While developing properties, whether residential or commercial, developers must apply for all required documents and licenses. Amongst these is the deed of declaration. This vital document plays the important role of specifying property details and notifying the government of ownership. Further, in case of any ownership dispute, this legal document can help establish rights over the property.
And to help provide clarity on the subject, here we discuss what a declaration deed is, its importance, format and most importantly, what you can do in case the declaration deed is lost or misplaced.
What is the deed of declaration?
The deed of declaration is an important document that establishes ownership and legal rights over a property. It is also known as the deed of trust. The responsibility to execute this document usually falls on the property’s developer or builder.
Since this is a legal document and can serve as proof of ownership, it is imperative that all details regarding the property are mentioned in the document. These include,
#1. Size and type of property
The declaration deed must have details on the area and type of property in question. It must specify whether it is an apartment complex, bungalow, commercial space or any other type of property.
#2. Ownership details
The trust deed must specify the owner of the property. This promotes transparency and prevents any future misunderstandings regarding ownership.
#3. Other pertinent details
The deed of declaration must also include other detailed information, such as the property's location, cost, amenities etc.
Purpose and importance of the declaration deed
The declaration deed is one of the most important property documents, not only for the developer but for the property buyers as well. Here’s why.
#1. Legal requirement
A property developer is legally required to file for a declaration deed. The purpose is to notify the government of ownership.
#2. Establishes ownership
The declaration deed acts as an undisputed proof of ownership over the property in question.
#3. Crucial document during the transfer of ownership
During property ownership transfers, transferring the declaration deed in the name of the new owner is imperative to register a change of ownership. Irrespective of whether the transfer is a result of purchase or inheritance, the deed of trust is an important document to process the change of ownership.
#4. Helps resolve property disputes
The declaration deed plays an important role in resolving disputes or challenges regarding property ownership. Since the trust deed provides undisputed proof of ownership, the party that furnishes this document proves their right over the property beyond doubt.
#5. Helps in property identification
Property developers often have various different real estate projects in the pipeline. In such cases, the declaration deed can help set each apart. Since it includes essential details such as property location, boundaries, area, ownership, and other relevant information, it can help property developers or owners identify their real estate faster.
Format of the declaration deed
A declaration deed includes all pertinent information regarding a property. While this document can be tailor-made for your requirements, a trust deed should typically include the following information.
#1. Consent of all concerned parties about the value of the property.
#2. The amount each party has contributed towards the deposit.
#3. Explanation of how all concerned parties will pay the mortgage.
#4. Details on how much of the property all concerned parties own.
#5. Details about the division of the earnings from the sale of the property.
Specifying these details in the declaration deed ensures that all details are recorded and duly acknowledged by both parties. Thereby preventing any confusion or misunderstandings that might arise in the future.
The deed of declaration of HUF
Under Hindu law, a Hindu Undivided Family (HUF) is recognised as a separate entity and even enjoys certain tax benefits. An HUF comprises of family members that share the same ancestor. The male members of an HUF are known as coparceners. The eldest coparcener is known as the Karta.
A legal document that declares the existence of an HUF is known as a deed of declaration of HUF. This typically includes the following details.
#1. Name and details of the Karta
The deed includes the name and details of the Karta, who is responsible for the management of the HUF’s income and assets.
#2. Names and details of all coparceners
All details regarding coparceners of an HUF must be mentioned in the declaration deed. This is because coparceners share legal rights to inherit the title, property and income under Hindu succession laws.
#3. Authorization statement
The deed also contains a statement affirming that the Karta is authorised to make investments and sign forms and declarations on behalf of the HUF.
#4. Undertaking
Lastly, the deed must include an undertaking to inform the relevant authority about any changes in the HUF's composition resulting from the addition or demise of a member.
What should you do if the deed of declaration is lost?
In case a deed of declaration is misplaced or lost, here are some options you can consider.
#1. Contact stakeholders
Connect with all the current and past trustees and beneficiaries who may have a copy of the deed. Additionally, you can contact banks, accounting and law firms, or any other entity that may have dealt with the deed of declaration.
#2. Source a duplicate copy
The next option you can try is contacting the solicitor or law firm that formulated the declaration deed. They might provide you with a duplicate copy or a standard deed executed at the time. In the case of the latter, since it is not the original, the trustee must sign an additional legal declaration confirming that the terms of the standard deed can be considered as those of the original.
#3. Approach the court
You can also appeal to the court to reconstruct the declaration deed, regardless of whether you have obtained a version of the original deed. You are required to submit evidence about the contents of the original declaration deed.
The court may order that the conditions of the trust be accepted if you present a copy of the original deed.
#4. Trust administration in compliance with state laws
If the above options prove unsuccessful, you can opt to administer the trust based on state laws. This process will allow you to have basic administrative powers with minimal obligations.
To conclude
A declaration deed is one of the most property documents, as it includes all essential details regarding the property, including ownership. While its typically the developer’s responsibility to undertake this trust deed, it is a valuable document for future buyers and owners as well.
When conducting transactions or fulfilling financial needs, including property investments or purchasing a dream home, having a reliable financial partner is vital. That's where Tata Capital comes in. Tata Capital understands your unique financial requirements and offers a wide range of tailored financial products and services, including home loan, designed to suit your needs. If you are considering purchasing a home or need financial assistance for property-related matters, contact Tata Capital today!
11 August 2023
6 mins read
Twitter
Facebook
Previous Post
