Bill Lends A Hand To Buyers On Shaky Land


By akansha, Section Noida Real Estate Property
Posted on Thu May 21, 2009 at 11:44:14 PM EST

The Delhi government is ready with a new property Bill, which through a computerised single-window operation envisages a method of foolproof land registration to minimise any chance of fraud during transaction.

This new system will now provide "titles" to a property owner, replacing the present practice of registration of sales deeds. While the present system is not inaccurate, the new method has a more consolidated approach to ensure "undisputed" ownership - doing away with the rampant practice of acquiring property by registering fake sales deeds.

How will disputes be solved?
A separate tribunal will be established to look at any property dispute to determine titleholders or actual owners. All disputes regarding ownership, pending before any court in Delhi, will be registered with the Authority. The Bill further states: "No civil court will have the jurisdiction to entertain any suit or proceeding in respect of any matter which the Tribunal is empowered to determine".

Penalty
Those submitting false documents will be penalised with imprisonment for up to seven years or fined Rs 2 lakh or both.

In the new system, the government will become guarantor for a property when it provides it a "title". In case there is still fraud, the government is liable to pay compensation to any party who has been cheated in the transaction.

The new Bill the Delhi Survey, Registration and Recordal of Title of Immovable Properties in Urban Areas was conceived two years ago, and is now ready. It will be tabled in the Cabinet after a public hearing.

Source: The Indian Express Bill lends a hand to buyers on shaky land

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The Bill proposes a single authority be formed, called the Delhi Survey, Registration and Recordal of Title of Immovable Properties in Urban Areas Authority. This will be in charge of all registrations and property transactions. At present, with multiple agencies handling a transaction, there can always be scope for deceit in the very physical handling of files.

The Authority will maintain records of all transactions. It will be an autonomous statutory body, headed by a chairperson, having "not less than three members".

Chief Secretary Rakesh Mehta said the government wants to replace the practice of deed registration with title registration. He also said the Union Urban Development Ministry has asked the state to prepare a similar blueprint for the rest of the country.

The Bill mentions: "Lack of conclusiveness of land titles has become a growth constraint for real estate development in India." It adds: "Considering the potential of the real estate development in India and especially in Delhi, it is strongly felt that an electronic system of dealing with title records of immovable properties should be introduced."

The Bill is based on a USAID project carried out on behalf of the state government. The USAID report had stated that due to the absence of a title registration system, title (ownership), possessor rights (such as lease) and other property rights are not readily verifiable.

Government officials said this system is followed in developed countries. It will facilitate property transactions, encourage investment, and reduce disputes and uncertainty over ownership.

The USAID report said buyers and mortgagers always face a risk if there is difficulty in proving the ownership of a property. There is also a risk to banks and housing finance companies they may be unable to foreclose a mortgage. Moreover, many households are unable to prove legitimate ownership and are often not able to access mortgage finance. This, in turn, deprives banks and finance companies of a significant part of the potential market.

The absence of a verifiable titling and record system has led to excessive litigation in the city, said a senior government official. He said: "The number of property disputes, particularly over ownership of a plot, is one of the highest in Delhi."

Under the Bill, all properties in Delhi will be given a unique identification number. The registration of the property and sales transactions will be compulsory and those who have the power of attorney will need to undergo biometric identification a process that relies on a person's physical characteristic to authenticate his identity. Power-of-attorney holders will also have to register themselves with the Authority.

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