land titling bill, 2010 – a critical analysis

8/8/2019 Land Titling Bill, 2010 A Critical Analysis

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Land Titling Bill, 2010 A Critical

Analysis

Nimanniyu Sharma, Intern, Kaden Boriss Legal LLP, India

Factor markets in India, be it Land or Labour, both have been in need ofreforms. Part reason for non-reform in these markets is that that they are

primarily State Subjects. But what is pertinent to note is that without reformingthem, the economys productivity cannot increase. So here, regardless of anyother regime, the most glaring problem on the pathway to reform is that of land

titling. In any law system, establishing a titling system can be a verychallenging affair. Not only has the title to be traced back to its original roots,but also title searches and grants (with costs and additional issues) are no final

guarantee of ownership.

The Rural Development Ministrys Department of Land Resources has now come

out with a draft Land Titling Bill 2010 to bring uniformity across the country and

replace the existing deeds system fraught with excessive litigation due toinaccuracies in property records. It aims to usher in a system of conclusive

property titles with title guarantees through registration of immovable propertiesand indemnification against erroneous losses. This draft had been opened forpublic discussion uptill August 31, 2010 and was placed in the public domain

then. The eventual implementation now would be depending on the statereaction for the same.

Aim and Objective discussed:

The overall idea of the Land Titling Bill, 2010 is to overhaul the current system

of maintenance of property records, as it has a lot of drawbacks. There are

numerous agencies involved in their maintenance, leading to a multiplicity ofinharmonious property records; lack of interconnectivity among these agencies,

their inefficiency and differing processes of updation of property records, allthese lead to inaccuracies in the ultimate records. What the Bill seeks toimplement is in fact, the Torrens System implemented in several other common

law countries, after its origins in Australia in 1858. The Torrens System is aLand Registration system in which the government is the keeper of all land and

title records, and a land title serves as a certificate of full, indefeasible, and validownership. In the deeds system, all titles of immovable property are presumedtitles, where title to property is claimed by people through diverse legally

recognizable instruments. Usually, it is the sale deed which is used as the primeinstrument to claim title to property. But it gives rise to litigation with different

persons furnishing different instruments to contest title claims. That is what thenew regime will seek to remove.

Now, there are several pre-requisites that need to be taken care of before theproposed land titling authority, which will be established under Section 3 of the

Bill, can start guaranteeing titles:

1) There has to be a Title Registry.2) There have to be Survey Settlements.


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3) Presence of the Land Information System.4) Property Valuation System.5) A Land Titling Tribunal, to supplant recourse to courts.6) Appropriate Technology availability to match satellite -based images with

survey records and digitized cadastral maps.

The National Land Records Modernisation Program (NLRMP) has already

undertaken computerisation of land records which includes data entry, digitizedcadastral maps and integration of textual and spatial data, strengthening of

revenue and survey training institutions, village index maps and core GIS, legal

changes and programme management. Cadastral Maps, here would meancomprehensive register of the metes-and-bounds of real property of a country. A

cadastre commonly includes details of the ownership, the tenure, the precise

location (some include GPS coordinates), the dimensions (and area), thecultivations if rural, and the value of individual parcels of land.

But even before, we can begin to discuss the actual implementation of theaforesaid requisites; the big question is that, Would all states in India be

able to implement such a System? Putting it differently, one can say thatwhile some states are efficient in administrative delivery and technologicaladvancement, others are not. Nor should one forget that various issues will crop

up if subjects like alienation of tribal land are taken into consideration as the Bill

is silent on the matter.

We, as a nation, have constitutionally fragmented the states and allowed thefragmentation to continue since Independence. Contrary to what is stated in the

Preamble of this Bill as an objective, we would not get standardisation and

unification everywhere in India. It is an impossible objective unless there is100% compliance. But at the same time, it is an important first step and onethat ought not to be restricted in its early stages. Even if one has reservations

about ownership legislation, there is no reason why laws cannot change.Establishment of property rights and conclusive titles will also encourage owners

to invest more in land.

Provisions of the Bill (In brief):

Let us examine and analyze some of the major aspects of the Draft Bill:

1. The Land Titling Authority:Chapter II of the Draft Bill is dedicated to the establishment, composition,powers, functions, duties, scope, administration and other matters related to the

Land Titling Authority. A total of twenty six functions have been prescribed underSection 4 of the Act. The Authority shall be having same powers as a Civil Court

has under Code of Civil Procedure, 1908 in the matters relating to the land titles.Apart from this it will also be empowered to exercise all the powers of the ChiefControlling Revenue Authority under the Indian Stamp Act, 1899. Now, underthe Land Titling System, the government aims to guarantee conclusive title, as

against presumed title, for every immovable property which is tagged with a

unique Property Identification Number (PIN). Titles under the new system wouldbe indefeasible i.e. title of any immovable property once entered in the Registe r

of Titles cannot be altered or made void.


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2. The Title Registry:This is perhaps going to be the biggest development of the proposed Bill. The

Authority shall, for the purpose of this Act, establish a central Title Registry for

the entire Union Territory (or the state) and may also establish sub-offices orCitizen Facilitation Centers for the proper and hassle-free receipt, recording and

maintenance of the Land Titles. The Title Authority, after survey and settlement

will prepare an Index of Maps with unique property identification numbers long

with a Register of Titles, a Register of Charges and Covenants and Register ofDisputes. These registers shall be in both, paper as well as in electronic form.

3. Survey, Settlement and Land Information System:For the facilitation of this Act, the Land Titling Authority shall establish a Survey,Settlement and Land Information division. The Director, Survey, Settlement and

Land Information System shall prepare a record of boundaries in a notified areaand give it a unique identification number after cadastral surveying and mapping

of each immovable property in the area. It shall accept request for survey ofimmovable property by any title holder or a third party on payment of fees asmay be prescribed and/or may also hire services of private licensed surveyors

for the purpose of surveying of immovable property with prior approval ofGovernment.

4. Property Valuation Division:Chapter V of the Draft Bill deals with the establishment and functioning ofProperty Valuation Division for the purpose of this Act. The Division willundertake the assessment of immovable property for the purpose of its valuation

under this Act. The valuation will also serve as a base for calculating the Stamp

Duty payable on such immovable property. Use of electronic media andinformation technology and proper software for auto-calculation of stamp duty,

registration fees and other applicable levies & fees payable on a particular

immovable property, has been advocated for. Also, the provision for prope rtyvaluation on request is prescribed on payment of requisite fees.

5. Legal Services and Title Guarantee Division:Chapter VI of the Draft Bill proposes to establish the Legal Services and TitleGuarantee Division for the purposes of this Act. The Division shall be empoweredto render the legal advice to the Land Titling Authority.

6. The Land Titling Tribunal:Chapter VII of the Draft Bill proposes to establish and constitute a Land Titling

Tribunal by Government for the purpose of this Act. The functions of t he Tribunal

are to adjudicate on the claims preferred for payment of compensation out ofthe title guarantee fund of the Authority and of the private parties authorized by

the Authority to operate such a fund. Tribunal shall hear appeals against theorders of the Land Titling Authority by an aggrieved party within three months of

date of notification of such an order and the Appeal against the order of the

Tribunal shall lie with the High Court. The Tribunal is empowered act under lawsof natural justice which provides it with necessary freedom to discharge itsduties in more timely and accurate manner. Also it provides for exclusive right of

Tribunal to hear on the matter related with land. This shall expedite the


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settlement of land dispute in our country which is typically characterized by

excessively long and harassing litigation.

7. Compulsory Intimation to the Land Titling Authority:Chapter VIII of the Draft Bill lays down different events to be compulsorily

intimated to the Land Titling Authority. These events are such which change or

are potentially capable of changing the title, ownership, beneficial ownership,control, possession, usage, obligations etc. of the immovable property and land.

This very provision will help to arrive at the conclusive legal and title status of aland and an immovable property as due to single and centralized recording of allmatters of land like transfer of legal or substantial ownership or any charge,

mortgage, covenant created on it.

8. Miscellaneous Provisions:Chapter IX is the last chapter of the Draft Bill and it deals with all themiscellaneous provisions relating to the Act. The model Draft stipulates a periodof five years from the date of promulgation of this Act for every property owners

to obtain a title from the Authority for each property. It also aims to grade every

property among small, medium and large. Section 71 grants to the employees,an immunity against any legal proceedings for anything done in good faith under

this Act.

The provisions of the Indian Stamp Act and the Indian Registration Act which are

not inconsistent with the Act when it comes into existence, will apply mutatismutandis to the relevant matters dealt with under the Act. Also, there would bea three-year challenging period in case there are ownership disputes that are yet

to be settled. No conclusive title is conferred on the property unless settled bythe tribunal to be set up by the authority. But in case there is no challenge to

the ownership of the property for three years, then the Provisi onal Title will itselfconvert to the Conclusive Title.

Enumerated Benefits:

1) Property owners will have a sense of ownership security and will be able tomortgage their property for raising loans, more easily.

2) Financial institutions will be able to check the absolute status of the propertybefore granting mortgages or loans.

3) The problem of multiple wills and fraudulent transactions will be taken careof.

4) The government will be able to curb stamp duty and property tax evasion,improving its revenue collection system alongside.

5) It has been proposed that the title documents and conclusive certificatewould include the intrinsic characteristics of properties such as mortgage,charges, liens and transaction history so, buyers who are vulnerable tomanipulations in title deeds at the hands of unscrupulous developers, would

have a mechanism at their disposal to check the health and reliability of thetitles before proceeding with the transactions.

6) Additional features, such as provision of valuation for properties and regularupdates thereof, would make it easy for the owners to keep a tab on theirworth at any given time.

7) The Bill also proposes a Central Property Valuation division which wouldmaintain a Register of property valuation that would be regularly updated .


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Such information will also be placed in the public domain and shall enable:

Auto-calculation of stamp duty, registration fee and other levies. The systemshall also provide that title holders seek valuations upon request.

8) There will be a separate division for legal services and title guarantees andthe incumbent bill proposes to set up a Title Guarantee Fund. The proposal

keeps the option open for title guarantee through private parties andinsurers.

9) The proposal and presence of a separate tribunal will clearly bring down theever-crushing burden of property claims and disputes from civil courts.

Challenges, Responsibilities and Drawbacks:

While the benefits of a clear and conclusive Land Titling System are for all to

enjoy, the Bill also proposes to confer some responsibilities on the people. Itproposes to make it compulsory for people to declare any changes in their titles.

They have to provide compulsory intimation of civil suits or appeals or revisions,

equitable mortgages, statutory charges, pending action, power of attorney,grant of succession and transaction. Penalties are prescribed for willfulconcealment of information or deliberate furnishing of false information to the

proposed land titling authority.

Also, the implementation of the Bill will be a huge challenge for the governmentas the creation of the land titling authority, the tribunal, the survey system, thelegal services and valuation cell, too, will be quite an uphill task. Regular

updates of features, such as valuation, will require an infrastructure, which atpresent does not exist. What also needs to be noted is that the proposed law will

not help the marginal farmers and people of the rural background. The reasonfor the same is that for most of these people, the work on settlement a ndrecording of land rights happened in the 1930s and 1940s. Post Independence,

the settling of land rights has been perpetually ignored. The introduction of anew system now may prove to be more cumbersome than even the actual

provisions existing today.

And at the same time, it is also pertinent to note that even some of the positiveaspects of the bill lack clarity. For instance, the bill says the titling authority willsuo moto take up irregularities in provisional titles. This provision would be

effective only if the rights of all are recorded as we ultimately come back to thevery basic statement that land is a state subject and it is also not certain if all

states would enact a Land Titling Bill or not.

land titling bill, 2010 – a critical analysis

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