The government in September unveiled a draft new law on the much-awaited real estate regulator to oversee builders for protecting homebuyers. This is a step well taken. However, there is still a lengthy chain of procedures the buyer has to go through to complete the registration process of the land and the property once it has been bought from the builder.
A title deed is a legal document used to prove ownership of a piece of property. In many regions of the world, a title deed confers certain rights and privileges on the person who holds it, and such deeds are necessary in situations where people want to transfer ownership of their property. There is a lengthy list of documents which are prerequisites for obtaining the title deed of a property in India—site allotment notice, possession certificate, sale deed, encumbrance certificate, transfer certificate, tax-paid receipts, intermediate sale deeds and registration certificate, to name a few.
The actual procedure for obtaining the title deed for a property is as follows. First, an application is submitted to the relevant urban development authority for a title deed, to be done immediately following the obtaining of sale deed. An encumbrance certificate (EC) has to be obtained: Before buying any land or house, it is important to confirm that the land does not have any legal dues. This certificate is available from the sub-registrar office, where the deed has been registered. But the longer the time period since the sale deed has been issued, the greater the likelihood of legal dues, and the longer it takes to get an EC. There’s also a penalty which needs to be paid if the title deed is not obtained immediately after the sale deed. If there is a time gap between obtaining the certificate and the next steps, an updated one has to be produced.
Once this is obtained, a copy of the lease-cum-sale document, allotted by the urban development authority to the original allottee, needs to be obtained. A transfer certificate then needs to be obtained. This is followed by a site inspection which confirms that the property for which the title deed is being sought is, in fact, real. A site inspection also confirms that the buyer has absolute possession and that the measurements are as per the sale deed. Following this, a title deed is issued in the property owner’s name. The registration of this property is done at the sub-registrar’s office, wherein a stamp duty is paid.
The interesting aspect of the process described above is that neither the procedure nor the documents are the same for every case. It varies depending on the nature of the transaction. In theory, the time taken for the process is only 45 days. But this rarely happens in practice. In practice, the time taken for obtaining a title deed is roughly six months.
In no other country is the obtaining of a title deed so complicated and time-consuming as it is in India. In the US, for example, this procedure can be completed in as little as 10 days.
Since the procedures are extremely lengthy, households just bypass the procedures and buy illegally. So solving this issue will benefit all—the government, the developers and the purchasers— and will improve the property market. Committees could be created in every town, under the supervision of the ministry of urban development, to record within three months all properties for which a title deed has not been issued.
There are other solutions: Karnataka has been contemplating the issue of a property card to get around the unreliable, often misused, records of rights for property owners. Hence, the proposed real estate regulator should oversee these aspects of the post-building process as well.
Kala Seetharam Sridhar is senior research fellow, Public Affairs Centre, Bangalore, and Asha Ravi is a consultant engineer based in Mysore. The views expressed here are personal. Comments are welcome at firstname.lastname@example.org