Why Is Mutation Of Property Important For Buyers?
Once you have completed a real estate transaction and registered the property in your name, it is important for you to also get a mutation of property done in government records. What is property mutation, and why is it important? PropGuide explains:
Sahil Sharma did not know what mutation of property means. He thought all formalities for transfer of property were finally over once he successfully completed his home loan-related work, registered the property in his name, and paid the stamp duty on it. About a year later, he overheard his colleagues talking about payment of property tax and it occurred to him that he had not paid his property tax. He asked one of the colleagues how and when it was to be done.
The colleague, who knew that Sharma had purchased an apartment recently, asked: "Have you got the mutation of property done?" Clueless about this, Sharma replied in the negative and was suggested that he get the mutation of property done as soon as possible, so that he could pay the property tax and avoid any penalty and interest that might accrue.
What is mutation of property?
The municipal body in a city keeps records of property ownership transfers to fix property tax payment liabilities. And this document is a way to ensure that. Mutation of property shows that a property has been transferred from one person to another, and it also assists authorities in fixing taxpayers' responsibility. Although not a legal document, it will be crucial if you want to sell your property in future. Mutation of property in Hindi is called Daakhil-Kharij.
How to apply for mutation of property and what does it cost? And what are the documents required for mutation of property in Delhi or Kolkata? Please note that the procedure and the required documents vary from state to state. But across India you have to file for mutation of property under these three circumstances:
- If you have bought a property: Documents that you will be expected to submit for mutation of property in this case include a copy of the sale deed, an application for mutation of property with Rs 3 court fee stamp affixed on it, an indemnity bond on a Rs 100 stamp paper, an affidavit on a Rs 10 stamp paper, and latest property tax clearance papers.
- Mutation of property after death of owner if you are an heir: For mutation of property in such cases, applicants have to submit a death certificate, a copy of the will, an indemnity bond on a Rs 100 stamp paper, an affidavit on Rs 10 stamp paper attested by a notary, and the latest property tax clearance papers.
- If you have bought a property through a power of attorney: For mutation of property in such a case, you have to submit a copy of the power of attorney papers, a copy of the will, an indemnity bond on Rs 100 stamp paper, an affidavit on Rs 10 stamp paper, and the latest property tax clearance papers, along with an application with Rs 3 court fee stamp affixed on it.
Things you should know
- It has to be noted that a very minimal penalty — as low as Rs 25, for instance — is charged if you do not get mutation of property done. And, you can also get the job done when it suits you. However, if you decide to sell your property in future, buyers will surely ask you to produce mutations papers. Not having them in place may jeopardise your chances of selling your asset.
- Though it's not legally binding, mutation of property is important as it stands as the proof of ownership and might act as a tax record.
- Property mutation charges differ from state to state. And in most cases, they are in the range mentioned earlier.
- Mutation of property is not a one-time duty; these papers need to be updated from time to time. A regular update will ensure your property records stand clean.
Note: All the stamp paper charges mentioned in this post are according to the rates charged for mutation of property in Delhi.
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