Indian Real Estate market is one of the prime revenue generating sectors in India, which off late has resulted in a surge in registration of real estate transactions. Land is characterised by its ability of instant wealth generation, capable of being sold, mortgaged, gifted, inherited and bequeathed. With a surge in land registry there has been an increased reporting of frauds in land registry. Discovering that your most prized possession being your land is stolen by an unidentifiable criminal comes as a major setback to the innocent land owners. This article provides its readers with a holistic view of the prevailing real estate frauds and scams, the government’s initiative to combat these frauds and concludes with the author’s recommendations to make the government’s action plan a full proof device to prevent frauds in land registry.
India is a diverse geographical country comprising of 28 states, 8 union territories, housing multi lingual residents, sheltering about 17.7% of world’s population and having a total geographic area of 3,287,240 sq.km, wherein 91% of the area is covered by land and remaining by water. Ensuring proper land governance for such a huge geographical area is indeed an act of great responsibility. In India all the deeds and documents pertaining to real estate are registered under the Registration Act, 1908. However it is seldom observed and noticed that even though the Registration Act provides for mandatory registration of title and documents pertaining to property, there is no concept of registration of title or ownership under the Act. Thus the title derived by placing reliance on such registered deeds and documents is merely presumptive and not confirmative. This shortcoming has opened floodgates for instances of fraudulent land registry.
Further with regard to establishing ownership though revenue documents which generally is the practice in India, the Supreme Court has categorically held in Bhimabai Mahadeo Kambekar (Dead) … vs. Arthur Import & Export Co. that “mutation of a land in the revenue records does not create or extinguish the title over such land nor it has any presumptive value on the title. It only enables the person in whose favour mutation is ordered to pay the land revenue in question”. Absence of definitive proof of ownership makes the land registry more vulnerable and prone to fraud. Having discussed the importance of title in land registry, let us now understand the action plan of the Indian government to finally achieve conclusive titling and suppress the rampant fraud in the land registry.
Conclusive titling: future of indian land registry
The Indian system of land registry is different in various parts of India and suffers from a series of inherent defects. The fraudsters have been quick enough to identify these flaws and loopholes in the system and act upon it. The major frauds include title deception, hurried sales, assured returns, delay in possession, fake promises, forced cancellations, selling without authorization and selling the same unit to multiple buyers. The crucial challenge the government now faces is to device ways to prevent this rampant fraud in the land registry. Realizing the danger the fraudsters pose to the Indian real estate market, the Indian government has prepared an action plan to put an end to these frauds.
The Government of India has decided to implement the Centrally-Sponsored scheme in the vector of the National Land Records Modernization Programme (NLRMP) by merging two existing Centrally-Sponsored Schemes of computerization of Land Records (CLR) and Strengthening of Revenue Administration and Updating of Land Records (SRA ULR) in the Department of Land Resources (DoLR), Ministry of Rural Development.
The National Land Record Modernization Programme is based on the following four principles:
- A single window principle, to maintain and handle all the land records.
- The mirror principle, indicating that the cadastral records are a mirror image of the ground reality.
- The curtain principle indicating the record of rights evidencing the true ownership status.
- Title insurance, guaranteeing the title and indemnifying the holder from the loss arising out of any defects.
This comprehensive initiative would encompass modernization of management, computerization of land records including all mutation records, minimization of land disputes, digitization of maps, integration of spatial and textual data, development of Geospatial Information System, undertaking the necessary survey/ re-survey, updating the survey and records of settlement, increased transparency in the maintenance of land records system and eventually moving towards handing over an ownership guarantee certificate, being the conclusive proof of title for all immovable properties in India.
As per the recent Digital India Land Records Modernization Programme (DILRMP), 90.05% of the computerization of land records is completed while 2.00% is ongoing and 7.95% is not completed. Further as per DILRMP, 67.35% of the map digitization is completed, 57.21% of the survey/resurvey is completed, 91.78% of computerisation of registration is complete and 56.19% of the work for setting up of modern record room is completed.
Thus, even though a gradual development in the land records modernization is taking place the action plan prepared by the government might not be full proof and additional preventive steps need to be taken.
Prevention of fraud in land registry
The current real estate market, despite the government’s various initiatives, is suffering from repeated instances of fraud in land registry. Thus, in addition to the already undertaken steps by the government, there is a need to devise a full proof master plan to completely eliminate fraud from the land registry. Following are some recommendations which can be incorporated in the government’s action plan to combat the ever rising real estate frauds and scams.
- Video verification and recording of the property registration
Video verification and recording of property registration can go a long way in keeping the fraudsters away from indulging in benami and fraudulent transactions. The state government of Andhra Pradesh has set an example in this regard, by launching its pilot project for video recording of property registration process in a move to putting an end to the benami and fraudulent transactions. This initiative would be a first-of-its-kind project in the entire country and would serve as an additional layer of evidence. If successful this initiative can be implemented on a national footing through India.
- Uniform procedure to be followed if loss of original documents is pleaded
All the land registries throughout India, must follow a uniform protocol in case of loss of original documents which may be as under:
- Lodge a police complaint
- Obtain a non-traceable certificate issued by police
- Publication of newspaper advertisement
- Obtain an advocate’s letter that no objections have been received in reply to the newspaper advertisement.
- Obtain an Affidavit or undertaking from the present owners that the originals are lost and once found will be handed over to the intending purchasers.
- If a person proposes to sell a property on basis of a power of attorney issued to him, it is necessary that the same is verified by the registry before registration of the transaction takes place.
- Property Alerts
The Land Registries throughout India must launch a 24 hours monitoring and phone service known as Property Alerts to notify the owner of the property by message and email of any registrations concerning the property. To take it a step further along with the notification, an encrypted OTP can be sent to the registered email of the owner which must be a prerequisite to conclude the registration process. These steps acts as an additional safeguard especially when the owner is not executing the transaction himself and an alleged power of attorney holder is the executor of the transaction. If any suspicious activity is noticed immediate reporting must be initiated.
- Updating the Land Registry
The Land registry can be kept updated with any changes to be made in the addresses for service to be included on the registered title. This provides a safety cover to vulnerable properties and ensures that all property intimation reaches to the right person.
- Verification of death certificates from online municipal portals
There have been instances where fake death certificates have been relied on for registration of properties. Thus, to eliminate this risk a separate department of the registry must be specially dedicated to conduct verifications of documents relied on by the parties, including verification of the death certificates, probates, power of attorney etc.
- Conducting live thumb and retina verification with the details mentioned in Aadhaar
Access to the national database of Aadhaar must be provided to the registrar who can conduct immediate and live verification of the thumb prints and retina scan of the parties with the Aadhaar database, to ensure the parties are not impersonating the true owners.
Thus, incorporating the above recommendations in the National Land Records Modernization Programme would indeed give the government an upper hand in dealing with the fraudsters and to prevent the fraud in the land registry.
Three decades of rigorous and successive initiatives undertaken by the government of India have indeed improvised the land registration process throughout India, however, a complete elimination of frauds in the land registry still seems a distant goal. With an increase in digitization, comes the risk of increase in hacking activities and thus new plans need to be chalked down and implemented to ensure that the old digitization plan doesn’t collapse in the new age.
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