When acquiring or developing industrial land, it’s essential to identify any encumbrances or liens attached to the title. These legal or financial obligations can significantly affect the transaction process, delay development, or result in future liabilities. Below are five categories of encumbrances or liens that commonly impact industrial land titles:
1. Mortgages and Financial Liens
- Existing loans are secured against the land, often with banks or NBFCs.
- Non-payment can lead to foreclosure or forced auction.
- Requires full repayment or NOC (No Objection Certificate) before transfer.
- May include second or third charges not immediately visible in public records.
- Delay the acquisition until all lien holders are satisfied or cleared.
2. Litigation and Disputed Ownership
- Pending court cases involving title disputes or partition suits.
- Injunctions preventing the sale, transfer, or alteration of land.
- Claims from legal heirs or third parties contesting ownership.
- Land under investigation or claim by regulatory bodies.
- Courts may have placed restrictions on any commercial activity.
3. Government or Statutory Dues
- Unpaid property tax, land revenue, or development charges.
- Encumbrance from municipal bodies or industrial development authorities.
- Outstanding utility dues (electricity, water) recoverable against land.
- Acquisition notices or pending land acquisition under public projects.
- The government claims encroachments or unauthorized land use.
4. Easements and Usage Rights
- Legal rights granted to others for access, drainage, or utilities.
- Restricts freedom to construct or alter certain parts of the land.
- May include rights of way through the property for adjoining plots.
- It cannot be removed without a legal process or compensation.
- Recorded in the land registry or local survey records.
5. Leasehold or Tenancy Agreements
- Existing long-term leases affect vacant possession.
- Industrial lands are leased to entities that may not vacate easily.
- Tenants with protected rights under rent control or tenancy acts.
- Needs formal eviction or settlement to take possession.
- Impacts immediate use or redevelopment planning.
