Auditing Real Estate Transactions

The biggest risk in real estate is not the delay but rather the unclear title. And that is what I advise every client of mine when dealing with property transactions. As ruled by the Supreme Court in Mahnoor Fatima Imran vs M/S Visweswara Infrastructure Pvt Ltd (2025), registration does not equal ownership. Your sale deed may be registered but unless the seller had a valid property title, it can still be set aside. This is where thorough title due diligence becomes crucial for anyone aiming to buy real estate, especially since verification of the seller's title is the buyer's responsibility as per Pawittar Singh Walia vs Union Territory (2012). Some of the key checks such due diligence, may include: 1) Buyer inspection under Section 55(1)(b) of Transfer of Property Act (TPA), 1882. 2) Encumbrance Certificate (EC) and Revenue Records verification 3) Conduct court litigation searches across all courts 4) Statutory Compliance and Approvals 5) Notify tenants or third-party possessions The Supreme Court has repeatedly held that buyers have the duty to verify title. Registrars only record transactions and do not verify ownership. Even if the agreement may look sound, the clauses may still hide the inconsistencies that are difficult to spot without a legal professional and proper due diligence. 

𝐀𝐫𝐞 𝐲𝐨𝐮 𝐚𝐥𝐬𝐨 𝐬𝐢𝐠𝐧𝐢𝐧𝐠 𝐜𝐨𝐦𝐦𝐞𝐫𝐜𝐢𝐚𝐥 𝐫𝐞𝐚𝐥 𝐞𝐬𝐭𝐚𝐭𝐞 𝐝𝐞𝐚𝐥𝐬 𝐰𝐢𝐭𝐡𝐨𝐮𝐭 𝐤𝐧𝐨𝐰𝐢𝐧𝐠 𝐭𝐡𝐞𝐲 𝐜𝐨𝐮𝐥𝐝 𝐝𝐞𝐬𝐭𝐫𝐨𝐲 𝐲𝐨𝐮𝐫 𝐛𝐮𝐬𝐢𝐧𝐞𝐬𝐬 𝐭𝐨𝐦𝐨𝐫𝐫𝐨𝐰? Most founders only care about commercial property transactions. And neglect legal risk reviews. And then got hit by their biggest fear. The same thing happened with a major corporation. They signed a 10-year lease for their new headquarters. Spent 2 crores on custom fit-outs, moved 200 employees, and started operations. Six months later, got an eviction notice. The property had a disputed title. The lease was unenforceable. The zoning permits were fake. This happens more than you think. Commercial real estate transactions get treated like simple paperwork. "Just a lease" they say. Until legal reality hits. 𝐈𝐟 𝐲𝐨𝐮 𝐚𝐫𝐞 𝐝𝐞𝐚𝐥𝐢𝐧𝐠 𝐰𝐢𝐭𝐡 𝐬𝐨𝐫𝐭 𝐨𝐟 𝐬𝐭𝐮𝐟𝐟, 𝐦𝐚𝐤𝐞 𝐬𝐮𝐫𝐞 𝐭𝐨 𝐟𝐨𝐥𝐥𝐨𝐰 𝐭𝐡𝐞𝐬𝐞; 1. 𝐓𝐢𝐭𝐥𝐞 & 𝐎𝐰𝐧𝐞𝐫𝐬𝐡𝐢𝐩 a. Verify legal ownership through complete title search b. Review ownership history for disputes c. heck for any pending legal claims 2. 𝐏𝐫𝐨𝐩𝐞𝐫𝐭𝐲 𝐂𝐨𝐦𝐩𝐥𝐢𝐚𝐧𝐜𝐞 a. Confirm zoning law adherence b. Validate environmental clearances c. Ensure building code compliance 3. 𝐅𝐢𝐧𝐚𝐧𝐜𝐢𝐚𝐥 𝐑𝐞𝐜𝐨𝐫𝐝𝐬 a. Examine revenue streams and expenses b. Review tax records for liabilities c. Assess operating costs and capital expenditures 4. 𝐋𝐞𝐚𝐬𝐞 𝐀𝐧𝐚𝐥𝐲𝐬𝐢𝐬 a. Study all tenant agreements b. Check payment histories c. Understand lease terms and obligations 5. 𝐑𝐢𝐬𝐤 𝐀𝐬𝐬𝐞𝐬𝐬𝐦𝐞𝐧𝐭 a. Conduct environmental site assessments b. Review insurance coverage adequacy c. Evaluate structural integrity Real estate law saves businesses from catastrophic losses. One missed step in due diligence can cost crores and years of litigation. Treat commercial property as the operational asset it is, not just paper to sign. Your business deserves legal protection that matches your investment size. Still having problems grasping all the details? Then don’t forget to check out our Commercial Property Legal Checklist to assess your current risks. #RealEstateLaw #LegalChecklist #BusinessRisk #PropertyCompliance

Think you're selling an apartment building? Think again. Walk past any multifamily property and you’ll see bricks, mortar, windows, and maybe even a freshly painted lobby. But none of that is what you’re actually selling. What matters today isn’t what you see. It’s what you can prove. Thanks to the HSTPA (Housing Stability and Tenant Protection Act), if you’re an apartment building owner in New York, your paperwork is more valuable than your penthouse views. You’re not selling a structure; you’re selling boxes of substantiation. Leases. Rent histories. Legal deregulation docs. If you can’t validate your rent roll? That building’s not worth what you think it is. And the most surprising? Even some of the most seasoned, sophisticated owners, RSA/CHIP members included, often don’t have airtight records. Every multifamily owner who even thinks they may sell in the next few years should conduct a full audit of their rent histories...now, not when a deal’s on the table and buyers start doing their own due diligence. Because in this market, the legal rent is the asset. Not the building. #AWalkDownTheStreet #BKREA #NYCRealEstate

The Supreme Court's Stance on Property Ownership: Due Diligence is Paramount A recent Supreme Court ruling has underscored the critical importance of due diligence in property transactions. The Court clarified that registration alone does not confer ownership, especially in cases of fraudulent property transfers. This landmark decision emphasizes that robust verification of property documents is essential to establish legitimate ownership and protect buyers and realtors from disputes. Key takeaways from the ruling include: * Proof of Ownership: Beyond registration, valid documents like title deeds, sale deeds, possession letters, property tax receipts, and mutation certificates are crucial for establishing ownership. * Buyer and Realtor Responsibility: Both parties must undertake thorough due diligence to avoid significant legal and financial repercussions. This includes verifying the authenticity of all transactional documents and ensuring clear title. * Protection Against Fraud: Enhanced scrutiny and comprehensive documentation serve as vital safeguards against fraudulent practices and litigation. This ruling reinforces the principle that mere registration is a procedural step, while true ownership is contingent upon a clear, verifiable chain of title and possession. Legal professionals and stakeholders in the real estate sector must be cognizant of these directives to ensure secure and legitimate property dealings. #PropertyLaw #SupremeCourt #RealEstate #DueDiligence #LegalCompliance #OwnershipRights #IndianLaw