Land Reforms-Land titling and its challenges

Introduction

• The Centre wants to reform the country’s land markets through a fundamental legal and procedural shift in how land titles are awarded.
• In 2020, even as laws for farm reform and labour code reform were being enacted, the government’s think tank, NITI Aayog, took steps to initiate land reforms.
• A Model Bill on Conclusive Land Titling was sent to States and Union Territories last June seeking their comments.
  • In September, after many States failed to send in their feedback, the Centre warned that their agreement would be presumed.

How does the current system work and what will change in the new system?

Presumptive land titling system

• India currently follows a system of presumptive land titling.
• This means that land records are maintained, with information on possession, which is determined through details of past transactions.
• Ownership, then, is established on the basis of current possession.
• Registration of land is actually a registration of transactions, such as sale deeds, records of inheritance, mortgage and lease.
• Holding registration papers does not actually involve the government or the legal framework guaranteeing the ownership title of the land.

Conclusive land titling system

• On the other hand, under a conclusive land titling system, land records designate actual ownership.
• The title is granted by the government, which takes the responsibility for accuracy.
• Once a title is granted, any other claimant will have to settle disputes with the government, not the title holder.
• Further, under conclusive land titling, the government may provide compensation to claimants in case of disputes, but the title holder is not in any danger of losing ownership.

Why is conclusive land titling needed?

• Lower litigation: The main advantage is that a conclusive system will drastically lower litigation related to land.
  • According to a 2007 World Bank study on ‘Land Policies for growth and poverty reduction’, land-related disputes accounted for two-thirds of all pending court cases in India.
  • A NITI Aayog study on strengthening arbitration estimated that disputes on land or real estate take an average time of 20 years in the courts to be resolved.
• Higher Investment: Once conclusive titling is in place, investors who want to purchase land for business activities will be able to do so without facing the constant risk that their ownership may be questioned and their entire investment may go to waste.
• Infrastructure Development: Land disputes and unclear titling also create hurdles for infrastructure development and housing construction, leading to costly delays and inefficiency.
• Increase in tax collections: In cities, urban local bodies depend on property taxes that can be levied properly only if there is clear ownership data available.
• Black market transactions: Ambiguity in ownership also results in a black market for land transactions, which deprives the government of taxes. A conclusive land titling system can reduce these transactions.
• Agricultural credit: Access to agricultural credit is dependent on the ability to use the land as collateral.
  • Without being able to prove their ownership of land and access formal credit from banks, small and marginal farmers are often left at the mercy of unscrupulous moneylenders, entrenching themselves in a mountain of debt.

What does the model Bill propose?

• Title Registration Officer (TRO): The Bill circulated by the NITI Aayog in 2020 calls for Land Authorities to be set up by each State government, which will appoint a Title Registration Officer (TRO) to prepare and publish a draft list of land titles based on existing records and documents.
  • This will be considered a valid notice to all potential claimants interested in the property, who will have to file their claims or objections within a set period of time.
• Land Dispute Resolution Officer (LDRO): If disputing claims are received, the TRO will verify all the relevant documents and refer the case to a Land Dispute Resolution Officer (LDRO) for resolution.
  • However, disputes which are already pending in courts cannot be resolved in this way.
• Land Authority: Having considered and resolved all the disputed claims, the Land Authority will publish a Record of Titles.
• Land Titling Appellate Tribunal: Over a three-year period, these titles and the decisions of the TRO and the LDRO can be challenged before Land Titling Appellate Tribunals, which will be set up under the law.
  • After a three-year period, entries in the Record of Titles will be considered conclusive proof of ownership. Further appeals can only be taken up in High Courts.

What are the difficulties?

• Poor updation of land records: The biggest challenge is that land records have not been updated for decades, especially in rural and semi-urban areas.
  • Land records are often in the name of the grandparents of the current owner, with no proof of inheritance.
• Need for village-level survey: Comprehensive village-level surveys with community involvement are a necessary precursor to the land titling process.
  • Relying on current records or even satellite imagery will not provide the same accuracy as actual, on-the-ground, local surveys.
  • If surveys are not conducted, the onus falls on village claimants, many of whom have no access to documentation, to proactively challenge the titling during the three-year period.