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Maharashtra Amendment to the Registration Act

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Through a circular dated 7 March 2013, the Maharashtra Government has implemented the provisions of Registration (Maharashtra Amendment) Act, 2010 (“Act“). The Act has been made applicable on and from 1 April 2013.

The Act brings in major changes to the Registration Act, 1908 (“Registration Act“) as applicable to the State of Maharashtra.

Few of the changes brought in by the Act are discussed below.

The Act has added certain documents which are now compulsorily registrable in Maharashtra:

(a)     Agreement relating to the deposit of title deeds, where such deposit has been made by way of security for the repayment of a loan or an existing or future debt;

(b)     Sale certificate issued by any competent officer or authority under any recovery act; and

(c)     Irrevocable power of attorney relating to transfer of immovable property in any way, executed on or after the commencement of the Act.

The Act also sets out the procedure to be followed when the immovable property is located in Maharashtra but equitable mortgage over the property is created outside Maharashtra.

In terms of the Act (Sections 89B and 89C inserted by the Act), the mortgagor creating equitable mortgage (outside Maharashtra) over an immovable property located in Maharashtra will need to send a ‘notice of intimation‘ of creation of mortgage to the Registrar within whose jurisdiction the property is located. The mortgagor sending ‘notice of intimation‘ will also need to furnish the following details to the Registrar:

(a)        names and addresses of the mortgagor and the mortgagee;

(b)        date of creation of mortgage;

(c)        amount received under the mortgage;

(d)        rate of interest payable;

(e)        list of documents deposited; and

(f)          description of the property.

If the mortgagor fails to send the ‘notice of intimation‘ to the Registrar as aforesaid and subsequently enters into a transaction related to or affecting the mortgaged property with a third party, in terms of the Act, such transaction will be void. In such situations the third party will be entitled to (a) refund of the amount paid with respect to such transactions; (b) interest at the rate of 12% from the date the amount was paid; and (c) compensation for any damages suffered by the third party.

Further, failure to send the aforesaid ‘notice of intimation‘ would lead to the mortgagor being imprisoned for a minimum term of 1 year which may extend upto 3 years and fine.

Maharashtra, as a state has the highest stamp duty rate in the country with loans and mortgages, subject to exorbirtant ad valorem stamp duties (capped at Rs 10,00,000 for mortgage). Further, Maharashtra is one of the few states to have extended the stamp duty payable on mortgage to any document evidencing deposit of title deeds (declaration of deposit and memorandum of entry, standard documentation in relation to equitable mortgage, are not, strictly speaking, instruments for the purpose of stamping). With the new amendment, the stamp duty net has become wider (a requirement for registration necessarily requiring that the document is also stamped) and now extends to equitable mortgage created outside Maharashtra for property in Maharashtra.

Anuj Sahay [anuj.sahay@pxvlaw.com]

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14 Comments

  1. JVR says:

    This is ridicululous.. there is no rationale behind this new amendment. Its just day-light robbery.
    Yesterday, I had scampered across all 3 sub-registrar office in thane district.. but no1 over there even knew wht has to be done…

  2. dattatray d pise says:

    Sirs, You have given detailed information ,Thanks
    dattapise@gmail.com

  3. sunil kumar says:

    if mortagor fails to file it with in 30 days from the mortagaging date, what happens?

  4. Ajay Marathe says:

    Is it compulsory to pay stamp duty for mortage in the state of Maharashtra if property is located in the state Maharashtra or only registration is mandatory

  5. anant d, nerurkar says:

    Mortgage by depositing title deeds need no registration. state govt. has implimented it. One must challenge the same by way of PIL/writ. Supreme court states that any instrument is prepared,then registration is compulsory. Trade/ industrial growth would hamper. In my opinion govt. has no such authority….a. d. nerurkar mobile 98214 05979 e mail adnerurkar@yahoo.com

  6. Bhavesh says:

    I failed to do mortgage registration in 30 days limit. Now i don’t know what to do? I have visited registrar office @ kalyan and HDFC bank but nobody gave me the exact procedure how to register the mortgage after 30 days time expires. Please let me know if anybody has any idea what to do in this case?

    • anant d, nerurkar says:

      Dear Bhavesh,
      Please check first with registration office at Kalyan, whether they are empowered by state. to register the document compulsorily. If you do not have any other instrument then it is not compulsory. Optional registration of any document is permisible. The registration act (Maharashtra) states that intimation should be given on payment of fees. You may intimate to general public that the property is under mortgage. This would helpful to financial institutions.
      for

    • Dhananjay says:

      what happened of your intimation of mortgage after 30 days. I am also facing the same problem? How did you manage?

  7. CA. Pravin says:

    In case of equitable mortgage, now as new amendment, the intimation letter (Intimation of deposit of title deed) is to be registered. Is this Intimation letter attracts tamp duty under category (i) or category (ii) of article 62 of schedule I of Bombay Stamp Act?

  8. Bashir Dakhwe says:

    Is it necessary/Mandatory to Register the power of attorney inrespect of the immovable property
    under the registration act 1908 as per the amemded rules.

  9. Tushar Shridhar Parab says:

    Who will be paid all charges for the same, Bank Or Person who take the loan

  10. Shikha says:

    What docuemnts are required to be submitted to the registrar inorder to have the Loan agreement / Notice of Intimation registered

  11. Yogesh says:

    Hi,

    I also failed to register my notice of intimation within 30 days.
    People even from Bank and registration office don’t have any information about this. Can anybody please help me to understand the next steps, which I need to follow.

    Thanks
    Yogesh

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