Immovable Property: Types, Rights, Examples, and Legal Implications

05 JANUARY, 2023

An asset that does not have the capability to move from one place to the other is considered immovable property. In the real estate market, immovable property includes residential properties, warehouses, manufacturing units, and factories. The types of immovable property include:

Residential property such as houses and flats.
Commercial property like shops and offices.
Industrial property like factories and other industrial buildings.
Agricultural land used for farming purposes.

What Does Immovable Property Refer To?

Immovable property is anything attached to the land, such as plants or trees. Real estate comes under immovable assets, including houses, warehouses, factories, and manufacturing units. The real estate industry is also subject to legal statutes as well as taxation and TDS is applicable on immovable properties as per the prevailing rates as well. On the other hand, movable property refers to assets that can move from one place to another, such as jewellery, money, watches, etc.

Examples : Some Examples of Immovable Property:

A house, a piece of land, or a tree attached to the ground
Structures of factories
Equipment for commercial use, such as machines and receptacles
Decorative paintings, statues, and other such things are classified as immovable when they are permanently attached to the property.
Farmland and garden fertiliser
Slag dumps, mines, or quarries

Different Types of Immovable Assets

Structures: Structures are made of concrete or bricks that serve different purposes, like bridges and tunnels. These structures are designed using engineering to support heavy loads and resist damage caused by other weather conditions like earthquakes.

Landscaping: Landscaping is designing and planning pleasing outdoor spaces. It includes adding trees and plants to the area and developing them to look appealing. It also includes adding structures like ponds and waterfalls.

Differences between Immovable and Movable Properties

Moveable property	Immovable property
In the case of moveable property, no registration is required.	In order to identify the owners, proper registration must be completed in accordance with the Registration Act 1908. It is mandatory to register a property if it is worth more than Rs 100.
Purchases and ownerships of moveable property are subject to tax.	In accordance with the Indian Stamp Act, 1899, stamp duty and registration fee are imposed on immovable property transactions.
There is no difficulty in separating these properties.	There are legal procedures to follow when breaking up or dividing immovable properties.
The process of transferring ownership is very straightforward.	Ownership can only be transferred through a will, a sales deed, a gift deed, or any other agreement.
In security situations, it is referred to as a pledge.	Mortgages or liens are used for security purposes.

Rights Associated with Immovable Property

You can easily get home loans for an immovable property as it is present at a fixed place and easier to track down for financial institutions. However, the immovable property also includes items such as ships, boats and aircraft, as well as shares in companies listed on stock exchanges.

The rights associated with immovable assets are:

Right to use – it gives the owner the right to use their immovable property for any purpose they want (examples include residential or commercial spaces).
Right to transfer – this is a legal right that allows owners of immovable assets to transfer their rights by selling them through a legal contract called a sale deed or gift deed or will, depending on the type of transaction.
Right to possession – it is a right that gives the owner the sole right to occupy their immovable property.
The right to encumber is a right that allows the owner of immovable property to use their right to secure a loan or mortgage.

Other Rights on Immovable Property

Property owners have the following rights if they own immovable property. The following are among them:

Rent collection rights – Renting or leasing property is a legal way for a property owner to collect rent.
Dues collection – If the immovable property has been rented, the owner of the property may collect the dues from the tenant/person who is using it for their benefit.
Maritime rights - Maritime rights refer to the maintenance of vessels on water bodies to transport people and vehicles, as well as a ferry.
Land rights – Trespassing on public or private land is an offence in many jurisdictions.
Fishing rights – Fishing rights might be granted to an owner of immovable property in a certain water body or in a certain factory.

Immovable Property as a Gift-

According to the Income Tax Act of 1961, gifts of immovable property may be taxable. Let's look at the tax implications on immovable property as gifts.

Gift Type	Scenario	Payable Tax Amount
Unconsidered: Immovable property such as buildings, trees, and land.	50,000 rupees or more in stamp duty.	It equals the value of the property as far as stamp duty is concerned.
In consideration of buildings, trees and land that fall under the category of immovable property.	There is a difference of over Rs. 50,000 between the property's stamp duty value and its consideration.	Subtract the consideration amount from the stamp duty value of the property.

Conclusion

An immovable property can be an evergreen investment option due to its non-depreciating nature. Make sure you research properly to know your rights as an owner or tenant of immovable property.

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