Clear Property Titles: Rajasthan Shows The Way

In a big leap for land reforms, the Vasundhra Raje-led state government recently passed the Rajasthan Urban Land (Certification of Titles) Bill, making Rajasthan the first state to have a dedicated law on property titles.

Currently, we are governed by the concept of “presumed ownership”, which means that no single document is a conclusive proof of our ownership over a property. This often results in long-drawn court battles, delays in development works, and poor economic growth.

The purpose of a sale deed or registration of property is not to transfer the conclusive ownership over a property but an acknowledgment that a particular transaction took between the parties concerned. Though the state receives certain revenues in the form of stamp duty from such registrations, it does not cast upon itself any responsibility to guarantee that the seller is the indisputable owner.

Any bank mortgage on property, a legal dispute pending before the court, and other family disputes might have to be borne by the subsequent buyer, as property registration did not guarantee him absolute rights over the property. That is primarily the reason why land acquisition, land inheritance, pooling, taxation, division, etc, are cumbersome processes, because usually there is no clear title and a dispute arises after a transaction has taken place.

There are three basic pillars on which the land policy should rest. First, land records pertaining to ownership should be formally maintained. Second, an ease to carry out transactions, so that the property sale and purchase can be easily undertaken. And third, there must be a transparent and trustworthy system of property evaluation. All these parameters are theoretically present in India but hardly put to practice.

Although the Reserve Bank of India, the erstwhile Planning Commission, and various central and state governments have from time to time reiterated the need to have a system where clear titles are guaranteed to properties, the difficulty in its implementation and likely political repercussions have dissuaded successive governments from acting upon it.

To be implemented in a phased manner, the Rajasthan Urban Land (Certification of Titles) law will first be launched in a few districts as a pilot, and then rolled out across the state. Here are the highlights of the proposed law:

Land Title Certification (LTC): This has been kept as mandatory in select areas and will mostly be optional for the owner of a property. To promote LTC, the fees have been kept within the common man's reach, at only 0.05 per cent of the transaction value.

LTC Authority: An independent authority will be created to serve as the custodian of register of title certificates and register of survey records.

Tribunal: A tribunal will be set up to look into the orders passed by the authority.

Sinking fund: A 'sinking fund' has been proposed to be created under which genuine claimants will be compensated.

CLEAR (Computerised Land Evaluation and Administration of Records): It will be a digital platform to facilitate the management and recording of the documents pertaining to the new legislation.

Mapping of properties: An exhaustive drive will be conducted to map, survey and identify properties. The mutations over such properties occurring thereafter shall be registered, so that records are updated routinely.

The new legislation is seen going a long way in promoting development in Rajasthan. Property transactions will become easy and transparent, assuring buyers that they are the rightful owners of the property. The law will also give a leg-up to the central government's move to enhance 'ease of doing business' in the country.