Your House Is Immovable Property, But What About The Doors?

A common man has to arm himself with the knowledge of so many things before he starts his home-buying journey. Because the transaction has major financial implications, the homebuyer would like to get some expert advice on a lot of things. However, no such guidance would be needed to tell the difference between a movable property and an immovable property. All that moves is movable and all that does not move is immovable. Who needs someone else to tell you that, right?

Let us ask you a question to find out whether you really know the difference between the two terms when it comes to matters of property. Your house is an immovable property, but are the doors and windows attached to it also immovable properties? The house cannot move without losing itself completely, but the doors and windows can very well be unattached and taken to another place, is it not? So, are the doors and windows in your house movable properties?

The answer is no, legally speaking.

What constitutes immovable property, then?

Several laws in India define what constitutes immovable property.

According to Section 3(26) of the General Clauses Act, 1897, immovable property includes "land, benefits to arise out of land, and things attached to the earth, or permanently fastened to anything attached to the earth". Section 3 (36), on the other hand, defines movable property as "property of every description, except immovable property".

The term “attached to earth is further defined in the Transfer of Property Act, 1882. According to Section 3 of the Act, things understood to be "attached to the earth" are those which are:

(a) Rooted in the earth, as in the case of trees and shrubs. However, the Act also says that the term "immovable property" does not cover standing timber, growing crops or grass.

 (b) Imbedded in the earth, as in the case of walls or buildings.

The two clauses have to be better understood via this example. A building or a house that are “embedded” to land will lose their very character in case they are made to move (in case of demolition). This will only cause loss to the holder of the property. So, these qualify to be called immovable properties. Crops, timber and grass that are “rooted” to land could be detached from the earth and be used to gain profits. (According to the Income Tax Act, if you grew trees on your land only to sell them at a later stage as timber, the income earned this way will be taxed as your business income.) That stops them from being immovable properties.

(c) Attached to what is so embedded for the permanent beneficial enjoyment of that to which it is attached.

The swimming pool in your building can be cited as an example here. Going by the legal definition, this swimming pool is “attached” to the “embedded” building. This “attached property” (the swimming pool) will cease to benefit the “embedded property” (the building) in case it is removed from its current position. This meets the condition that an object has to be “embedded for the permanent beneficial enjoyment of that to which it is attached” to be called an immovable property.

What does the real estate law say?

The recently enacted real estate law also talks about defines the term. By and large, the definition is similar to what is provided in the Transfer of Property Act and the General Clauses Act.

Section 2(Z) of the Real Estate (Regulation & Development) Act, 2016, says immovable property includes “land, buildings, rights of ways, lights or any other benefit arising out of land and things attached to the earth or permanently fastened to anything which is attached to the earth, but not standing timber, standing crops or grass".

The many fixtures

Do note here that things that are embedded and attached to the land are commonly known as fixtures. When we talk about buildings, fixtures could be of two kinds, civic fixtures and trade fixtures. While items such as doors and windows are civic fixtures machinery and other equipment are trade fixtures. Removing civic fixtures would amount to causing damages to the immovable property. That explains why the doors and windows attached in your home are part of your immovable property.

However, to qualify to be an immovable property a trade fixtures must be permanently attachment to the building and its removal will require demolition. A power generator is a trade fixtures used in housing societies. However, it is not an immovable property because it could be removed from the premises and replaced with a new one without causing any damage. On the other hand, the intricate machinery embedded in the structure to provide power back-up to a housing society might be defined as an immovable property.

Noteworthy

Do note that an asset is taxed based on it being a movable property or an immovable property. This is why it is of utmost important to know the difference between the two terms.