In India land ownership is mainly established through a registered sale deed. Other documents can be used to establish the ownership include record of rights, property tax receipts and government survey documents. However these documents are not a government guaranteed title to the property but only a record for the transfer of property. It is a duty of the buyer to check the past ownership records. Land ownership can determine by accessing the land title which saves the rights of the title holder and impacts livelihoods, industrial, social and economic. However, in India land titles are unclear due to many reasons. Land is one of the unique assets because it is immovable and lands value is depend on its location. Also with the growing population its demand keeps increasing, while its supply is so limited. Access to land or land rights has a wide ranging impact on livelihoods, economic, industrial, and social growth. Land title is a document that states the land ownership. The clear land titles protect the rights of the title holder.
Why do we need clear land titles?
Land titles are not clear due to many reasons like inheritance issues from the zamindari system, gap in the legal framework and poor administration of land record. These unclear land records have create many legal issues related to land ownership and also affected the real estate sectors and agriculture. Due to disputed land titles, it leads to lack of transparency in real estate transactions making the real estate market inefficient. Execution of new projects or selling of a property requires clarity on the ownership which becomes difficult in the absence of clear title of lands. Any infrastructure created on land which is not encumbrance free can make such investment risky and can be challenged in the future. With urbanization investment in housing is growing in urban areas. Due to unclear land titles several of new housing projects can get into land ownership disputes.
Why land titles are are not cleared?
Land ownership is presumptive in India: As per the Transfer of Property Act 1882 the right to an immovable property or land can be transferred only by a registered document. It is important that such documents are registered under the Registration Act, 1908. A registered sale deed is not a governmental guarantee of the Ownership of land. Only one document cannot guarantees ownership in India. Land ownership is established through various documents as registered sale deeds, record of rights, property tax receipts, and government survey documents etc. Therefore, land ownership is presumptive in nature, and subject to challenge in India.
Cost of registration of property is very high: While registering any property transaction the buyer has to be paid a registration fee to the concerned authority along with stamp duty. Stamp duty rates across states are different and between 4% and 10%. The stamp duty is calculated as per the value of the property. In addition to the stamp duty, registration fee is an additional 0.5% to 2%, on average. This increases the cost of the property transactions leading to people avoiding registering them.
Under the Registration Act, 1908-: The registration of property for all transaction is not compulsory. These transactions include acquisition of land by the government, court orders, and property leased for less than one year. Due to the high cost of registration and registration not being compulsory many property transfers do not get registered. So the records show outdated data.
Land records do not reflect the on ground position: Land records consist of many types of information such as property details, past transactions, spatial details, mortgage details and maintained in different departments at the district or village level. Poor maintenance of land records has led to inaccuracy. In the past, states have not completed the updated records through surveys. Also Maps have not been used to establish actual property boundaries on the ground. So it has resulted in the spatial records not matching with textual records. This difference between spatial and textual records arises because partition of land and transfer either through a sale or inheritance are not recorded through surveys. For example when a owner of property died records may not be updated when the land of deceases person transferred to his legal heir. Also due to poor land records it affected the future property transactions. It becomes very difficult to access land records when data is spread across departments, but has not been updated. For finding any ownership claim on a piece of property, one has to go back several years of documents, including manual records. Such a process is inefficient and causes delays.