Essential Documents Required to Enter Into A JV Agreement
Whenever you purchase something as important as land or property, you know there are going to be several essential documents coming your way. These documents confirm your ownership and ensure that you avoid any potential fraud for a successful transaction.
Once your ownership is established, you must decide how to develop it. If you choose to work with builders, we suggest entering into a Joint Venture Agreement (JVA) or Joint Development Agreement (JDA). The Indian Government has revised the tax on JVAs and JDAs to facilitate rapid growth and provide affordable housing options with relaxed regulations in the market.
What is a Joint Venture Agreement?
A JVA is an important document between the landowner and builder in the property’s development process. It outlines the ownership rights of the land, the agreement to develop, and sets out the guidelines for construction. If the construction is not completed within the stipulated time frame provided, the builder may be liable to pay a specified sum.
Importance of JVA Between Landowner and Builder
The JVA has revolutionized the real estate market by allowing landowners to unlock the potential of their land, even if they lack the financial resources or knowledge to do so. This has been especially beneficial for developers who have the funds but lack access to prime locations due to the scarcity of land parcels.
Documents Required to enter a JVA
It is important to have your property valued by a registered valuer authorized by the Income Tax Department before you enter into a JVA, so as to be sure of fair transaction value and avoid tax implications. It is imperative to work with a qualified lawyer and chartered accountant to ensure that all documents are properly vetted and signed by both parties, thus ensuring that the JVA is successful.
The documents required for property development include the following:
1. Personal documents:
For the JV, the Aadhaar or PAN card of both parties along with parent land documents is essential to start construction.
2. Property tax receipts:
This file of receipts serves as proof that the property legally continues to belong to you.
3. Khata extract & certificate:
The Khata Certificate is a legal document used for computing and filing property tax furthermore contains all the property details.
4. Encumbrance certificate:
It confirms that the address on the document is the owner’s and that no pending debts are owed against the property, such as mortgages or taxes that haven’t been paid.
5. Goodwill agreement:
It means that you are investing in the builder’s good conduct and business performance. This type of agreement can be beneficial to both parties.
The City Council & Revenue Department will provide Property Tax Receipts, Khata Extract & Certificate, and Encumbrance Certificate when requested.
It is essential for both, the owner and the builder to have all their legal documentation in order.
Those looking to enter into a joint venture must do their due diligence and seek out builders who are experts in the field, such as Swathi Builders.
For inquiries about purchasing your dream home or becoming a joint venture partner, please contact us at 78459 27787 or 78459 37787.
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