You are on page 1of 51

1

e-Circular
CREDIT POLICY AND PROCEDURES DEPARTMENT
Sl. No. : 41/2013 - 14
Circular No. : CCO/CPPD-ADV/5/2013 - 14
Saturday, April 13, 2013.
.


The Chief General Manager
State Bank of India
LHO/MCG/CAG
CPP/SGS/Cir/5 12/04/2013

Madam/Dear Sir,
MASTER CIRCULAR ON TITLE INVESTIGATION REPORT (TIR)

Background
Law Department had issued Circular No.LAW/Cir/10 dated 29/03/2004 detailing the
process of verification of title deeds by the Advocates. Subsequent to that a number of
guidelines have been issued in this regard on various related issues from time to time.
2. Recently it has been observed that the frauds in the area related to Title Deeds are
on the rise. In view of the above, a need was felt to issue a Master Circular on TIR.

3. In supersession of existing guidelines in respect of investigation of title of immovable
properties for the purpose of creation of mortgages in favour of Bank, these instructions
are issued for the uniform application to all branches/ business units across the country
in respect of all segments.
4. Title investigation is to be conducted in respect of all types of immovable properties
that are to be accepted as mortgage security. Title investigation has the following
aspects:
i. Getting the documents of title in respect of the property examined by a panel
advocate;
ii. Scrutiny of the TIR report issued by the Advocate by the Banks dealing officials
to decide the acceptability of the advocates report; and
iii. Physical verification of the property to ensure the factual correctness of the
statements in the document/ reports.

5. Branches have to collect all details of the property including all the title documents
from the customer under proper acknowledgment and forward to the panel advocate
from whom it has been decided to obtain the Tile investigation Report (TIR).
2


TIR to be obtained only from the panel advocates identified for submission of
such reports.
Branches to correspond directly with the panel advocate and the direct
correspondence between the advocate and the borrower/ mortgagor is to be
avoided.
Advocate has to submit the TIR in the prescribed format.

6. In respect of all cases where the loan amount is more than Rs.1.00 crore, the
advocate has to make search of the title of the property for not less than 30 years
irrespective of the fact that clear and marketable title is established by a shorter search
of 13 years.
7. Irrespective of the segment, in case of all loans of Rs.1.00 crore and above,
satisfactory TIR from two different panel advocates should be obtained separately.
8. In addition to the TIR by the advocates, the branches/business units have to search
the database of CERSAI (Central Registry) and CIBIL Mortgage Check to ascertain the
existing charges and credit history of the borrower/ mortgagor. The results of such
searches are to be scrutinised as part of due diligence to rule out any doubtful
circumstances in respect of the genuineness of the security offered. Further, a copy of
screen shot of search report/ search report of CERSAI and CIBIL Mortgage Check to
be attached with the loan proposal and subsequently preserved with the security
documents.
9.The format of the letter in which the panel advocate is to be requested for submission
of TIR is given in Annexure A. The details of the Property offered as security is to be
prepared by the Branch as per Annexure-A1.The checklist cum format for the
preparation of the TIR by Advocate is given in Annexure B. Along with the report as per
Annexure B, panel advocate has to submit a certificate on title as per Annexure C.
10. In case of take over loans from other banks/financial institutions, if the original title
documents are not available for scrutiny/verification by the advocate branches may
obtain an interim certificate as per Annexure C1 along with Annexure B. However, in
all such cases, after takeover of the loan is completed and original title documents are
received from such other Banks/ Financial Institutions, Advocate has to complete the
scrutiny/ verification of original title documents and to submit the certificate of title as per
Annexure C.
11. A Guidance Note for the Advocates entrusted with the work of issuing TIR for
verifying the genuineness of the documents is given in Annexure D, which can be
made use by the branch/bank officials also. Each Circle may issue necessary additional
instructions after examining the practice followed in the State(s) and if necessary by
getting an opinion from an Advocate specialized in this area for guidance of the Panel
Advocates in the respective Circles.
12.Verification of the TIR obtained from the panel advocate by the branch/ operating
officials is also important to determine the acceptability of property offered as security. A
3

thorough and meticulous scrutiny of TIR will help not only in understanding the nature of
title of the property but also in averting any chances of fraud. A detailed checklist for
scrutiny of TIR is enclosed as Annexure E and the Branch/Business Unit has to
verify the TIR on the lines of the said Annexure.
13.Identification of the property by physical verification of the same is crucial. This
needs to be done at the time of accepting the security and cannot be postponed till to
the possible event of enforcement of security on a future date. A checklist for the
identification and physical verification of the properties offered as securities is enclosed
as Annexure F.
14.Certain important aspects relating to procedures, precautions and due diligence for
prevention of frauds, etc., in connection with the title investigation/creation of mortgage
are covered in Annexure G.
15. Panel Advocates have an important role not only in advising the legal validity of the
title of the property in question but also to guide the branches in detecting the fraudulent
attempt by any unscrupulous persons. Advocate has to make an actual and personal
inspection of relevant books and indexes maintained/kept in the office(s) of sub-
registrar, office of registrar and other relevant offices wherever applicable. The search
should cover all the sub-registrar/ registrar offices wherein the title documents are
registered as well as such offices where such registration is legally possible. Advocate
has to obtain certificates of encumbrance (EC) from the relevant offices (wherever such
facility is available) to ensure that there are no subsisting charges/encumbrance on the
property offered as security. Advocate is also required to obtain the certified copies of
all the relevant title documents directly from the office of the concerned sub-registrar/
registrar office and compare the same with the documents submitted by the customer.
They have to attach along with the Report(TIR) all such certified copies and the receipt
for fees paid for obtaining certified copies.
16. At no circumstances, the Advocate should submit a Title Investigation Report (TIR)
certifying clear and marketable title of the property with conditions or stipulations to be
complied. Further, the TIR along with all the original documents and certified copies of
documents are to be submitted directly to the Branch/BU concerned and in no
circumstances the same to be handed over to the borrower/guarantor or his/their
agent/representative.

17. The work of TIR needs to be entrusted to those panel advocates who have the
competency and expertise in doing proper title investigation as above. Wherever
possible, legal firms having such facilities and expertise may be considered for
empanelling to Banks panel of advocates for conducting TIR.
18. A separate annexure about the panel advocates to be entrusted with TIR work is
given as Annexure H. A copy of MOU to be obtained from the panel advocates who are
entrusted with the work of issuing TIR is given as Annexure H-1.
4

19. Please arrange to bring the contents of the circular to the notice of operating units /
branches under your control. Kindly note that for any clarifications in this regard Law
Department may be contacted directly.
Rationale:- To consolidate, modify and update the instructions in respect of
obtention of Title Investigation Report (TIR) for creation of mortgage.

Yours faithfully
Sd/-
for Deputy Managing Director &
Chief Credit and Risk Officer

















5

List of Annexures

Annexure Details
Annexure A Letter to the panel Advocate for search and
verification of title deeds/documents.
(To be prepared by the Branch).
Annexure A-1 Details of the property offered as the security
(To be prepared by the Branch).
Annexure B Report of Investigation of Title in respect of
immovable Property.
( To be submitted by the panel Advocate).
Annexure C Certificate on title to be submitted by the panel
Advocate.
Annexure C1 Interim certificate to be submitted by panel
Advocate in respect of takeover loans.
Annexure D Guidance Note for the Advocate verifying the
Genuineness of Title Documents.
Annexure E Checklist on scrutiny of TIR by the branches/
operating units.
(To be prepared by the Branch).
Annexure F Checklist on identification and physical verification
of the property.
(To be prepared by the Branch).
Annexure G Procedure, precautions and due-diligence.
Annexure H Review of Panel Advocates.
Annexure H-1 Memorandum of Understanding with Panel
Advocate.
Annexure I List of earlier circulars covered in this Master
Circular.





6

Annexure A: Letter to advocate for search and verification of title
deeds/documents

Dear Sir/ Madam,

You are requested to make an investigation of title to the properties more fully described
in the Schedule A-1 below, to enable us to obtain a valid and enforceable mortgage of
the said property(ies). Annexure B enclosed herein is the format for the preparation
of the title investigation report. Please note that the items sought in Annexure B are
required to be filled up by you with full details. While the items mentioned in Annexure
B are illustrative for making an effective search, we expect you to make an exhaustive
and complete search of the title of the property.

2. Please know that the responsibility of making search of the records required for the
purpose at various Govt./ registering authority/ revenue offices/ Company Registrar etc.
is entirely on you and you shall be liable for any loss caused to the bank due to
negligent search on your part or on the part of the agent/authorised representative
engaged by you for this purpose.

3. Please note that you have to make an actual and personal inspection of relevant
books and indexes maintained/kept in the office(s) of sub-registrar, office of registrar
and other relevant offices wherever applicable. The search should cover all the sub-
registrar/ registrar offices wherein the title documents are registered as well as such
offices where such registration is legally possible.

4. Please also note to obtain certificates of encumbrance (EC) from the relevant offices
(wherever such facility is available) to ensure that there are no subsisting
charges/encumbrance on the property offered as security.

5. Please do not hesitate to demand any document/record/material required by you for
the purpose of making proper investigation into the title to the property of the mortgagor.

6. The search for title/encumbrances is normally required to be made for a period of 30
years. If this is not possible for unavoidable reasons, please note that the search
should be atleast for 13 years, provided you are entirely satisfied that the 13 years
search would be sufficient in the particular facts and circumstances of the matter in
hand. If you are not fully satisfied regarding the title to the property by making an
investigation/search for a period of 13 years only, you should invariably ask for
records, documents, as you feel necessary and should verify those also for conducting
an effective search. However, in respect of security offered for loans of Rs.1.00 crore
7

and above, search for title/ encumbrances for a period of not less than 30 years is
mandatory.

7. Please note that you are required to verify the original title deeds only, particularly,
title deeds which are the subject matter of the mortgage. If the original title
deeds/documents are not available and certified extracts are produced, kindly examine
whether that should be sufficient for creation of a valid and enforceable mortgage and
state what precautions are to be taken for the purpose.

8.You are also required to obtain the certified copies of all the relevant title documents
directly from the office of the concerned sub-registrar/ registrar office and compare the
same with the documents submitted by the customer. Please also attach all such
certified copies along with your Report along with the receipt for fees paid for obtaining
certified copies.

9. In case of agricultural lands offered as security, please specify as to whether there
are any restrictions under the local laws for creation and enforceability of the mortgage
of agricultural lands.

10. In case of Lending by Consortium members/Multiple Lenders and/ or extension of
mortgages, priority of charges existing in favour of other charge holders, intervening
charges created if any will have to be verified in detail, and please advise the Bank as to
the restrictions/ limitations/ impediments, and remedial measures if any.

11. Please advise about all legal formalities/procedures required under laws to be
complied with for valid creation of mortgage in favour of the Bank. If there are any legal
impediments/restrictions, kindly advise as to whether such impediments can be cured
and if so, what procedure is to be followed.

12. Please note that at no circumstances, you should submit a title investigation report
(TIR) certifying clear and marketable title of the property with conditions or stipulations
to be complied.

13. Please sign the duplicate of this letter acknowledging the receipt of the documents
detailed in the Schedule A-1 and acceptance of the aforesaid stipulations under which
you will be providing the required search report and certificate. The format of the TIR
and Certificate on Title to be given as per Banks standard format, i.e. Annexure B and
Annexure C.

14. The TIR along with all the original documents and certified copies of documents are
to be submitted directly to the Branch/BU concerned and in no circumstances the same
to be handed over to the borrower/guarantor or his/their agent/representative.
8


15. Please acknowledge receipt.

Yours faithfully,

Signature
Name
Designation
Branch/Unit
Contact details

:



















9

Annexure-A1: Details of the property offered as the security
(To be prepared by the branch)
a)Name & Constitution of the Borrower 1.
b)Whether the loan proposal is for Rs. 1.00
crore and above? (Search for not less than 30
years is mandatory in such cases.)

2. Name and constitution of the intended
mortgagor

3. Relationship between intended mortgagor and
borrower

(Please specify whether the intended
mortgagor and borrower are one and the same
or related as guarantor, co-borrower, power of
attorney, etc.)

4. Description of property/ properties
4.1 Survey / Door No.
4.2 Extent
4.3 Location
Boundaries
East West South North
4.4

List of documents delivered to Advocate for
verification (specify original/certified extracts/
copies, etc.)

Sl.
No
Date Name/ Nature of the
Document
Original/
certified
copy/
certified
extract/
photocopy,
etc.
In case of
copies,
whether the
original was
scrutinized
by the
Branch.
5.

6. Location Details
6.1 Complete postal Address of the property/
properties.

6.2 Prominent landmark
6.3 Bus route
6.4 Bus stop
7. Rough location sketch
7.1 Approach sketch to the location
7.2 Exact location of construction/ purchase and
working plan

10

8. Please mention details about the builder (if
applicable)

8.1 Name of the Firm
8.2 Address of the Firm
8.3 Telephone No.
8.4 Contact person
8.5 Is the builder/ project in the Banks latest
approved list. Mention the date of approval of
the builder and validity of the current approval.

Yours faithfully,
Signature
Name
Designation
Branch/Unit
Contact details

11

Annexure B: Report of Investigation of Title in respect of immovable Property
(All columns/items are to be completed/commented by the panel advocate)
a)Name of the Branch/ Business Unit/Office seeking opinion.
b)Reference No. and date of the letter under the cover of which
the documents tendered for scrutiny are forwarded.

1
c)Name of the Borrower.
a)Name of the unit/concern/ company/person offering the
property/ (ies) as security.

b)Constitution of the unit/concern/ person/body/authority offering
the property for creation of charge.

2.
c)State as to under what capacity is security offered (whether as
joint applicant or borrower or as guarantor, etc.)

Complete or full description of the immovable property/
(ies) offered as security including the following details.

(a) Survey No.
(b) Door/House no. ( in case of house property)
(c) Extent/ area including plinth/ built up area in case of
house property

3.
(d) Locations like name of the place, village, city, registration,
sub-district etc. Boundaries.

a)Particulars of the documents scrutinized-serially and
chronologically.
(a) Nature of documents verified and as to whether they are
originals or certified copies or registration extracts duly certified.
Note : Only originals or certified extracts from the
registering/land/ revenue/ other authorities be examined.


Sl.
No.

Date

Name/ Nature of
the Document

Original/
certified copy/
certified extract/
photocopy, etc.


In case of
copies,
whether the
original was
scrutinized
by the
Advocate.

4.

5. Whether certified copy of all title documents are obtained from
the relevant sub-registrar office and compared with the
documents made available by the proposed mortgagor? (Please
also enclose all such certified copies and relevant fee receipts

12

along with the TIR.)
a)Whether the records of registrar office or revenue authorities
relevant to the property in question are available for verification
through any online portal or computer system?

b)If such online/computer records are available, whether any
verification or cross checking are made and the comments/
findings in this regard.

6.
c)Whether the genuineness of the stamp paper is possible to be
got verified from any online portal and if so whether such
verification was made?

a)Property offered as security falls within the jurisdiction of which
sub-registrar office?

b)Whether it is possible to have registration of documents in
respect of the property in question, at more than one office of
sub-registrar/ district registrar/ registrar- general. If so, please
name all such offices?

c)Whether search has been made at all the offices named at (b)
above?

7.
d)Whether the searches in the offices of registering authorities
or any other records reveal registration of multiple title
documents in respect of the property in question?

8. Chain of title tracing the title from the oldest title deed to
the latest title deed establishing title of the property in
question from the predecessors in title/interest to the
current title holder. And wherever Minors interest or
other clog on title is involved, search should be made for
a further period, depending on the need for clearance of
such clog on the Title.
In case of property offered as security for loans of
Rs.1.00 crore and above, search of title/
encumbrances for a period of not less than 30 years is
mandatory.(Separate Sheets may be used)

9. Nature of Title of the intended Mortgagor over the Property
(whether full ownership rights, Leasehold Rights,
Occupancy/ Possessory Rights or Inam Holder or Govt.
Grantee/Allottee etc.)

10. If leasehold, whether;
13

a)lease Deed is duly stamped and registered
b)lessee is permitted to mortgage the Leasehold right,
c)duration of the Lease/unexpired period of lease,
d)if, a sub-lease, check the lease deed in favour of Lessee as to
whether Lease deed permits sub-leasing and mortgage by Sub-
Lessee also.

e)Whether the leasehold rights permits for the creation of any
superstructure (if applicable)?

f)Right to get renewal of the leasehold rights and nature thereof.
If Govt. grant/ allotment/Lease-cum/Sale Agreement, whether;
grant/ agreement etc. provides for alienable rights to the
mortgagor with or without conditions,

the mortgagor is competent to create charge on such property,
11.
whether any permission from Govt. or any other authority is
required for creation of mortgage and if so whether such valid
permission is available.

If occupancy right, whether;
a)Such right is heritable and transferable,
12.
b)Mortgage can be created.
13. Nature of Minors interest, if any and if so, whether creation of
mortgage could be possible, the modalities/procedure to be
followed including court permission to be obtained and the
reasons for coming to such conclusion.

If the property has been transferred by way of Gift/Settlement
Deed, whether:

a) The Gift/Settlement Deed is duly stamped and registered;
b) The Gift/Settlement Deed has been attested by two
witnesses;

c) The Gift/Settlement Deed transfers the property to Donee;
d) Whether the Donee has accepted the gift by signing the
Gift/Settlement Deed or by a separated writing or by implication
or by actions;

e) Whether there is any restriction on the Donor in executing the
gift/settlement deed in question;

14.
f) Whether the Donee is in possession of the gifted property;
14

g) Whether any life interest is reserved for the Donor or any
other person and whether there is a need for any other person to
join the creation of mortgage;

h) Any other aspect affecting the validity of the title passed
through the gift/settlement deed.

15. (a) In case of partition/family settlement deeds, whether the
original deed is available for deposit. If not the
modality/procedure to be followed to create a valid and
enforceable mortgage.
(b) Whether mutation has been effected and whether the
mortgagor is in possession and enjoyment of his share.
(c) Whether the partition made is valid in law and the
mortgagor has acquired a mortgagable title thereon.
(d) In respect of partition by a decree of court, whether such
decree has become final and all other conditions/ formalities are
completed/ complied with.
(e) Whether any of the documents in question are executed
in counterparts or in more than one set? If so, additional
precautions to be taken for avoiding multiple mortgages?

Whether the title documents include any testamentary
documents /wills?
(a) In case of wills, whether the will is registered will or
unregistered will?

(b) Whether will in the matter needs a mandatory probate
and if so whether the same is probated by a competent court?

(c) Whether the property is mutated on the basis of will?
(d) Whether the original will is available?
(e) Whether the original death certificate of the testator is
available?

16.
(f) What are the circumstances and/or documents to
establish the will in question is the last and final will of the
testator?
(Comments on the circumstances such as the availability of a
declaration by all the beneficiaries about the genuineness/
validity of the will, all parties have acted upon the will, etc., which
are relevant to rely on the will, availability of Mother/Original title
deeds are to be explained.)

17. (a) Whether the property is subject to any wakf rights?
15

(b) Whether the property belongs to church/ temple or any
religious/other institutions having any restriction in creation of
charges on such properties?

(c) Precautions/ permissions, if any in respect of the above
cases for creation of mortgage?

(a) Where the property is a HUF/joint family property,
mortgage is created for family benefit/legal necessity, whether
the Major Coparceners have no objection/join in execution,
minors share if any, rights of female members etc.
18.
(b) Please also comment on any other aspect which may
adversely affect the validity of security in such cases?

(a) Whether the property belongs to any trust or is subject to
the rights of any trust?

(b) Whether the trust is a private or public trust and whether
trust deed specifically authorizes the mortgage of the property?

(c) If so additional precautions/permissions to be obtained for
creation of valid mortgage?

19.
(d) Requirements, if any for creation of mortgage as per the
central/state laws applicable to the trust in the matter.

(a) If the property is Agricultural land, whether the local laws
permit mortgage of Agricultural land and whether there are any
restrictions for creation/enforcement of mortgage.

(b) In case of agricultural property other relevant
records/documents as per local laws, if any are to be verified to
ensure the validity of the title and right to enforce the mortgage?

20.
(c) In the case of conversion of Agricultural land for
commercial purposes or otherwise, whether requisite procedure
followed/permission obtained.

21. Whether the property is affected by any local laws or other
regulations having a bearing on the creation security (viz.
Agricultural Laws, weaker Sections, minorities, Land Laws, SEZ
regulations, Costal Zone Regulations, Environmental Clearance,
etc.),

(a) Whether the property is subject to any pending or
proposed land acquisition proceedings?
22.
(b) Whether any search/enquiry is made with the Land
Acquisition Office and the outcome of such search/enquiry.

23. (a) Whether the property is involved in or subject matter of
any litigation which is pending or concluded?

16

(b) If so, whether such litigation would adversely affect the
creation of a valid mortgage or have any implication of its future
enforcement?

(c) Whether the title documents have any court seal/
marking which points out any litigation/ attachment/security to
court in respect of the property in question? In such case please
comment on such seal/marking.

(a) In case of partnership firm, whether the property belongs
to the firm and the deed is properly registered.

(b) Property belonging to partners, whether thrown on
hotchpot? Whether formalities for the same have been
completed as per applicable laws?

24.
(c) Whether the person(s) creating mortgage has/have
authority to create mortgage for and on behalf of the firm.

25. Whether the property belongs to a Limited Company, check the
Borrowing powers, Board resolution, authorisation to create
mortgage/execution of documents, Registration of any prior
charges with the Company Registrar (ROC), Articles of
Association /provision for common seal etc.

26. In case of Societies, Association, the required authority/power to
borrower and whether the mortgage can be created, and the
requisite resolutions, bye-laws.

(a) Whether any POA is involved in the chain of title?
(b) Whether the POA involved is one coupled with interest,
i.e. a Development Agreement-cum-Power of Attorney. If so,
please clarify whether the same is a registered document and
hence it has created an interest in favour of the
builder/developer and as such is irrevocable as per law.

(c) In case the title document is executed by the POA holder,
please clarify whether the POA involved is (i) one executed by
the Builders viz. Companies/ Firms/Individual or Proprietary
Concerns in favour of their Partners/ Employees/ Authorized
Representatives to sign Flat Allotment Letters, NOCs,
Agreements of Sale, Sale Deeds, etc. in favour of buyers of
flats/units (Builders POA) or (ii) other type of POA (Common
POA).

27.
(d) In case of Builders POA, whether a certified copy of POA
is available and the same has been verified/compared with the
original POA.

17

(e) In case of Common POA (i.e. POA other than Builders
POA), please clarify the following clauses in respect of POA.


i. Whether the original POA is verified and the title
investigation is done on the basis of original POA?
ii. Whether the POA is a registered one?
iii. Whether the POA is a special or general one?
iv. Whether the POA contains a specific authority for
execution of title document in question?

(f) Whether the POA was in force and not revoked or had
become invalid on the date of execution of the document in
question? (Please clarify whether the same has been
ascertained from the office of sub-registrar also?)

(g) Please comment on the genuineness of POA?
(h) The unequivocal opinion on the enforceability and validity
of the POA?

28. Whether mortgage is being created by a POA holder, check
genuineness of the Power of Attorney and the extent of the
powers given therein and whether the same is properly
executed/ stamped/ authenticated in terms of the Law of the
place, where it is executed.

29. If the property is a flat/apartment or residential/commercial
complex, check and comment on the following:
(a) Promoters/Land owners title to the land/ building;
(b) Development Agreement/Power of Attorney;
(c) Extent of authority of the Developer/builder;
(d) Independent title verification of the Land and/or building in
question;
(e) Agreement for sale (duly registered);
(f) Payment of proper stamp duty;
(g) Requirement of registration of sale agreement,
development agreement, POA, etc.;
(h) Approval of building plan, permission of appropriate/local
authority, etc.;
(i) Conveyance in favour of Society/ Condominium
concerned;
(j) Occupancy Certificate/allotment letter/letter of
possession;
(k) Membership details in the Society etc.;
(l) Share Certificates;
(m) No Objection Letter from the Society;

18

(n) All legal requirements under the local/Municipal laws,
regarding ownership of flats/Apartments/Building Regulations,
Development Control Regulations, Co-operative Societies Laws
etc.;
(o) Requirements, for noting the Bank charges on the
records of the Housing Society, if any;
(p) If the property is a vacant land and construction is yet to
be made, approval of lay-out and other precautions, if any.
(q) Whether the numbering pattern of the units/flats tally in all
documents such as approved plan, agreement plan, etc.
30. Encumbrances, Attachments, and/or claims whether of
Government, Central or State or other Local authorities or Third
Party claims, Liens etc. and details thereof.

31. The period covered under the Encumbrances Certificate and the
name of the person in whose favour the encumbrance is created
and if so, satisfaction of charge, if any.

32. Details regarding property tax or land revenue or other statutory
dues paid/payable as on date and if not paid, what remedy?

33. (a) Urban land ceiling clearance, whether required and if so,
details thereon.
(b) Whether No Objection Certificate under the Income Tax Act
is required/ obtained.

34. Details of RTC extracts/mutation extracts/ Katha extracts
pertaining to the property in question.

35. Whether the name of mortgagor is reflected as owner in the
revenue/Muncipal/Village records?

36. (a) Whether the property offered as security is clearly
demarcated?
(b) Whether the demarcation/ partition of the property is
legally valid?
(c) Whether the property has clear access as per
documents?

37. Whether the property can be identified from the following
documents, and discrepancy/doubtful circumstances, if any
revealed on such scrutiny?
(a) Document in relation to electricity connection;
(b) Document in relation to water connection;
(c) Document in relation to Sales Tax Registration, if any
applicable;
(d) Other utility bills, if any.

38. In respect of the boundaries of the property, whether there is a
19

difference/discrepancy in any of the title documents or any other
documents (such as valuation report, utility bills, etc.) or the
actual current boundary? If so please elaborate/ comment on the
same.
39.
1
If the valuation report and/or approved/ sanctioned plans are
made available, please comment on the same including the
comments on the description and boundaries of the property on
the said document and that in the title deeds.
(If the valuation report and/or approved plan are not available at
the time of preparation of TIR, please provide these comments
subsequently, on making the same available to the advocate.)

40. Any bar/restriction for creation of mortgage under any local or
special enactments, details of proper registration of documents,
payment of proper stamp duty etc.

41. Whether the Bank will be able to enforce SARFESI Act, if
required against the property offered as security?

42. In case of absence of original title deeds, details of legal and
other requirements for creation of a proper, valid and
enforceable mortgage by deposit of certified extracts duly
certified etc., as also any precaution to be taken by the Bank in
this regard.

43. Whether the governing law/constitutional documents of the
mortgagor (other than natural persons) permits creation of
mortgage and additional precautions, if any to be taken in such
cases.

44. Additional aspects relevant for investigation of title as per local
laws.

45. Additional suggestions, if any to safeguard the interest of Bank/
ensuring the perfection of security.

46. The specific persons who are required to create mortgage/to
deposit documents creating mortgage.


Note: In case separate sheets are required, the same may be used, signed and
annexed.

Date:
Place: Signature of the Advocate


20

Annexure C: Certificate of title
I have examined the Original Title Deeds intended to be deposited relating to the
schedule property/(ies) and offered as security by way of *Registered/
Equitable/English Mortgage (*please specify the kind of mortgage) and that the
documents of title referred to in the Opinion are valid evidence of Right, title and Interest
and that if the said Registered/ Equitable Mortgage is created, it will satisfy the
requirements of creation of Registered/ Equitable Mortgage and I further certify that:
2. I have examined the Documents in detail, taking into account all the Guidelines in
the check list vide Annexure B and the other relevant factors.
3. I confirm having made a search in the Land/ Revenue records. I also confirm having
verified and checked the records of the relevant Government Offices,/Sub-Registrar(s)
Office(s), Revenue Records, Municipal/ Panchayat Office, Land Acquisition Office,
Registrar of Companies Office, Wakf Board (wherever applicable). I do not find
anything adverse which would prevent the Title Holders from creating a valid Mortgage.
I am liable /responsible, if any loss is caused to the Bank due to negligence on my part
or by my agent in making search.
4. Following scrutiny of Land Records/ Revenue Records, relative Title Deeds, certified
copies of such title deeds obtained from the concerned registrar office and
encumbrance certificate (EC), I hereby certify the genuineness of the Title Deeds.
Suspicious/ Doubt, if any, has been clarified by making necessary enquiries.
5. There are no prior Mortgage/ Charges/ encumbrances whatsoever, as could be
seen from the Encumbrance Certificate for the period from _________ to __________
pertaining to the Immovable Property/(ies) covered by above said Title Deeds. The
property is free from all Encumbrances.
6. In case of second/subsequent charge in favour of the Bank, there are no other
mortgages/charges other than already stated in the Loan documents and agreed to by
the Mortgagor and the Bank (Delete, whichever is inapplicable).
7. Minor/(s) and his/ their interest in the property/(ies) is to the extent of ____________ (
Specify the share of the Minor with Name). (Strike out if not applicable).
8. The Mortgage if created, will be available to the Bank for the Liability of the Intending
Borrower, Shri/Smt/M/s. _________________
9. I certify that Shri/ Smt/ M/s. ___________________________ has / have an
absolute, clear and Marketable title over the Schedule property/ (ies). I further certify
that the above title deeds are genuine and a valid mortgage can be created and the
said Mortgage would be enforceable.


10. In case of creation of Mortgage by Deposit of title deeds, we certify that the deposit
of following title deeds/ documents would create a valid and enforceable mortgage:
a.
b.
21

11. There are no legal impediments for creation of the Mortgage under any
applicable Law/ Rules in force.

SCHEDULE OF THE PROPERTY (IES)



Place :
Date : Signature of the Advocate

















22

Annexure - C1: Certificate of Title on the Basis of Certified copies of the Title
Deeds
I have examined the Certified copies of Original Title Deeds intended to be deposited
relating to the schedule property/(ies) to be offered as security by way of *Registered/
Equitable/English Mortgage and that the certified copies of documents of title referred to
in the Opinion are valid as secondary evidence of Right, title and Interest and that the
said Registered/ Equitable Mortgage to be created on production of original title deeds
will satisfy the requirements of creation of Registered/ Equitable Mortgage and I further
certify that:
(*please specify the kind of mortgage)
2. I have examined the Certified copies of Documents in detail, taking into account all
the Guidelines in the check list vide Annexure B and the other relevant factors and
undertake to re-examine the original title deeds as and when produced and
3. I confirm having made a search in the Land/ Revenue records. I also confirm having
verified and checked the records of the relevant Government Offices,/Sub-Registrar(s)
Office(s), Revenue Records, Municipal/ Panchayat Office, Land Acquisition Office,
Registrar of Companies Office, Wakf Board (wherever applicable). I do not find
anything adverse which would prevent the Title Holders from creating a valid Mortgage
on production of the original title deeds. I am liable /responsible, if any loss is caused to
the Bank due to negligence on my part or by my agent in making search.
4. Following scrutiny of Land Records/ Revenue Records and relative Certified copies of
Title Deeds, certified copies of such title deeds obtained from the concerned registrar
office and encumbrance certificate (EC) I hereby certify the genuineness on the basis of
the certified copies of the Title Deeds. Suspicious/ Doubt, if any, has been clarified by
making necessary enquiries.
5. There are no prior Mortgage/ Charges/ encumbrances whatsoever, as could be seen
from the Encumbrance Certificate for the period from _________ to __________
pertaining to the Immovable Property/(ies) covered by above said Certified copies Title
Deeds. The property appears to be free from all Encumbrances.
6. In case of second/subsequent charge in favour of the Bank, there are no other
mortgages/charges other than already stated in the Loan documents and agreed to by
the Mortgagor and the Bank (Delete, whichever is inapplicable).
7. Minor/(s) and his/ their interest in the property/(ies) is to the extent of
_________________ ( Specify the share of the Minor with Name). (Strike out if not
applicable).
8. The Mortgage if created, will be available to the Bank for the Liability of the Intending
Borrower, Shri/Smt/M/s. _________________
9. I certify that Shri/ Smt/ M/s. ___________________________ has / have an
absolute, clear and Marketable title over the Schedule property/ (ies). I further certify
that the above certified copies of title deeds appear to be genuine and a valid mortgage
can be created on the basis of the original title deeds and the said Mortgage would be
enforceable.
23

10. In case of creation of Mortgage by Deposit of title deeds, we certify that the deposit
of original title deeds/ documents the certified copies of which have been examined
would create a valid and enforceable mortgage:-
a)
b)
There are no legal impediments for creation of the Mortgage on production of original of
title deeds the certified copies of which I have examined under any applicable Law/
Rules in force.
SCHEDULE OF THE PROPERTY/IES

Place:- Signature of the Advocate
Date:-


24

Annexure - D: Guidance Note for the Advocate verifying the Genuineness of Title
Documents
Vigilant and meticulous examination of the documents, keeping in mind the nature and
features of each document and comparison with the official records such as details
available with the office of sub-registrar or in certified copies are helpful in ensuring the
genuineness of the documents. Based on the past experience we have listed below
suspicious circumstances which would be helpful in verifying the genuineness of the
documents of title by the advocates and would serve as a guiding note. Circles may
circulate additional points based on their experience.
(a) Non-availability of a certified or scanned certified copy should be treated as
suspicious circumstance.
(b) CD numbers mentioned in the document and available with the office with which the
document was registered, do not match.
(c) Signatures of the Sub-registrar do not match.
(d) The thumb impressions or signatures of the vendors and vendee do not match.
(e) Printed photo of the vendor appears on the title deeds instead of original
photograph.
(f) Entire consideration stated in the document is paid in cash.
(g) Compare the serial number of the deed with the deed number as the serial number
of the deed is numerically larger than the deed number. In forged/fabricated/ fake
documents the serial number of the deed is sometimes numerically smaller or equal
than the deed number. These numbers would normally appear on the first page of
the registered date.
(h) On the page which is usually backside of the first page the presentation and
execution portion of the deed appears. The presentation portion is always written by
an office clerk of the Registering Official whereas the execution portion is written by
the registry office. In fake /fabricated /forged document the presentation and
execution portion are mostly in the handwriting of the same person.
(i) On the bottom portion of the back side of the first page of the registered deed, a
serial number is mentioned, next to the L.T.I. of the executant. This serial number
should be tallied with the register. In fake deeds the serial number will not tally with
serial number given in the "thumb register" of registry office.
(j) On every non-judicial stamp paper of the registered deed there are two seals. One
seal is that of the local treasury and the other is that of the registry office. On the
seal of registry office, lies the signature of the registering authority. In
fake/fabricated/forged deeds there are at times two signatures of the registering
authority.
(k) On the last page of the registered deed there has to be two seals of the registry
office along with single signature of Registering Officer (R.O.). If there is only one
seal or more signatures of the registering authority the registered deed could be a
fabricated one.
25

(l) The back portion of the last page of the registered deed bears endorsement portion
of the deed. This lies normally at the bottom of the page. The endorsement portion
mentions the deed number, page number, Zild number. and registration date i.e. the
date on which the deed was copied in the volume register. The entry of the
endorsement portion and the volume register has to be made by the same office
clerk in the same language, same handwriting and same ink pen. This endorsement
portion also bears the signature of the registering authority, who also makes single
signature in the volume register. If hand writing, language, signature and ink colour
of the endorsement portion of the registered deed differs from the entry made in
volume register, then the deed is most likely to be forged.

(m) Whenever colour photocopying is used to create fake set of documents of title, the
edges of the papers in the colour photocopies will have a different colour. This can
be observed by a close examination of the documents.

(n) If the documents are fake/forged, the watermark which appears on the general
stamp papers may not appear on the fake documents though in certain cases it has
been observed that the watermark is also present in the fake/counterfeit documents.

(o) The serial number appearing on the stamp paper can be cross checked with the
stamp office/stamp vendor to determine the fake or genuine nature of the stamp
paper.

(p) Submission of the original receipts evidencing payment of appropriate stamp duty as
well as registration fees should be insisted upon. Normally, in case of multiple copies
of title deeds, verification of appropriate payment of stamp duty after submission of
original receipts with stamp office/vendor may help in detection of the
fake/counterfeit nature of the documents of title.

(q) As per the provisions of the Indian Registration Act, the Document
Number/Registration Number would begin at No.1 on 1st January each year and
would serially end on 31st December of that year. Therefore, if the document is
registered on 3rd January of any year, the Document Number/Registration Number
will be comparatively less and it would progress serially as the year progresses,
depending upon the volume of transactions in the particular office of the Sub-
registrar/District Registrar/Registrar, as the case may be. This can be a guiding
factor for determining whether or not a document is genuine.

(r) Normally, a practice is followed by the Registration office that each volume would
contain about 200 pages. Therefore, if a title deed comprises of six pages and the
first page of this title deed is posted on or given page No.9 of Volume No.II, the said
document shall end on page 14 of that volume. Once, 200 pages are complete, the
volume number generally changes to the next one of that particular year. Therefore,
26

if the volume number of a title deed is 576 in June 2012, it shall automatically
increase in October 2012 and may be 1100, depending upon the volume of
transactions registered in that particular office of the Sub-registrar/District
Registrar/Registrar. Hence, normally page number of a title deed cannot be more
than 200 in number.

(s) Entries of book Nos. I, III and IV are always different.












27

Annexure E: Checklist for scrutiny of TIR by the branches/ operating units
The officials scrutinising the TIR need to verify and examine each and every columns/
paragraphs in the TIR and the certificate. This checklist is not in substitution but in
addition to such a scrutiny.
Name of the borrower :
Name of the Advocate submitted the TIR :
Number & Date of TIR :
Short description of the property covered by TIR:
S.No Details Y/ N
1. Whether the Advocate submitted the TIR is in Banks
panel of lawyers identified for submission of TIR?

2. Whether the report and certificate submitted by the
advocate are in the Banks prescribed format?

3. Whether the TIR by the advocate is unconditional?
4. If the TIR has any conditions, whether the same are
complied with?

5. As per the TIR, whether the documents of title are
complete in all respects and sufficient to convey a clear,
absolute and marketable title to the property

6. As per the TIR, whether the property offered as security to
the Bank is unencumbered/ unattached?

7. As per the TIR, whether the persons seeking to secure the
property to the Bank have a clear and marketable title
thereto and are legally capable of creating the charge
thereon in favour of the Bank?

8. As per the TIR, whether the property is subject to any
tenancy law which will affect the Banks rights eventually
to take possession thereof or cause it to be sold or
otherwise exercise its rights as mortgagee?

9. As per the TIR, whether the property offered is an
agricultural property and if so additional precautions in
respect of the acceptability of such security has been
examined?

10. Whether the advocate has made searches of the registers
and other records maintained by the Sub-Registrar of
Assurances, Collector and/or other revenue authorities for
ascertaining whether there is any outstanding mortgage or
charge on the property to be mortgaged to the Bank?

11. Whether the advocate has confirmed that he has
conducted independent Search in the Records of Sub-
Registrar Office(s) concerned and that the documents ,

28

convey Clear, Absolute and Marketable Title and are
sufficient for creation of a valid Mortgage?
12. Whether the TIR reveals involvement of any gift deed,
PoA, or other circumstances attracting special
precautions?

13. Whether the advocate has also submitted the fee receipt
for conducting Search in the Office of Sub-Registrar(s)
along with the TIR?

14. Whether the property particulars mentioned in the Title
Deed (Sale Deed/ Khatauni) tally with those in the Non
Encumbrance Certificate, approved Building Plan and TIR,
etc.?

15. Whether all the Original Documents and other Link
Documents as stipulated by the advocate in the TIR are
obtained?

16. In respect of loans of Rs.1.00 crore and above:
(a) Whether search of title/encumbrance was made by
the advocate for a period of not less than 30 years?
(b) Whether satisfactory search report (TIR) is obtained
from two panel advocates?

17. Whether the TIR or any other documents in the matter
reveal any pending or concluded litigation in respect of the
property offered as security and whether the impact of
such litigation has been satisfactorily explained/ got
examined?

18. (a) Findings, if any in respect of the property offered as
the security in the valuation report?
(b) Whether there is any inconsistency in the TIR and
valuation report in respect of the property?



CSO/Field Officer/
Authorised Officer
Relationship Manager/
Branch Head/Unit Head
Signature
Name
Designation
Branch/Unit
Date of scrutiny


29

Annexure F: Checklist on identification and physical verification of the property
(Physical verification of the properties mortgaged to the Bank must be meticulously
followed in case of all loans.)

Name of the Branch/ Business Unit :-
Name(s) of the Inspecting Officials :- 1.
2.
S.
No
Parameters Details Checked
(Y or N)
CSO/Field
Officer/
Authorise
d Officer
Relationship
Manager/
Branch
Head/Unit
Head
1. Name of the title holder of
the property(ies)

2. Whether Borrower/s or
Guarantor/s

3. Constitution of the
Borrowers/ Guarantors

4. Description of documents
scrutinized

5. Description of Property/
Properties (Address)

Survey / Door No.
Extent
Location


Boundaries East
West
North
South
6. Location Details
7. Prominent landmark


30


S.No Parameters Details Checked
(Y or N)
CSO/Field
Officer/
Authorised
Officer
Relationship
Manager/
Branch
Head/Unit
Head
8. Nearest Bus stop
9. Details of enquiries made
with neighbors regarding
ownership/valuation


Certificate
a) We confirm that we have personally visited the property to be accepted as Mortgage
on ------------- and certify that the details given in the TIR confirms to our finding.
b) We have enquired the price of the property in the area and we found that our
valuation in line with the trend and reasonable.
CSO/Field
Officer/Authorised
Officer
Relationship
Manager/Branch
Head/Unit Head
Signature
Name
Designation
Branch/Unit
Date





31

Annexure - G: Procedure and Precautions
A. General Procedures.
1. Procedure to be followed in handing over the documents to the advocate.
1.1. The original title deeds of the property should be handed over to the
Advocate by branches/CPCs functionaries/officer and not by the
borrower/guarantor directly. Before handing over the original documents,
branches/CPCs have to retain one set of photocopies of the documents at
their end and also to enter the details as per para. 1.2 below in the register
maintained in this regards. Any queries, clarifications of the Advocate
should be dealt with by the branch/CPC staff after getting suitable
clarifications from the borrower/guarantor /third party owning the property.

1.2. Appropriate registers are to be maintained at branches/ CPCs for handing
over and getting back the original documents from the Advocates. The
following details are to be mentioned in such registers:

1.2.1 Sl. No., Date, Name and signature of the Bank Official receiving
the documents from the borrower/guarantor;
1.2.2 Name and signature of the Bank Official handing over the
documents to Advocate;
1.2.3 The number, date, parties and description of the documents
received from Borrower/Guarantor and handed over to Advocate;
1.2.4 Date, name and signature of Advocate receiving the documents;
1.2.5 Details of document returned;
1.2.6 Date, name and signature of the advocate returning the documents;
1.2.7 Name and signature of the bank officer receiving back the
documents;
1.2.8 Remarks, if any by branch.

1.3. In exceptional cases, if the original title deeds are not available at the time
of conducting title investigation, but received at the Bank subsequent to
the obtention of TIR, the advocate has to verify/scrutinise the original title
deeds and to certify the genuineness of the original title deed and the
report already submitted will hold good for original documents
subsequently verified. In all such cases, a written confirmation from the
advocate needs to be obtained and kept on record before disbursement of
loan.
1.4. The Advocate has to take actual and personal inspection of the relevant
books and indexes maintained/kept in the office(s) of sub-registrar, office
of registrar and other relevant offices wherever applicable.
1.5. Reasonable time should be given to the Advocates to make proper
search and to conduct effective title investigation. In respect of loans other
than Home Loans, generally 10 days will be reasonable for submission of
TIR.
32

2. Procedure to be followed in Creation of Equitable Mortgage.
2.1. Once the TIR is received from the Advocate, the same should be
scrutinised as per checklist given vide Annexure E.
2.2. Obtain all the title deeds in original from the borrower in the chain of title.
Where all the originals as aforesaid are not available, minimum previous
two transactions/sale/ title deeds should be obtained from the borrower
along with a declaration explaining non availability of the original title
deeds in respect of past transaction to the satisfaction of Bank authorities.
2.3. All the original title deeds should be got deposited in the notified area and
a memorandum of entry as per prescribed format should be recorded for
the purpose of creation of mortgage.
2.4. Documents other than partition or family settlement deeds, wherever the
documents are registered in counterparts, all such counterparts available
with the mortgagor should be deposited along with the original documents
to avoid misutilisation of such counterparts.
2.5. For creating Equitable Mortgage of a flat/ independent house by a member
of Co- operative Housing Society, NOC is necessary to ensure that no
dues of the society are outstanding against such member, and a
declaration that the society has not created any prior charge over the
property which is subsisting.
2.6. A Search Report/ encumbrance certificate for the intervening period, i.e.
from the date of TIR to the date of deposit of original Title Deeds/ creation
of EM should be obtained and held on record, as part of equitable
mortgage documents.
2.7. It is to be ensured that the equitable mortgage confirmation letter by the
mortgagor is received and kept on records.
2.8. Timely execution of Sale Deed in favour of the purchaser/borrower and
completion of equitable mortgage formalities without delay, Banks charge
on property noted and possession of the property is taken by the borrower
wherever applicable are to be complied.
2.9. Building Plan approved by the Competent Authority should be obtained
and perused and evidence of Independent Site Verification should be
recorded.
2.10. A declaration-cum-affidavit should be obtained from the
borrower/guarantor/3rd party offering his/her/their property as security
declaring the following and to be kept along with mortgage documents:

2.10.1. He/she/they is/are absolute owner of the property offered as
security.
2.10.2.The title deeds deposited with/handed over to the Bank are original
title deeds in their possession and there is no title deed apart from
the deeds deposited with/handed over to the Bank.
33

2.10.3 .He/she/they have not created any charge/mortgage or any other
encumbrance on the property offered as security to the Bank.
2.10.4. He/she/they have not entered into any transaction of any nature
whatsoever in respect of the property offered as security to the
Bank.
2.10.5. There are no circumstances which adversely affect the mortgage
and its validity/enforcement.
2.10.6 . There is no tax liability, utility bills or any other dues pending in
respect of the property offered as security.
2.10.7. The property offered as security shall be available for the loan
sanctioned or to be sanctioned to the borrower.

2.11 Ensure the payment of stamp duty and registration of equitable
mortgage wherever applicable as per the relevant State laws.
2.12 Ensure the registration of equitable mortgages with the CERSAI under
SARFAESI Act as per the extant instructions in this regard.

3. Verification of the records of Central Registry.
3.1. Before creation of any mortgage the branches/ operating units have to
verify the records of the Central Registry of Securitisation, Asset
Reconstruction and Security Interest of India (CERSAI)
(www.cersai.org.in) to see that there is no pre-existing charge registered
with Central Registry. Such exercise is also to be conducted at the time of
renewal/ sanction of additional limits.
3.2. Immediately after creation of mortgages, branches have to ensure
registration of such charges with Central Registry within 30 days as per
the instructions in this regard.
4. Identification of the Property
Identification of the property is one of the most important steps to be undertaken for
creation of a valid security. Certain aspects to be kept in mind in identification of the
property are explained herein.
4.1. Demarcation
Demarcation of the property is important for its identification and possible enforcement,
if required on a later date. Hence, no property should be accepted as primary security/
collateral security if the property cannot be demarcated. The Advocates/ Valuers should
also be sensitised in this regard.
4.2. Utility Bills
Strengthening of the due diligence process and proper identification of the property are
also a part of measures to avert frauds. Therefore, in addition to all other existing
procedures, the following additional aspects shall also be dully examined and papers
relating to atleast two of the following documents should be verified along with the Title
deeds:
34

(i) Electricity Connection
(ii) Water Connection
(iii) Sales Tax Registration
Hence the above documents are also to be made available to the panel advocate
preparing the TIR and he shall furnish confirmation of having verified and taken
cognizance of the same in compiling TIR.
4.3. Approved Plans
The Valuer has to obtain a certified copy of the approved/ sanctioned plan wherever
applicable from the concerned office and to verify the same and attach it with the
valuation report.
Valuation report and certified copy of plan obtained by the Valuer should be made
available to the Advocate to verify description and boundaries of the property wherever
applicable. However, the obtention of TIR from the Advocate shall not be delayed for
getting the valuation report and certified copy of plan from the Valuer. Both the valuation
and search of title can be proceeded simultaneously and comments of the advocate on
valuation report can be obtained separately.
4.4. Mutation of the Property.
(a) The mutation of the property in the name of mortgagor should normally be
insisted upon. Exemptions should be satisfactorily explained and efforts should
be made to ensure the veracity of the reasons given by the mortgagor for non-
mutation of the property.
(b) In such cases the reasons for non-mutation should be cross checked with
Appropriate Authority (Government/Semi-Government bodies like Delhi
Development Authority-DDA, HUDA, etc.).
(c) Wherever the property is not mutated, without the personal visit to the property
by Branch Manager and/or Relationship Manager/Field Officer same should not
be accepted as security.
(d) The Panel Advocate should invariably offer his comments on non-mutation.

5. Inspection of the property
Pre-sanction and post-sanction inspection of the property proposed to be mortgaged is
to be conducted as per laid down instructions. It should comprise of the following:
i) Visit to the residence / business place of the borrower /guarantor / third party who
has offered to mortgage his property as a security.
ii) Discreet independent enquiries should be made regarding borrower(s)
/guarantor(s) /third parties, credentials and antecedents, information about their
loans, if any, availed by them from other branches / banks / institutions etc. from
the neighborhood including the actual possession/ownership of the property
offered as a security.
iii) Third party property dealer/seller/builder must be contacted independently to
verify genuineness of their offer / transaction. Credentials of third party dealer
35

/seller / builders are to be verified by discreet market enquiries and from other
dealer / seller / builders in the neighborhood.
iv) Visit to site of the property proposed to be purchased / mortgaged for physical
verification independently without assistance of borrower/guarantor and make
discreet independent enquiries with neighbor(s).
v) The existence of the property mortgaged / to be mortgaged must be verified
independently.
vi) Full description of the property with boundaries should be on record so as to
have proper identification of the property.
vii) Verification of the antecedents of the prospective customers as also the
genuineness of the documents submitted as proof of identity, residence, income
and employment should be ensured.
viii) Physical verification of the properties mortgaged to the Bank must be
meticulously followed in case of all loans.
6. Forged and Fake Documents
i) To eliminate or reduce the cases where the Bank is induced to grant finance on
the basis of forged/fake documents, one of the steps which can be implemented
is to direct the Advocate who gives TIR to procure certified copies of the title
deeds and compare the certified copies with the original documents. The
process of comparison of certified copies with the originals can in a majority of
cases, detect the fake or forged nature of documents including encumbrance
certificates and the same is to be followed in all cases.
ii) The identity of the borrower should be verified.
iii) Wherever possible the genuineness of the documents, relating to the property be
got confirmed from the concerned offices/authorities.
iv) Re-verification of loan documents / securities in respect of loans which have
slipped into NPA within a short period should be carried out to detect any
possible fraudulent submission of forged / fake title deeds.
v) Conditional search report about ownership should not be accepted without
compliance with the steps suggested by the Advocate for perfection of title or the
gaps.
vi) The charges created in Banks favor on the property should be got noted with the
appropriate authorities immediately after creation of charge/mortgage.
vii) Details regarding the verification for ensuring the genuineness of the documents
are explained separately in this circular.
B. Special Precautions.

1. Mortgage by copies of title document
Precautions to be taken in case of mortgage by certified copies for the reason that the
original documents are lost are explained herein.
36

For creation of equitable mortgage (EM), the original registered Title Documents should
invariably be deposited along with other documents. If the original registered Title
Document has been lost / misplaced and the mortgage is proposed to be created on the
basis of certified copy of the Title Document, the certified copy of the title deed should
be accepted only in exceptional cases where the original is conclusively proved to have
been destroyed or lost and after obtaining prior approval from the controlling authorities.
(In no case photocopy / laminated photocopy of the title deed is to be accepted.
Laminated original documents should also receive a more cautious approach.) Besides,
the Operating Units / Branches have to also follow strictly the undernoted procedure in
all such cases.
a) It may be confirmed that the FIR has been lodged in respect of the lost title deed.
Proof of complaint to the Police Department explaining with reasons as to when
and under what circumstances the Original Title Deeds were lost need to be
obtained.
b) Give notice to the public at large in a leading National daily and in one Regional
News Paper clearly stating that the Original Title Deeds have been lost , giving
full details of the property, and further stating that he/she wish to create charge
on the said property for availing loan/credit facility.
c) An affidavit-cum-declaration of the borrower/ guarantor is to be taken declaring
that the title deed has been lost. The affidavit should also contain i) full
particulars of the property, ii) reference to the FIR lodged and iii) the details of
advertisement published in a prominent newspaper.
d) Independent verification/ identification the property and mortgagor must be
ensured by the Operating Units.
The operating units/ branches should fully satisfy themselves in this regard as creation
of Mortgage by deposit of certified copy of the title deeds is fraught with risk.
Cases where the Original title deeds are not available, should receive more cautious
approach.
2. Mortgage by Gift Deed
Precautions in case of creation of mortgage based on gift deed are as explained herein.
Whenever any property is taken as security (primary/ collateral) based on gift deed as
the principle title deed, clearance must be obtained from the Law Department without
fail. This is in addition to obtention of TIR from the Panel Advocate as required in the
normal course. A suitable confirmation to this effect must be invariably provided in the
credit proposal submitted to the Sanctioning Authority, as a foot note under Security
column.
Independent verification/ identification the property and mortgagor must be ensured by
the Operating Units.
3. Document by Power of Attorney
Precautions in case of title document of the property is executed through Power of
Attorney are explained herein.
37

A. Legal Position of POA
Legal position in respect of execution of documents by Power of Attorney Holder is as
under:
(i) The relationship between the owner of the property and the Power of Attorney holder
is that of a Principal and Agent.
(ii) The Power of Attorney holder acts on behalf of the owner of the property as per the
authority (power) conferred on him by virtue of the power of attorney executed in this
regard. The Power of Attorney may be executed for a specific purpose or for general
purpose.
(iii) All the acts done by the Power of attorney holder in pursuance of the powers
conferred by the deed during the life time of the owner of the property (principal) are
valid and binding on the owner and as per the terms of the power of attorney, the owner
is also duty bound to ratify the same as if is done by him.
(iv) All the acts which are not within the scope of power of attorney executed in this
regard are not valid and binding on the principal (owner) even though the acts are said
to be done on behalf of the owner.
(v) When a Power of Attorney holder executes a Sale Deed, record shall be had to the
validity of the power of attorney in this regard. So long the power of attorney is in force
and not revoked, the power of attorney holder can bind the principal i.e. owner.
(vi) The Power of Attorney executed in this regard stands automatically revoked on the
death of the principal. As such during the life time of the owner/principal only the power
of attorney holder can act/execute the sale deed on this behalf.
(vii) Any sale deed executed by the Power of attorney holder after the death of the
principal is not valid and binding.
(viii) Even if the Sale Deed is executed by the Power of attorney without the knowledge
of the death of the principal/owner. It is not valid and binding.
(ix) Mere execution of Power of Attorney in favour of a person does not deprive the
original owner of his right to deal with the property independently.
(x) Notwithstanding the execution of Power of attorney, a principal (owner) can alienate
the property.
(xi) Power of attorney coupled with an interest such as the PoA embedded in a
registered Development Agreement wherein the builder/ developer is also authorized to
sell/execute sale deeds in respect of the flats/ units developed as part of such
Development Agreement stand in a different legal footing from the normal POA. Such
POA coupled with interest is covered under section 202 of the Contract Act and hence
irrevocable and not terminated by the insanity or death of the principal.
B. Precautions in case of title documents executed by POA
Cases where the title document is executed by POA holder, the complexities involved
need to be factored into the TIR obtained from the Banks empanelled advocate.
Keeping in view these complexities, the undernoted safeguards are required to be taken
care of in transactions involving POAs, to mitigate against occurrence of frauds.
38

The power of attorneys are categories into (i) Builders POA and (ii) Common POA for
the purpose of verification of the same in preparation and scrutiny of TIR. Separate
procedures are stipulated in each of the said cases. Further, a thid category of (iii)
Development Agreement-cum-Power of Attorney is also explained.
i)Builders POA
If the POA is executed by Builders viz. Companies/Firms/Individual or Proprietary
Concerns in favour of their Partners/Employees/ Authorized Representatives to sign
Flat Allotment Letters, NOCs, Agreements of Sale, Sale Deeds, etc. in favour of buyers
of flats/units, the operating units should comply with the following instructions while
handling the loan proposals:-
(a) Where the Builder is a Company:
(i) Where a particular person or two or more persons have been authorized by way of a
Board Resolution by the Company, a certified copy of the Board Resolution should be
obtained from the Builder Company along with a letter confirming that the Resolution is
still in force and has not been rescinded, modified or withdrawn.
(ii) However in cases, where two or more persons have been authorized by execution of
a Power of Attorney under the Common Seal of the Company, a certified copy of the
Power of Attorney should be obtained along with a confirmation letter that the said
Power of Attorney is still valid in force and has not been revoked or withdrawn.
(iii) The verification/comparing the certified copy with the original Power of Attorney can
be done either by the operational functionaries or by the Advocate issuing the TIR.


(b) Where the Builder is a Partnership Firm:
(i) In case of Partnership firms it is necessary that all the partners execute the Power of
Attorney in favour of the one or more persons who are authorized to sign and execute
Agreement of Sale, Sale deeds, etc. in favour of the purchaser of the flats/units.
Alternatively, one partner can be authorized specifically by the remaining partners to
execute a Power of Attorney on behalf of the firm in favour of one or more persons. This
authorization by the remaining partners in favour of one partner should be specific and
in writing.
(ii) If the Power of Attorney, issued on behalf of the firm, has been executed in
compliance of what is stated above, a certified copy of the same should be verified with
the original Power of Attorney and a confirmation letter should be obtained from the
Firm, confirming that the Power of Attorney is still valid/in force and has not been
revoked or withdrawn.
(iii) The verification/comparison of the certified copy with the original Power of Attorney
can be done either by the operational functionaries or by the Advocate issuing the TIR.
(c) Where the Builder is an Individual/Proprietary Concerns:
(i) In case of Individuals or Proprietary Concerns whenever a Power of Attorney is
executed in favour of one or more persons, a certified copy of the same should be
obtained and verified with the original Power of Attorney. Further, a letter should be
39

obtained from the Builder confirming that the Power of Attorney executed in favour of
the person/s is still valid and has not been revoked or withdrawn.
(ii) The verification/comparison of the certified copy with the original Power of Attorney
can be done either by the operational functionaries or by the Advocate issuing the TIR.
ii)Common POA
If the POA is not a Builders POA as mentioned above, the following instructions are to
be followed.
a) Wherever sale of the property is being executed by the POA holder, registration of
POA is mandatory in all cases and the Banks Advocate should mention in the TIR
that POA is alive and not revoked by any subsequent registered document.
b) Advocate should verify registered Power of Attorney and to be mentioned in the TIR.
c) The advocate should verify the genuineness of Power of Attorney (POA) in all such
cases where sale of the property is being executed by the POA holder.
d) Even when power of attorney has been registered, confirmation of the principal
should be obtained that he/she has granted the power of attorney which is still in
force and transactions already entered on the basis of power of attorney are valid
and binding on him. It is advisable to obtain a written confirmation from the Principal
confirming the sale.
e) The documents, submitted for identification of the principal, should be carefully
scrutinized. Every effort should be made to contact the Principal in person by Banks
dealing staff for ascertaining the fact that the person who executed the power of
attorney is alive or was alive at the time of execution of document.
f) If the Principal is residing in a foreign country, POA holder should submit a copy of
the passport of the principal for photo identification duly attested by the Notary public
along with the proof that the principal is alive.
g) A written communication/confirmation from the principal should be obtained
invariably with regard to the power of attorney executed by him/her.
h) All Title Investigation Reports (TIR) furnished by the Banks empanelled advocate in
respect of PoA sales, shall be vetted by the Banks Law Officer for their genuineness
and enforceability. However, in respect of loans upto an amount of Rs.30 Lacs, the
vetting by Banks Law officer can be waived subject to the condition that TIR being
furnished in respect of POA transactions is vetted by two empanelled advocates for
all centres.
i) In the light of the recent Supreme Court Judgment on POAs which ruled that
General Power of Attorney sales together with delivery of possession cannot be
treated as a sale deed conveying the title, necessary precautions need to be taken
to avoid lending against such transactions.
40

j) POAs shall be duly registered except in case of NRIs whose POA shall be attested
by Indian Embassy or notarised thereat.
k) Verification of chain of POAs is not necessary in respect of properties where:
i. Property is mutated in the name of the present owner
ii. All the relevant utility bills are transferred in the name of the present owner
iii. There should not be any dispute / litigation persisting on the POA relating to
the property under consideration
iv. Physical verification of property reports are prepared by officials of
Branch/operating units.
l) If any payment is to be made to POA holder, the POA must contain the clause that
any payment made to POA holder shall be deemed to have been received by the
principal.
m) In respect of builders where sale transactions take place on the basis of POAs for
each project, operating units are required to obtain confirmation from the principal of
the POA each time. DGM (B&O) is vested with discretion to permit relaxation.
n) Title investigation shall be done based on the original POA only.
o) TIR should contain unequivocal opinion on its nature i.e special POA or general,
enforceability and validity.
p) Ensure that same documents are deposited for mortgage as were scrutinised by
Advocate and Banks Law Officer to avoid the risk of duplicates being submitted.
q) Verify whether the POA is executed for carrying out bonafide transaction of
conveying the title to the property.
r) Verify whether the POA executed in this regard is not in lieu of the Conveyance
Deed as stated by the Honourable Supreme Court in its recent judgment.
s) Verify whether the principal/owner acted in his own right and disposed / alienated
the property notwithstanding the execution of POA which act of the Principal will
render the POA infructuous.
iii)Development Agreement-cum-Power of Attorney
In certain cases the builders enter into Development Agreement-cum-Power of Attorney
with a group of land owners, which is duly registered in the sub-registrar office, and
develop a residential project after getting necessary approvals from different statutory
authorities. The nature of Development Agreement-cum-Power of Attorney is altogether
different than the standalone POA. POAs in such cases are embedded within the
Development Agreement and are usually coupled with some consideration. Normally
builders/developers would have either paid monetary consideration to the land/property
41

owners or have agreed to give them flats or bungalows as the case may be, in the
property to be developed. Such POAs are irrevocable and applicability of POA does not
get affected due to death of the Power of Attorney granter.
In respect of Development Agreement-cum-Power of Attorney, the TIR by the advocate
should specifically state the fact of such registration of the Development Agreement with
the embedded POA therein and that it has created an interest in favour of the
builder/developer and as such is irrevocable as per law. Such TIRs may be obtained in
respect of the project as a whole, from two advocates empanelled with the Bank. In
such circumstances, Banks officials contacting the granter of the POA, embedded in
such registered agreement, is neither warranted nor be insisted upon. Also the condition
that POA granter is alive and POA has not been revoked also need not be insisted
upon. However, all other safeguards stipulated above need to be complied in respect of
Development Agreement-cum-Power of Attorney.
4. Mortgage of flats/ units in Building/ Development Project for Housing Loans
i) To mitigate the risk, Master Search of the proposed project should be carried out
by verification of original title deeds.
ii) Incorporate Builders name along with his Banks name and A/C No. on
DD/Bankers cheque.
iii) Sale consideration be remitted directly to seller in his account through RTGS/
NEFT.
iv) While carrying out post sanction inspection, directly ascertain from the Builder
/Society the genuineness of the document noting Banks Lien / transfer of share
in borrowers name.
v) Noting of Banks charge on property in Society record in cases of Housing Loans
to members of Housing Society.
vi) If there are number of housing loan cases of same type in an area, it should be
handed over to different Advocates/valuers and Branches/CPCs should not rely
upon single Advocate/valuer.
vii) In case of flats/unit of building, the original title deed(s) of the land on which the
building/project is built on/developed (mother deed) is/are may not be available
for creation of mortgage of individual flat/unit. In such cases in addition to the
original title documents in the name of first allotee/ purchaser of the flat/unit and
all the subsequent title documents, certified copy of mother deed may be
deposited for creation of mortgage. Nevertheless, in such cases, the advocate
has to scrutinise the original of the mother deed. Further, a certificate from the
Society/ Flat Owners Association/ Builder/Developer need to be obtained to see
that no prior charge/ mortgage are created and existing on the landed property
covered by the mother deed.
5. Additional Precautions in High Value Loans
i. In respect of all loan proposals, while conducting TIR in respect of property
offered as security, the Advocate has to obtain certified copies of title deeds
including minimum two previous chain title documents and/or all chain title
42

documents executed within three years from the date of the current title deed
directly from the office of the concerned sub-registrar within whose jurisdiction
the property is situated or from the sub-registrar where the documents are
registered and the Advocate has to compare all the particulars in the original
documents with the certified copies so obtained to ensure that the documents
are properly registered and there is no alteration or modification in the original
documents submitted by the borrower/ guarantor giving rise to suspicion of
genuineness of the original documents.
ii. The certified copies so obtained should also be got deposited along with the
original documents while creating the equitable mortgage.
iii. In respect of all loan proposals above Rs.1.00 crore and above, mandatory
search of title/ encumbrances for a period of not less than 30 years are to be
made by the panel advocate.
iv. In respect of loan proposals above Rs.1.00 crore and above, satisfactory search
report from two different panel advocates are to be obtained.

6. Agricultural Land as Security

i. Whenever agricultural land is involved, or is offered as a security, the TIR must
cover issues such as necessary permission for non-agricultural use, or creation
of mortgage of agricultural land for non-agricultural advances.
ii. In agriculture advance, the prospective mortgagor produces khasara and
khatauni/ jamabandi/computerized revenue record as evidence of his title, and if
no other original title deeds are available, a declaration in the form of affidavit
should be obtained explaining loss/absence of title deeds including as to how the
borrower/ guarantor became the owner of the property. In such cases, 7/12
extract /khasara and khatauni/land record of the land with all mutation entries
should be obtained. Since 7/12 extract/ khasara and khatauni/land record is not
a title deed, registered mortgage of the land should be insisted upon and after
creation of mortgage, the mutation to this effect should be got entered into the
revenue record.
iii. In case of agriculture property proposed for the purpose to secure non-
agricultural advances, the opinion of Banks Law Department/ empanelled
advocate should be obtained regarding validity and enforceability.
iv. In case of registered mortgage of agricultural property, noting of Banks charge
on property in revenue record is to be done.
v. End use of fund must be ensured Loans Sanctioned on the basis of the security
of Agricultural Property.

43

C.Due Diligence and Prevention of Frauds.

1. Need for proper due diligence.

Proper due diligence of the mortgagor by branch officials is important in ensuring that
there is no fraud in creation of security. The following are certain aspects of due
diligence.
i. Banks extant instructions from time to time in respect of KYC are to be complied
in case of all borrowers/mortgagors/ mortgagors. The copies of KYC documents
must be verified with original copy of identification/address proof by the dealing
official under his signature.
ii. KYC of the seller / builder / promoter also to be obtained as per laid down
guidelines.
iii. Branches should conduct thorough due diligence in matters like investigation of
title to the properties / verification of identity of borrower and/ or guarantor and
more so, where the mortgagor is not related to the business/ family of the
borrower.
iv. While accepting the guarantee of an individual, his/her identity and address
should be verified as per KYC guidelines and photograph should be obtained and
pasted on the relevant guarantee agreement, so that cases of impersonation by
the guarantors can be avoided. The photograph of the guarantor has to be
affixed on the guarantee agreement in the space provided, if any, or on the first
page of the guarantee agreement. Apart from the existing procedure of signing
the guarantee agreement, the Guarantor has to additionally sign across the
photograph pasted on the Guarantee agreement in such a way that part of the
signature is on guarantee agreement.
v. Wherever PAN Card is available it should invariably be verified from CBDT
website
vi. Due diligence in matters like investigation of title to the properties / verification of
identity of borrowers and/or the guarantors should be followed meticulously.
vii. Pre-sanction survey which is mandatory plays a vital role and hence needs to be
strictly followed not only in letter but spirit too. It should comprise of the following:
a. Visit to the residence/business place of the borrower /guarantor / third party
who has offered to mortgage the property as a security.
b. Discreet independent enquiries should be made regarding borrower(s) /
guarantor(s) / third parties, their credentials and antecedents from the
neighborhood and also about the possession/ownership etc.
c. Third party dealer/supplier/builder must be contacted independently to verify
genuineness of their offer/transaction.
d. Visit to site of the property proposed to be purchased / mortgaged for physical
verification must be done independently.

44

2. Certain shortcomings leading to mortgage frauds.
Certain shortcomings noticed/ observations made in respect of investigation of title
leading to frauds in mortgage are the following:
i. Investigation of the title to the properties (offered as security to the Bank) was not
properly done by the Advocates/Solicitors.
ii. Gross negligence of advocates in the scrutiny of title, particularly in respect of
housing loans.
iii. The concerned officer (s) of the branches also failed to verify the report of the
advocate properly.
iv. The securities created by the borrowers and /or guarantors turned out to be not
enforceable in the Court of law.
v. On many occasions, mortgages were created on fake/forged documents of title.
(Certain steps to be followed to ascertain the genuineness of the documents are
given separately in this circular).
vi. The identity of the borrowers and /or the guarantors was not properly verified and
mortgage by way of deposit of title deeds was created by a fake person who had
no interest in the property.
vii. The mortgage was created on the basis of certified copies of the title deeds while
prior mortgage was already created on the basis of the original title deeds.
viii. Third party guarantor who created equitable mortgage of properties of which he
had no title.
ix. Failure to verify the genuineness of the documents to the title of the property
mortgaged at the time of its acceptance and deferred such verification till the time
of initiation of recovery proceedings.
x. Certain unscrupulous builders execute multiple sale deeds/ agreement to sale in
respect of the same flat/unit to different persons which can be avoided by
conducting proper due diligence on the builder, inspection of the property and
wherever possible by finding out the total number of registered documents
executed in respect of the entire project from the office of sub-registrar.
xi. Lamination of the documents is a highly suspicious circumstance as in some
cases frauds have perpetrated based on the laminated colour copies of the
original title deeds.
45

Annexure - H : Panel Advocates

Review of panel of advocates
While selecting the advocates/solicitors for investigation/ scrutiny of title of immovable
properties, special emphasis should be laid on the choice of advocates/solicitors having
the requisite expertise and reputation in the matter of scrutiny of title deeds of properties
for conveyance.
TIR in respect of loan accounts of Rs.1.00 crore and above needs to be obtained from
panel advocates having not less than 10 years of experience in title investigation
matters.
The financial details of the proposals should not, as far as possible, (except where
search for a longer period is required) be disclosed to the advocates/solicitors and the
fees should not solely be linked to the amount of the advance.
All centres should have sufficient number of good advocates empanelled for scrutiny of
title investigation and to submit the report. Wherever possible, legal firms having
competent partners, sufficient facilities and expertise in the matters related to TIR may
be considered for empanelling to Banks panel of advocates for conducting TIR. The
performance of these advocates/firms in the Banks panel is to be monitored regularly
and at least once in a year all branches/ business units through their controller have to
submit a report to the concerned law department for the review and updating of list of
panel advocates identified for submission of TIR.
Review of the Panel of Advocates having regard to their performance, honesty and
integrity to the job assigned to them has to be made. Incompetent advocates are
required to be depanelled.
Quarterly meetings of panel lawyers identified for TIR works are to be held at RACPC
level or at District/ Taluk level to sensitise them on the various issues related to title
investigation and creation of valid mortgages.
Only in very selective cases where the advocate is found guilty of fraud, deceit,
criminal misappropriation, criminal breach of trust, forgery, malafide action, etc., Bar
Council may be approached for appropriate action against an advocate.
Remuneration to Advocate for conducting TIR
Circles should review the existing fee structure payable to the Advocates, entrusted with
TIR work and revise, wherever necessary, the remuneration having regard to the efforts
which need to be put in by the Advocates.
Memorandum of Undertaking (MOU) with the panel advocates.
A Memorandum of Undertaking (MOU) is to be entered with the empanelled advocates
for the specific purpose of obtaining TIR across all CPCs in the BPR Centres, RCPCs,
and all other Non BPR centres.
In respect of Corporate Accounts Group (CAG) and Project Finance Strategic Business
Unit (PFSBU), if the scope of work assigned to the Lenders Legal Counsel (LLC)
includes title verification of the security property, the MOU need not be entered into in
such cases. A similar approach may be followed in Mid Corporate Group also where the
46

services of LLC, with the wider scope of work including title verification, are considered
essential and proposed to be utilised accordingly. However, where the services of an
empanelled advocate is to be utilised only for the specific purpose of title verification,
the MOU as specified above is to be entered into in all such cases, irrespective of the
Business Units.
As empanelment of the advocates is centralised at Local Head Office for catering to all
the BUs falling under the same geographic region, the entering of MOUs may be
centralised at LHO / Zonal Office/ CPC or as decided by the respective Circles. The
MOU will be entered into with the panel advocates only once, initially at the time of
engaging them for title verification. In other words, the MOU should invariably be
entered into before utilising their services for title verification.
A draft copy of the MOU to be entered into with the empanelled advocates, is enclosed
as Annexure H1. If the MOU has already been obtained as per the format given in
CPPD Circular Letter No. CPP/VS/CIR/93 dated 12.12.2011 (Circular No. CCO/CPPD-
ADV/93/2011-12, dated 13.12.2011 Sl. No. 810/2011-12) there is no need for again
executing the MOU revised herein. However, if MOU is as per any other earlier format
or no MOU, the format given herein need to be used.
The Branches/ Operating Units have to ensure that the MOU is already entered into
with the panel advocates, before entrusting with them the job of title verification.
47

Annexure - H-1: Memorandum of Understanding with Panel Advocate

THIS MEMORANDUM OF UNDERSTANDING is executed at __________ this _____
day of _____________ 20___
BETWEEN STATE BANK OF INDIA, Local Head Office/Zonal Office _________ having
its office at ___________ for the brevitys sake hereinafter referred to as said Bank of
the One Part;
AND
______________________ Indian inhabitant of ___________ having Office at
__________________ for the brevity sake hereinafter referred to as said
Advocate/Solicitor/Law Firm of the Other Part:
OR
M/s. _______________________________, (Legal firm), constituted under Indian
Partnership Act, at _________________ represented by its Managing Partner
____________________ , for the brevity sake hereinafter referred to as said
Advocate/Solicitor/Law Firm of the Other Part:
OR
____________________ Ltd. Company within the meaning of Companies Act, 1956,
and having its Registered Office at __________________ represented by
____________________ , for the brevity sake hereinafter referred to as said
Advocate/Solicitor/Law Firm of the Other Part:
Whereas
The Bank as part of its business has to obtain the scrutiny of title of various immovable
properties of borrowers/ third parties for ensuring a clear, marketable and enforceable
title of such properties; and
The Advocate/Solicitor/ Law Firm is qualified and competent practice and scrutinise the
legal/title/other documents and ready to undertake the scrutiny of title of the properties;
IT IS AGREED BY THE PARTIES AS FOLLOWS:
i. The Bank does hereby engage the Advocate / Solicitor/ Law Firm to take search in
the Office of Sub-Registrar of Assurance and any other Office or authority and to submit
the Search Report and Title Certificate in respect of the immovable property/ies offered
by the client / customer of the Bank as and by way of security to create charge in favour
of the Bank for the repayment of facilities sanctioned or to be sanctioned by the Branch
of the Bank / any office or by Retail Assets Central Processing Centre (hereinafter
referred to as Branch).
ii. The Advocate / Solicitor/Law Firm shall pick up the necessary papers, deeds and
documents from the Bank at Retail Assets Central Processing Centre / Branch / Office
of the Bank in respect of immovable property in respect of which the search and title
certificate is to be submitted.
iii. The Advocate / Solicitor /Law Firm shall within two working days (excluding the date
of pick up) furnish to the Bank the title certificate and search verification report after
receipt of the entire papers in respect of property.
48

iv. The concerned Branch for which the title verification of the property is done by the
Advocate / Solicitor/ Law Firm shall pay to the Advocate / Solicitor/ Law Firm
professional fees of Rs. _______ (Rupees ____________________-stipulated amount)
plus actual
Government fees paid and expenses incurred for taking search with various authorities
upon receipt of the title verification report and title certificate against proper stamped
receipt.
v. The Advocate / Solicitor/ Law Firm shall carry out the work of search and title
verification carefully, skilfully and diligently to the best of his knowledge, skill and ability
and shall protect the interest of the Bank by scrupulously investigating and verifying the
title of the property which is offered as security.
vi It is further agreed that in case of delay caused in submitting the report to the bank,
Bank can deduct ten percent of the fee per day basis towards the penalty till the report
is submitted to the bank. It is also agreed that if such default is noticed by the Bank on
three independent occasions, the Bank is free to depanel the Advocate/Solicitor/ Law
Firm without any further notice.
vii. The Advocate/ Solicitor/ Law Firm shall verify the original registered Power of
Attorney and its genuineness and certify its validity and binding nature of the same in
his opinion.
viii. The Advocate / Solicitor/Law Firm shall take all reasonable care in making search at
various Offices, authorities and courts and shall carefully scrutinise the documents / title
deeds entrusted to him in terms of all legal requirements, and shall submit an
unambiguous and clear Certificate of title to enable the Branch / Bank to accept the
security for creation of charge / Mortgage. Any such acceptance of the security and
creation of charge / Mortgage of the property/ies in favour of the Bank, based on the
Certificate of title given by the Advocate / Solicitor / Law Firm should enable the Bank to
enforce the security on default of the Borrower / Guarantor / Mortgager as the case may
be without any legal bar or infirmity. The search at the land Registrars office should be
at least for 30 years.
ix. The Advocate / Solicitor/ Law Firm shall also bring to the notice of the Bank any
defect in the title or any other defect whatsoever, which would render creation of
Mortgage / charge invalid and not enforceable and also suggest steps necessary for
perfection of the title.
x. The Advocate / Solicitor/ Law Firm shall also submit a list of documents / title deeds
and other instruments along with his Certificate of title, the deposit of which would
ensure strict compliance with the requirements of Law and procedure relating to a valid
creation of equitable mortgage of the property in favour of the Bank.
xi. The Advocate / Solicitor/ Law Firm shall be responsible for the proper custody of the
documents / title deeds and other instruments entrusted to him and he shall be
responsible / liable for any loss / damage caused to the Bank resulting from the loss,
destruction or damage caused to such document / deeds / instruments, etc.
49

xii. The Bank shall have the right to terminate the arrangement, at any time, with or
without giving any notice, at its discretion on the grounds of incompetency, negligence,
doubtful integrity, undue delay or on any other ground and that the Advocate / Solicitor/
Law Firm shall not use the Banks / SBI's name or logo in his visiting cards / Letter
heads, etc.
xiii. The Advocate / Solicitor/ Law Firm shall as far as possible, while scrutinising the title
follow the duties and responsibilities of the Advocates in issuing Certificates of title as
laid down by the Honble Bombay High Court in Ramniklal Tulsidas Kotak Vs. M/s.
Varsha Buildings, AIR 1992 Bombay 62.
xiv. It is agreed that so long as the Advocate / Solicitor/ Law Firm is on the panel of the
Bank for the aforesaid work, the Advocate / Solicitor /Law Firm shall not act or accept
any work against the Bank in any manner whatsoever.
IN WITNESS WHEREOF the parties hereto have hereunto met and subscribed the
respective hand and seal the day and year first hereinabove written.
SIGNED SEALED AND DELIVERED By the Within named State Bank of India, Local
Head Office/ Zonal Office
In the presence of
1. _________________
2. _________________
SIGNED SEALED AND DELIVERED By the within named Advocate/ Solicitor/ Law Firm
______________________________
In the presence of _______________
1. _________________
2. _________________
50

Annexure - I : List of earlier circulars covered in this Master Circular
S.
No.
Circular No. Date Subject
1. CCO/CPPD-
EM/27/2005-06
[CPP/KKK/CIR/27 dated
04/07/2005]
12/08/2005 Creation of Equitable Mortgage
Investigation of title.
2. CCO/CPPD-
ADV/38/2005-06
(CPP/NJ/CIR/38 dated
12/08/2005]
30/08/2005 Due diligence exercise in respect of
third party guarantors.

3. CCO/CPPD-
EM/20/2006-07
[CPP/KKK/CIR/20 dated
03/06/2006]
12/06/2006 Investigation of the title deeds for
creation of Equitable Mortgage (EMs)
Advocates Report.
4. CCO/CPPD-
ADV/14/2007-08 dated
[CPP/KKK/CIR/14 dated
04/05/2007]
15/05/2007 Verification of the Title Deeds
Advocates Report.
5. CCO/COOD-
ADV/37/2009-10
[CPP/VSR/CIR/37 dated
30/07/2009]
31/07/2009 Creation of Mortgage. Acceptance of
photocopy/laminated photocopy of title
deeds.
6. CCO/CPPD-
ADV/71/2009-10
[CPP/DMR/71 dated
17/12/2009]
24/12/2009 Mortgage for deposit of Title Deeds.

7. CCO/CPPD-
ADV/49/2011-12
[CPP/SM/CIR/49 dated
28/07/2011]
29/07/2011 Investigation of the Title deeds in case
of sale of property through Power of
Attorney.
8. CCO/CPPD-
ADV/93/2011-12
[CPP/VS/CIR/93 dated
12/12/2011]
13/12/2011 Title Investigation Reports [TIR].
Memorandum of Undertaking (MoU)
with Empanelled Advocates.

9. CCO/CPPD-
ADV/94/2011-12
[CPP/CIR/VS/94 dated
15/12/2011]
17/12/2011 Investigation of Title Deeds. Creation of
Mortgage based on Gift Deed.



10. CCO/CPPD- 06/01/2012 Recommendations of Standing
51

ADV/102/2011-12
[CPP/SS/CIR/102 dated
06/01/2012]
Committee for Brain Storming on
Mortgage/Advances frauds.
11 CCO/CPPD-
ADV/126/2011-12
[CPP/VSR/CIR/126
dated 29/02/2012]
01/03/2012 Investigation of Title Deeds. Power of
Attorney.

12 CCO/CPPD-
ADV/7/2012-13
[CPPD/ARB/CIR/7 dated
30/04/2012]
02/05/2012 Investigation of Title Deeds Power of
Attorney Relaxation.

13 NBG/PBU/HL-HOME
LOANS/15/2012-13
[Cir/RE/HL/PM/15 dated
18/06/2012]
21/06/2012 Personal Banking Home Loans
Investigation of Title Deeds Power of
Attorney Clarifications.

14 CCO/CPPD-
ADV81/2012-13
[CPP/SGS/CIR/81 dated
31/10/2012]
31/10/2012 Investigation of Title Deeds for creation
of Equitable Mortgage (EMs)
Advocates Report

15 NBG/PBU/HL-HOME
LOANS/38/2012-13
[CIR/RE/HL/PM/38
dated 24/11/2012]
26/11/2012 Real Estate, Habitat & Housing
Development, Home Loans
Investigation of Title Deeds Sale of
Property through Power of Attorney
(PoA)Builders, Companies /
Firms/Individual Proprietary Concerns.
16 CCO/CPPD-
ADV/105/2012-13
[COO/CIR/VSR/105
dated 28/12/2012]
28/12/2012 Mortgage of Immovable Properties
Identification of Properties.

17. NBG/S&P-MISC/4/2012-
13[Dept. No.
[S&P/AMW/381
dated13/03/2013]
13/03/2013 Title Investigation Report for High Value
Loans.