to protect against “loopholes” interests or claims that arise between the execution and recording of the deed.
A sale is a transfer of possession, in compliance with Section 54 of the Transfer of Property Act of 1882, in exchange for a price paid or promised, or a price partially paid and partly promised. Such transfer may only be made by a licenced instrument in the case of tangible property of the value of Rs 100 and upwards or in the case of a reversion or other intangible things; Tangible immovable property below Rs. 100 can, however, be transferred either through a registered instrument or through the delivery of ownership.
Such transfer can only be made through a registered instrument in the case of tangible property valued at Rs 100 and more, or in the case of reversal or other intangibles, while tangible immovable property under Rs. 100 can be made either through a registered instrument or by delivering over the possession.
If the transfer takes place by handing over the property, the transfer becomes effective when the acquirer comes into possession of the property/property. In cases where registration is
mandatory, the transfer will not take effect until the instrument is registered from Transfer.
Buying and selling of land is usually a two-step process. The first phase ends with a contract to buy and sell land. It is not an immediate transfer of ownership, but an obligation of the parties to the transaction and the transfer of beneficial ownership to the potential buyer. The second phase ends with the payment of the purchase price and the transfer of legal ownership, subject to registration. It is possible but not usual for the two stages to be concluded simultaneously.
Formalities for the sale and purchase of the real estate
Typically, the parties enter into a sales contract that sets out the mechanisms of conclusion, as well as the conditions and measures that must be met or must occur between the date of signing and the date of conclusion. While a contract is not required, it protects both parties, neither of whom are required to enter into if certain precedents are not met. The form of the deed must be sufficient to transfer ownership under the laws of the situs state.
It must also be in writable form for a property insurance company to issue a property insurance policy for the owner. Even when moving a family home, a buyer wants time to do due diligence and requires sellers to provide information on condition, water quality, occupancy certificate, equipment, etc. For office buildings and other income-generating properties, evaluating leases will be an important duty of care. In either case, the requirements of a lender providing purchase money financing must be met.
Under section 54 of the transfer of property act 1882:
Transfer of tangible immovable property with a value of Rs. 100 upwards or in case of a reversion or other intangible thing, can be a registered instrument.
In case of tangible immovable property having a value less than Rs 100 a transfer can be made either b a registered instrument or by delivery of the property,
Delivery of the tangible immovable property takes place when the seller places the buyer or such other person as he directs, in the possession of the property.
The seller should also have the capacity to sell and the buyer should have the capacity to by
Eligibility criteria as prescribes for a valid contract by the Indian contract act will also be
required to be met. Further implications of stamp duty also arise under the Indian Stamp Act 1899 and under different state laws which vary as per the location of the property. When a property is considered, the stamp duty is charged on the present agreement value or market value; whichever is higher.
English law requires that an agreement to sell land be in writing, include all matters expressly
agreed in a document, and be signed by all parties. Traders must be deeds, and in the case of registered land, there must be a transfer which prescribes the form and is recorded in the land registry to give the right to the buyer.