Lawful possession and an unbroken, valid chain of documents are other pre-requisites before registering a property, else ownership may not be guaranteed
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A clear title refers to ownership of property that is lawful, marketable, and capable of being transferred without any dispute or legal hindrance.
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A recent Supreme Court ruling has underscored a crucial reality for homebuyers and heirs: a registered sale deed alone doesn’t guarantee ownership. In the Mahnoor Fatima Imran vs M/S Visweswara Infrastructure Pvt Ltd case, the court held that true ownership requires not just registration, but also clear title, lawful possession, and a valid chain of documents — without which even a registered deed may not stand in court.
Key takeaways from the judgment
In this case, the Supreme Court clarified that property registration is merely a public record of a transaction — not proof of ownership. “Legal ownership arises only when the seller has a clear and undisputed title and lawful possession. If the seller’s title is defective due to fraud, encumbrances, or irregularities, registration alone cannot cure those flaws. In other words, mere registration without actual and lawful possession does not establish ownership rights,” says Shankey Agrawal, partner, BMR Legal.
The takeaway for buyers: treat registration as procedural, and always verify the seller’s title and possession before purchase. “If the seller’s title is defective, whether due to fraud, prior encumbrances, government acquisition, or any other irregularity, then registration cannot cure those defects,” adds Agrawal. Buyers must, therefore, exercise caution and conduct thorough due diligence before purchasing property.
What constitutes a ‘clear title’?
A clear title refers to ownership of property that is lawful, marketable, and capable of being transferred without any dispute or legal hindrance. It must originate from a legitimate owner whose rights can be traced through an unbroken chain of valid and properly registered documents.
“A property with a clear title must also be free from litigation, mortgages, liens, or government restrictions, ensuring that no third party has a claim or interest in it. Courts generally determine a clear title by verifying the validity of past transfers and ensuring the property hasn’t vested in the government or any statutory authority,” says Agrawal.
Conversely, “a title is unclear when there are breaks in ownership, unregistered or fraudulent documents, unauthorised transfers, hidden encumbrances, disputes, adverse possession, inconsistent records, or legal violations”, says Amit Kumar Nag, partner, AQUILAW.
What is a proper chain of documents?
A proper chain of documents is a complete, legally valid sequence tracing a property’s ownership from the original owner to the present seller. “It includes duly executed and registered instruments, such as sale, gift, partition, or succession deeds, showing lawful transfers and consistent details like survey numbers and boundaries,” says Nag.
Each link must be authentic, registered where required, and supported by possession and official records. “The chain is defective if based on unregistered or informal documents, missing deeds, inconsistent property details, unauthorised transfers, or land vested in the government,” adds Nag.
In short, the chain is the property’s ownership trail—if even one link is weak or missing, the title is not clear or marketable.
‘Lawful’ and ‘unlawful’ possession
Lawful possession means having both actual control over a property and a valid legal right to keep it, usually based on a registered sale deed, lease, or lawful allotment. “If someone holds papers but lacks real control or their claim comes from an invalid or fraudulent source, the possession isn’t lawful,” says Agrawal.
Unlawful possession is occupation without legal authority, such as holding government land, occupying after ownership has ceased, or possessing through fraud or a void transaction. “Even long physical possession cannot become lawful if the source is invalid. Lawful possession and lawful ownership must exist together—one alone is not enough,” observes Nag.
Property mutation
Property mutation is the process of updating ownership details in municipal or revenue records (such as the Property Card or 7/12 Extract in Maharashtra) after a sale, gift, or inheritance. “Done at the City Survey Office, Municipal Corporation, or through a revenue officer, it records tax and other liabilities in the current owner’s name. Though it doesn’t confer ownership, mutation serves as proof of possession and lawful succession,” says Suresh Palav, partner, IndiaLaw LLP.
For inherited properties, it’s crucial to record transfer from the deceased to legal heirs through documents like a probate or succession certificate, preventing future disputes or delays in resale or redevelopment.
Ensuring a valid mother deed
Before purchasing property, the buyer should verify the complete chain of ownership documents, ensuring all past transfers were valid and registered.
“The property must comply with approved building plans, have all required no-objection certificates (NOCs) from authorities and societies, and be free from encumbrances. Buyers should also confirm that all taxes, including property tax, have been fully paid,” says Manmeet Kaur, partner, Karanjawala & Co.
Costly shortcuts buyers often take
Buyers often use power of attorney (POA) deals or unregistered sale agreements to avoid stamp duty or speed up possession, but such transfers have no legal validity after the Supreme Court’s Suraj Lamp judgment (2011), which requires a registered sale deed for ownership, according to Palav.
“It is, therefore, not advisable to execute a property transfer through a GPA (general power of attorney), as it neither confers valid title nor serves as a recognised conveyance deed in law,” says Kaur.
Relying on mutation entries, tax bills, or society receipts as proof of title is equally risky, as they are only administrative records. “Failing to verify building approvals, society consent, or encumbrance certificates can lead to disputes or an unmarketable title, while fake or revoked POAs may result in unauthorised sale or mortgage of the property,” observes Palav.
How to ensure complete title
Legal experts advise buyers to conduct thorough due diligence before purchasing property.
“Engage a qualified advocate to verify the title for at least 30 years and obtain a written title certificate. Ensure the sale deed is properly stamped and registered, and verify building plan approvals, completion certificates, and society registration. After registration, apply for mutation and secure no-dues and encumbrance certificates,” suggests Palav.
Confirm physical possession and avoid unregistered or proxy transactions. A clear, marketable title ensures legal ownership and minimises future risks.
Five mistakes buyers should avoid
Using POA-based transfers or unregistered sale agreements to save stamp duty or speed up possession: These have no legal validity
Executing a property transfer through a general power of attorney: It does not confer ownership or serve as a valid conveyance deed
Relying on mutation entries, tax bills, or society receipts as proof of title: These are only administrative records and not evidence of ownership
Failing to check building approvals, society consent, and encumbrance certificates: This can lead to disputes or an unmarketable title
Not verifying whether a POA is genuine and still valid: You run the risk of an unauthorised sale of the property through fake or revoked POAs
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