Be it individuals or businesses, acquiring real estate is capital intensive and fraught with complex legal and compliance challenges. Oversights in title verification, land use permissions, and contract structuring can lead to eviction, closure, or financial losses. Vendors/brokers may mislead buyers/lessees, rushing transactions without full legal scrutiny.

Litigation arising from real estate disputes can be costly, prolonged, and damaging to business operations. Despite regulatory efforts, property transactions remain cumbersome due to fragmented record-keeping. This writeup highlights existing challenges and proposes solutions through digital integration.

Challenges in Property Acquisition

The due diligence for acquisition of real estate often is lengthy and costly process involving multiple steps viz.:

1. Verification and confirmation of source of title to property, ideally from the origin till the present. The original acquisition of title could be inter alia by way of government grant or state/court auction. Transfer of ownership thereafter may be through sale, gift, partition, etc. For confirming the flow of title, the original title deeds, the corresponding mutations in revenue records need examination.
2. Examination of survey records to ascertain the history of change in property numbers, subdivisions, identity, measurement, and boundaries of the property.
3. Inspection of records at jurisdictional Sub Registrar Office ("SRO") to see if the property is subject to registered encumbrance. In case the property is owned by an incorporated company, a search of records maintained by the Registrar of Companies is required additionally.
4. Ascertaining the suitability of the property for the intended purpose. In most states, if agricultural land or land assessed to land revenue is proposed to be used for a non-agricultural purpose, the same needs to be first converted by the competent authority to the specified non-agricultural purpose. In case of areas forming part of the applicable Master Plan issued under the concerned State's Town Planning legislation, such land conversion/proposed usage must conform to the usage specified in the Master Plan.
5. Examination of land revenue records like Record of Rights ("RoR")/Property cards/revenue/property tax receipt to check that the property stands in the name of the proposed vendor and that dues towards land revenue/property tax are not outstanding.
6. Examination of statutory dues/tax and other liabilities of the vendor to eliminate the possibility of the property being charged on account of outstanding tax liabilities.
7. A thorough search of court records is essential to ascertain if a given property is lis pendens.
    

Efforts by Governments

The Central Government launched the National Land Records Modernization Programme ("NLRMP") in 2008 to modernize the management of land records, minimize the scope of land/property disputes, enhance transparency in the land records maintenance system, and facilitate moving towards guaranteed conclusive titles to immovable property.

It was revamped in 2016 as the Digital India Land Records Modernization Programme (DILRMP). The programme seeks to develop a modern comprehensive and transparent land record management system with the aim to develop an integrated land information management system to:

1. Improve real-time information on land.
2. Optimize use of land resources.
3. Benefit both landowners and prospectors.
4. Assist in policy and planning.
5. Reduce land disputes.
6. Check fraudulent transactions.
7. Obviate the need for physical visits to Revenue/Registration offices.
8. Enable sharing of information with various organisations/agencies.

The Programme emphasizes of uniformity, interoperability and compatibility of sharing land records among different stakeholders. The concerned State Government / Union Territory administrations are required to implement the Programme. According to Central Government, by end of 2024 98.50% digitization of the existing land records was completed.[2]

The roadblocks
The current digitization of land records under DILRMP is based on existing manual land records which are often not updated, incomplete or even damaged. For instance, a sale transaction by way of registered Deed may not be entered in Record of Rights owing to failure of the concerned SRO, or the parties, to report the transaction. Similarly, devolution of interest on demise of an individual whether testate or intestate may not be reported.

Often the conditions imposed by initial land grants by State Authorities such as the land being granted to depressed class or any non-alienation period applying to such grant, do not find mention in RORs. There could be instances where the records are damaged or destroyed. It is also cumbersome to find out if a land assessed to land revenue has been converted to specified non-agricultural purpose and designated usage, if any, in the Master Plan framed for the given area under concerned State's Town & Country Planning legislation.

The details of conversion of land to non-agricultural purpose are often not shown in RORs. Also, RoRs across different States exist in different formats. Absence of uniformity makes it difficult to comprehend the significance or purport of entries in Record of Rights.

These problems need to be addressed by updating and integrating the records of initial Government grants or revenue or court auction with the RORs, survey records, data available in SROs, ROC, courts, local and town planning authorities and maintaining a single national digital registry where all states follow a standardized data.

The way ahead
With the advancement in technology, it is time for the concerned state agencies including the Ministry of Housing and Urban Affairs, the Department of Land Resources, Government of India, RoC, State Revenue Departments, SROs, Town Planning Authorities, Courts, registrar of births and deaths to urgently prioritize and expedite the digital updating and integration of real estate records and set up a unified, interoperable digital framework, addressing roadblocks in DILRMP.

Leveraging technologies like blockchain and AI, these bodies can ensure real-time updates, standardize RoR, and integrate data on encumbrances and litigation. This will reduce land disputes, prevent fraudulent transactions, and create a transparent, accessible real estate ecosystem that benefits landowners and investors.

End Notes:

1. https://dolr.gov.in/programmes-schemes/dilrmp-2/
2. https://sansad.in/getFile/annex/266/AU3023_MepFYO.pdf?source=pqars and https://pib.gov.in/PressReleaseIframePage.aspx?PRID=2088125

Written By: Smita Singh, Advocate