When buying or managing property in Karnataka, two important documents you’ll frequently come across are the Encumbrance Certificate (EC) and the Khata. Both play crucial roles in property transactions and legal compliance, but they serve different purposes. In this blog, we’ll explain the differences between EC and Khata and why each is essential for property ownership.

What is an Encumbrance Certificate (EC)?

The Encumbrance Certificate (EC) is a legal document that certifies whether a property is free of financial or legal liabilities, such as mortgages, loans, or claims by third parties. It is typically issued by the Sub-Registrar’s Office and is essential when purchasing or selling property, or applying for a loan.

Key Features of EC:

1. Proof of Clear Title: An EC is proof that the property is free of any encumbrances (liens or claims) and that the owner has a clear, marketable title.

2. Transaction History: The EC records all property transactions over a specified period, including details of sales, transfers, and loans against the property.

3. Required for Loans and Transfers: Lenders often require an EC when you apply for a home loan or mortgage, as it confirms that the property is not already pledged.

4. Time Frame: You can request an EC for any period of time, typically ranging from the last 13 to 30 years, depending on the requirement.

What is Khata?

Khata is a document that indicates that a property is registered with the local municipal authority, such as the Bruhat Bengaluru Mahanagara Palike (BBMP) or other municipal bodies in Karnataka. It is essential for assessing property taxes and legalizing property ownership.

Key Features of Khata:

1. Property Registration: Khata is proof that the property is recorded in the municipality’s property register, which is necessary for tax purposes and compliance with local regulations.

2. Property Tax Assessment: Khata contains important information about the property, including its location, size, usage (residential/commercial), and ownership. This information is used to calculate property taxes.

3. Building Permits and Loans: A property with an A Khata is considered legally compliant and is eligible for building permits and loans. e-Khata, the digital version of Khata, offers online access to these records.

4. Legal Compliance: Having an A Khata (or e-Khata) ensures that the property complies with zoning laws, building bylaws, and municipal regulations. A B Khata, on the other hand, indicates that the property is not fully compliant and may require regularization.

Key Differences Between EC and Khata

Why Do You Need Both?

Both EC and Khata are crucial documents for property owners and buyers in Karnataka. The EC is required to confirm that the property has a clear and marketable title, while the Khata is needed for registering the property with the municipality and paying taxes.

• For Property Buyers: It is essential to verify the EC to ensure there are no encumbrances, and the Khata to ensure the property is legally registered and compliant with local regulations.
• For Property Owners: Maintaining an up-to-date Khata is important for property tax compliance, and an EC may be required if you plan to sell the property or apply for a mortgage.

Conclusion

While the Encumbrance Certificate (EC) and Khata serve different purposes, both are essential for ensuring that a property is legally sound and free from liabilities. Understanding the role of each document will help you manage your property efficiently and avoid any legal complications in the future.