Property buyers in India face more than just high prices. Legal disputes often buried beneath polished brochures and swift paperwork can derail even the most promising of deals. Before signing a sale deed or transferring a single rupee, every buyer must verify that the property is legally clean to avoid any future trouble, including possible loss of investment due to litigation or dubious land title.
What is a Disputed Property
A disputed property is one where ownership or rights are challenged by another party. This could stem from inheritance disagreements, conflicting sale records, or forged documents.
A litigated property is already involved in a legal case. Both carry risks, especially if court proceedings are underway or if objections have been filed with authorities.
Advertisement
Says Paras Joshi, managing partner of Verdienta Law, a law firm: "One of the most common issues I see is buyers not verifying the full chain of title. Even a single gap, like an unregistered transfer, can lead to serious disputes years down the line. We’ve seen cases where dubious power of attorney holders have sold the same land to multiple buyers, or where courts have refused to recognise decades-old ownership because key documents weren’t registered. Many first-time buyers assume that if someone is in possession or listed in the mutation records, the title must be clean. But hidden mortgages, unresolved partition suits, or undisclosed family claims can surface later and create major legal hurdles.”
Advertisement
Things To Check For
Here are the things buyers should check for.
Start With the Title Deed: Check the title deed for continuity and clarity. A valid title should reflect a complete chain of ownership without gaps. If ownership has changed hands frequently or without proper documentation, there may be a cause for concern.
Obtain the Encumbrance Certificate: The Encumbrance Certificate (EC), issued by the sub-registrar’s office, lists registered liabilities on the property. If the property is mortgaged, under court attachment, or subject to other financial claims, it will be recorded here. Anomalies or gaps in the EC should not be ignored.
Review Court Databases: To identify active litigation, use the e-Courts portal or National Judicial Data Grid (NJDG). These online systems allow searches by party name, case type, or property reference. Some states also publish local land dispute data through revenue departments.
Advertisement
Inspect Local Land Records: Mutation records, available at the local revenue office, show the official transfer of ownership. Delays, rejections, or objections listed in these records can signal legal complications. Verify the name in these records matches the seller’s identity.
Visit the Sub-Registrar’s Office: Caveats filed with the sub-registrar are public records. These legal notices are submitted to prevent registration of a sale if a third party has a claim. A caveat is often a clear sign of ongoing or pending litigation.
Cross-Check Property Tax and Utility Bills: Bills for electricity, water, and municipal taxes must be up to date and in the seller’s name. Arrears or mismatched names may indicate disputed ownership or unresolved legal matters.
Advertisement
Speak to Local Residents: In apartment complexes or housing societies, resident welfare associations often have information on ownership history and ongoing disputes. In standalone properties, neighbours may be aware of any conflicts, especially if they have been long-standing.
What to Do If a Dispute is Found
If a dispute surfaces during verification, pause all proceedings immediately. Do not make any payments, do not sign agreements, and do not proceed with the registration.
Assess the nature of the issue. If it's a minor boundary dispute, resolution might be possible through negotiation or documentation. If it’s a title conflict, court stay, or inheritance challenge, the risks are significantly higher.
Engage a property lawyer without delay. A qualified advocate can interpret legal documents, check for restraining orders, and offer an informed opinion. In some cases, legal remedies may still allow the transaction. In others, walking away is the safer choice.
If an advance has already been paid, review the agreement terms and act fast. Legal notice for refund or recovery action may be needed depending on the seller’s conduct and documentation.
Can a Property Under Litigation Be Sold?
In most cases, properties under litigation cannot be sold. If a property is under litigation, the court may issue a Lis Pendens a public notice preventing transfer of ownership while the case is in progress. Any sale made in defiance of such a notice may later be declared void by the court.
