In India, the land is a valuable asset; its value depends on its location and the growing population. The demand for land keeps on increasing, while the supply is limited. Access to land impacts the livelihoods, industrial, economic and social growth. The ownership of land is determined by the title of the land. The title of the land should be clear so that it protects the rights of the title-holder against the claims made by others for that particular property.
Land ownership in India is determined through different records such as sale deeds, government survey records and property tax documents, but these documents are not a guaranteed title to the property by the government as those are only a record of the transfer of property. Land records consist of types of information which are maintained in the government offices of different districts and villages. Poor land records could affect the transactions of future property.
Need For Clear Land Titles
There are various lands in India, the titles of which are unclear due to several reasons. Land titles are unclear due to legacy issues and the gaps in the legal framework, poor administration of land records and zamindari system. Thus, the unclear land records lead to legal disputes of its ownership, which affects the sector of agriculture and real estate. The land is also used as collateral for obtaining loans by farmers. Disputed lands lead to a lack of transparency in real estate transactions, making them inefficient in the market. To execute the new projects, it requires clarity on the value and ownership of the land; therefore, it becomes difficult in the absence of clear land titles.
Under new urban development schemes, cities try to raise their revenue by way of land-based on financing and property taxes. It becomes necessary to provide a clear land title in urban areas.
Why Are Land Titles Unclear?
In India, ownership of land is presumptive. The Transfer of Property Act, 1882 and the Registration Act, 1908lists down the provisions relating to the sale or transfer of the land. Therefore, the registration of the property refers to the registration of the transaction and not the title of the land. While registering the transaction of property, the buyer has to pay a registration fee along with the stamp duty. The rates of stamp duty are calculated on the cost of the property and vary from state to state.
It raises the cost of property transactions, which leads to avoiding the registration of the transaction. All transaction of the property is not mandatory to register, under the Registration Act, 1908. It includes the acquisition of land by the government, heirship partitions, court orders, and property leased for less than a year.
Land records contain various types of information such as details of the property, past transactions, details of property mortgage, etc. Mistakes are often noted in land records at the departments. For example, the transaction of a registered property through a sale deed may not be updated in the survey department.
The transfer of land or property is recorded through a sale deed, which is to be registered under the current legal framework. Transfer of land takes place through sale, purchase, mortgage, tenancy, inheritance, etc. The Transfer of Property Act, 1882 states that the right, title and the interest of the land can be transferred through a registered instrument.
According to Registration Act, 1908, while registering a sale deed, it is checked whether the last sale deed was recorded correctly. At the time of registration, the details of the buyer and seller are checked and verified through various identity proof documents. Registration of sale deed makes the document of transfer a permanent public record which helps in monitoring and verifying under whose name the land was previously registered in the land records. If a sale deed is not registered, then it is not admissible as evidence for ownership in the court of law.
The onus of checking the validity of the title of land is on the buyer. It is challenging to carry on the process of verification if the records of land are not maintained in the government departments.
In a dispute over the title of a land/property, the parties asserted that the title is placed on their name and it should be reflected in the revenue records. Recently in January 2019, in the case â€˜Smt. BhimabaiMahadeoKambekarVs, Arthur Import and Export Companyâ€™, the Supreme Court clarified the law that the mutation entry of land in the revenue records does not create or extinguish the title over the land. The mutation entries are maintained for the commercial purpose and to ensure that the land revenue is paid by the person whose name is recorded.
The records maintained are supposed to reflect the changes as some transactions like gift deed are to be kept in revenue records and not necessarily required to be registered under the registration act. Since land is a concurrent subject in Indian Constitution, both centre and state have law-making power.
The Indian Constitution has clubbed the maintenance of land records, land revenue, survey and records of right in the State List. Whereas in Concurrent list, the subjects listed by parliament are stamp duty, registration act, transfer of property act, etc. have a direct bearing on land records. In order to rectify the anomaly in the land situation, the central government had drafted the Model Land Titling Bill, 2011, which aimed to move towards establishing the titles under the government notification. The government launched the National Land records Modernizing Program 2008 to address the issue of land titling in India.
Unfortunately, due to some primary reasons like unexplained clarification of inadequate land records, unexplained functioning of authorities in the current system, the bill did not create many blends in the State Legislature.
In R.SureshBabuvsG.Rajalingam And 2 Others, the High Court of Andhra Pradesh stated that the registration of every document is compulsory under the Indian Registration Act. Such document if not registered, will not be allowed/ enforceable for the purpose of specific performance. Any unregistered document will not be allowed to submit as proof of the act of registration or any claim for any property. Such a document will not be admissible in the court of law. This decision provided by the Andhra Pradesh High Court is subject to changes if appealed in the Supreme Court.
After the enactment of the Real Estate Regulation Act (RERA), 2016 mandates the State Government to title the upcoming real estate transaction. It has put a significant impact on the poor records of titles. The system of maintaining records envisaged under the Registration Act runs parallel to the records maintained by the revenue department. Real estate has become an area where the absence of a transparent system of titling has an enormous transaction cost.
A solution to the problem of land titling lies in the upcoming technology drive that should be initiated in the legislative. The use of artificial intelligence-based solutions can be used to track the illegal constructions and incomplete title records of land.