@Indrashis, The encumbrance certificate is a mandatory document used in property transactions as an evidence of free title/ownership. When buying a house, flat or plot, it is important to verify that the property does not have any monetary or legal dues. An encumbrance certificate contains all the transactions registered relating to a particular property for a certain period (as required). These details also consist any claims or encumbrance on the property. For more details, please refer to this link: http://www.99acres.com/articles/property-trendz/299-what-you-must-check-before-signing-on-the-dotted-line.html
1) Non-Encumbrance Certificate : In any transaction of sale or purchase of property, a 'no encumbrance certificate' is a very important document. This certificate is also issued for the purpose of mortgaging a property while seeking a loan. The certificate certifies that the property in question is not already mortgaged.
2) Property search/inspection : No encumbrance certificate' is one of the very important documents. There are other things needs to be considered also during property search which is listed in following link.