Commercial Real Estate

7 Documents Required to Buy a Commercial Property in India

December 18, 2022
Market Of India


Buying a property is a dream for several individuals, as it is a massive investment in life. However, it takes little time to turn it into a nightmare. Buying a commercial property involves money and needs to be handled with care. If it’s a commercial property, it would involve you maintaining a checklist of documents to acquire government permissions and other required approvals from higher authorities. 

Fulfill your dream of having your commercial property by checking the allotment letter and other required documents. 

Whether you are a first-time property buyer or an experienced realtor, you require essential homework to be done from your side to verify all the legal documents while buying commercial properties in India. This is a complete guide of all the vital documents required for purchasing or possessing a commercial property in India. Let us dive into the topic.

Legal Documents Required for Commercial Business

1. Mother’s deed


A mother deed is an essential legal document in purchasing a commercial property in India. It is referred to as a parent document, which plays a pivotal role in determining the property’s origin/antecedent and ownership. 

Getting certified copies from the respective registrar’s offices is essential without a mother’s deed. It is one of the essential documents that ensures a further sale of the property in future dates, establishing or transferring new ownership. The property’s ownership change, whether through purchase, partition, gift, or inheritance, is included in the Mother Deed. The Mother Deed must record the references to previous ownership in a consistent and unbroken sequence.

2. Sales deed


It is one of the essential documents that every individual or investor must check from the respective reseller of the commercial property. It refers to a document that acts as proof of the actual transfer of ownership of the property from the buyer to the seller. Every investor must get the sales deed registered from the respective authorities involved. All the queries need to be addressed by the owner regarding the content present in the sales deed. 

The sales agreement must be thoroughly checked, with several terms and conditions, before the compliance is executed. Every seller must settle every statutory payment, property taxes and cesses, and water and electricity charges before executing the sales deed.

3. Building approval plan


This is another essential document to check before buying commercial property in India. Getting the building approval plan sanctioned by the respective Corporation or Municipal authorities is vital. The jurisdictional Commissioner or an officer authorized by such Commissioner must approve a building owner’s plan. On the other hand, the authorities agree on a building approval plan based on the zonal classification, road width, floor area ratio (FAR), and plot depth.

Several documents required for approval are as follows: 

  • Title deed
  • Property PID number
  • City survey sketch  
  • Updated tax receipt
  • Property drawings
  • Foundation certificate and demand drafts

These documents and the building approval plan give a bird view of the construction progress and status, which helps to make revisions to the property.

4. Encumbrance certificate


An encumbrance certificate ensures no dues or obligations toward the property. This document is pivotal and can be obtained from the sub-registrar’s office. An EC comprises all the registered transactions on the property during the period for which the EC is being sought. It is a certificate obtained for a specific period proving the property purchase/sale, any transaction, or the presence of a mortgage.

5. Tax receipts and stamp duty


Receipts for the property tax bills ensure the property bills are paid up-to-date and provide no dies or obligations to the government or municipality. The buyer should collect the latest tax receipts and check the details of the owner’s, taxpayer’s name, and date of the payments of the receipts. If the owner doesn’t possess the required tax receipts, as an investor, you can contact the municipal body and thoroughly check the property’s ownership. 

On the other hand, stamp duty is an instrumental legal document during the possession of the commercial property. Stamp duty is a tax similar to the sales or income tax paid and collected by government authorities or officials.

6. Khata certificate

For the registration of a new property and the transfer of a property, a Khata Certificate is required. Khata Extract is nothing more than obtaining property information from the assessment registrar. It is necessary when purchasing property and obtaining trade licenses.

7. NOC (No objection certificate)

The seller should also provide a copy of the urban non-ceiling no-objection certificate and NOCs for water, electricity, and other utilities. A No Objection Certificate helps to ensure no legal issues or disputes occur when the property is sold.

Benefits of Buying a Commercial Property


Commercial property comes with several benefits, including proper documentation that helps reduce legal disputes on issues on a further date. Let us look at several benefits of buying a commercial property, which is as follows: 

  • Equity appreciation: A commercial property proves to be a valuable asset once you gain value and equity. Proper documentation reduces several judicial prejudices or disputes and helps expand the business and enhance profitability. It also helps to boost retirement income by selling or giving the property for lease options. However, all these options are possible with adequate, thorough documentation and practicing all legal procedures. 
  • Tax benefits: When you own your practice, you can depreciate it and deduct all the interest you paid. Additionally, you enjoy several tax benefits or deductions specifically for business purposes. 
  • Flexible cash flow opportunities: You can enjoy several options to enhance the cash flow to your account while buying commercial spaces and later renting them for several purposes. However, to avoid legal disputes, it’s vital to perform commercial property registration and entail property management duties with the respective authorities.

Things to Keep in Mind While Buying Commercial Property


  • Ensure to acquire the Power of Attorney that transfers the ownership of the property from the buyer to the investor. 
  • As mentioned above, ensure to receive and check all the required tax receipts, electricity bills, water charges, and stamp duty to avoid legal disputes and ease the transfer of ownership. If the receipt is missing, you can check with the respective municipal authorities and check the ownership details. 
  • A legal instrument worth considering is the document confirming stamp duty payment. Unless otherwise specified in the agreement, the buyer is responsible for paying the stamp duty.

A Perfect Option for Commercial Investment: Invest in the Market of India

Choose the Market of India, and invest in commercial spaces that will offer a great ROI of up to 12% and help to enhance business expansions. Shops start from 29 lakhs! The market of India is India’s largest upcoming wholesale and retail market that offers excellent commercial species for you to purchase. We have 5000+ shops, 9 markets, and premium office spaces. 

Invest in the Market of India and expand your trade network, and get access to world-class amenities. 

Wrapping Up

If you are looking for a commercial property in India? Then you can invest in the Market of India, a one-stop- destination for all your commercial needs. However, you should ensure all the required documents to buy a commercial property to avoid legal disputes. We hope the above-listed points gave you insights on how to go about purchasing a commercial property and reap better returns. 


1. How do I determine if a commercial property is a good investment? 
A property with good NOI is considered a better investment, which will reap great returns. You can calculate the NOI by adding all the sources of revenue and deducting the expenses, including maintenance, mortgage, and taxes paid.
2. What are the essential documents to buy a commercial property?
As mentioned above, all the required tax receipts, stamp duty, No objection certificate, and Power of attorney needs to be acquired before buying a commercial property.
3. What average returns can one expect from commercial real estate? 
Commercial properties can generate around 6-12 percent of returns depending upon the locality, area, infrastructure, economy, and market factors.
Market of India is India's largest upcoming wholesale and retail market in Chennai. We are known for having markets and office spaces with world-class infrastructure and ancillary services. We aim to offer traders a wide range of options for commercial spaces.

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