Property Registration in India: A Critical Look at the Registration Bill 2025

BK Agarwal
Nov 10
9 min read

India follows deed registration system for recording property transactions, based on a century old Registartion Act 1908 enacted by the British colonial rulers. It is universally accepted that this law can no longer cater to the requirements of modern India which has grown into the fourth largest economy in the world. Government of India has initiated enactment of a new registartion law. This article critically examines whether the draft of proposed law will actually improve land administration sytem in the country. This is the reproduction of my article published on Land Portal Foundation, as part of India Land & Development Conference (ILDC) blog series.

The Department of Land Resources, Government of India, has initiated a long-overdue and welcome move to enact a new law on property Registration, replacing the century-old Registration Act 1908. A draft of the new Registration Bill 2025 has been circulated for public opinion.

The present law enacted by the British colonial rulers has been the cornerstone of land administration in India. With barely any substantial change in the last more than a hundred years, this law has not kept pace with the changing socio-economic realities of a new Independent India. By proposing the new Bill, the Department of Land Resources has signalled its intent to reform the country’s property registration system. However, it remains to be seen whether the proposed legislation will effectively address the existing deficiencies. In this article, I intend to do that only.

Background

The registration of deeds was introduced in India by the British in 1793 to provide security of title to the person acquiring property, prevent fraud in property transactions, and preserve authentic copies of deeds to avoid future litigation. Initially, registration of deeds was optional, with priority given to a registered deed in case of a dispute. Later, the registration of certain property transactions became compulsory through the Indian Registration Act, 1866. The present Registration Act was enacted in 1908, and it has not undergone any substantial changes since then.

Alongside deed registration, a cadastral record was also established by the British in 1822 to collect land revenue on agricultural land. This record, called ‘record of rights’, is maintained by the state governments under the state-specific laws. It contains ownership and other rights recorded with reference to cadastral maps and, therefore, gives a more comprehensive picture of people’s rights over property.

Previous Efforts to Reform the Property Registration Law

A bold attempt was made by the Department of Land Resources in 2008, by adopting the policy of converting the present deed registration system to the title registration system. A draft Title Registration Act was sent to the states advising them to enact laws on that pattern. However, no state has gone for a title registration system so far.

While the attempt to introduce title registration may not have succeeded, the existing deed registration system can still be significantly strengthened by amending the Registration Act to incorporate select features of title registration.

Purpose of a Property Registration System

The basic purpose of a property registration system is to maintain a reliable public record of rights over property. To achieve this purpose, it must have the following characteristics:

§ All transactions affecting the rights of people over property must be registered without any exception or exemption.

§ The record should be easily searchable to know the rights of people over any property.

§ Record should be easily accessible to the public.

§ Simple procedures for registration of transactions and for accessibility to the previous records.

§ Legal rules to establish the credibility of registered transactions in comparison to unregistered ones.

Let us now assess the extent to which the new Registration Bill meets these requirements.

Registration of All Transactions

Without the registration of all transactions in the property, the registration records cannot be relied upon to know the current status of rights. The new Bill is no improvement over the existing law in this regard, as it has retained almost all the exemptions from registration provided in the Registration Act 1908.

Apart from exemptions given in the Registration Act, there is another reason for many transactions not appearing on the record. The Registration Act provides for registration of only those transactions which are made through written instruments. As per section 9 of the Transfer of Property Act 1882, ‘a transfer of property may be made without writing in every case in which writing is not expressly required by law’. The Transfer of Property Act requires only the sale, lease of a period exceeding one year, exchange, mortgage, gifts of immovable property to be made by written and registered instruments, allowing all other transactions by oral or unregistered agreements. Some such transactions are:

§ Partition of joint family property

§ Relinquishment of a right by a joint family member

§ Leases of agricultural property

§ Gift to a deity

§ Gift by a Muslim

§ Mortgage by deposit of title deeds

§ Surrender of a lease

§ Release by a mother of her interest in joint family property

§ Grant of property for life in discharge of a claim for maintenance

§ Contract to settle property in consideration of marriage

This is a major weakness of the property registration system in India, which remains unaddressed in the new Bill. There is an utmost need to mandate that all property-related transactions be done only through written and registered instruments.

Registration of Contract for Sale

Before a sale deed is registered, many times, parties often enter into a contract for sale. In some cases, possession is also transferred to the buyer at this stage. If possession is transferred at the time of the contract for sale, the rights of the buyer are protected under section 53A of the Transfer of Property Act. The Registration of this kind of contract is compulsory under the Registration Act 1908. All other contracts for sale are exempt from registration. If a property owner, in breach of a contract for sale, tries to sell the property to another buyer, the latter has no way to know about the earlier contract for sale. This situation occurs frequently in India and leads to avoidable litigation in courts.

Many states, like Andhra Pradesh (1999), Gujarat (1982), Kerala (2013), Madhya Pradesh (2010), Orissa (2002), Rajasthan (1989), Tamil Nadu (2012), and Uttar Pradesh (1977), have made registration of all kinds of contracts for sale compulsory by state amendments in the Registration Act 1908. However, the Registration Bill 2025 has made no change in the present position in this regard. It is imperative that the scope of section 12 (2) of the Registration Bill 2025 is widened to make registration of all contracts for sale compulsory.

Registration Mortgage by Deposit of Title Deeds

The provision of registration of mortgage by deposit of title deeds in the new Bill is a good step. However, two provisions for this purpose, i.e. 'filing a copy' under section 14 (3) and 'compulsory registration' under section 12 (h), will cause ambiguity and operational challenges. Ideally, mortgage by deposit of title deeds, as a separate class of mortgage, should be removed altogether from the Transfer of Property Act 1882 and the Registration Bill 2025. The simple mortgage as provided in section 58 (b) of the Transfer of Property Act is sufficient to take care of all credit needs in the country because the legal effect of both these mortgages is the same. The mortgage by deposit of title deeds is preferred to save on stamp duty. Instead of retaining this mortgage, the simple mortgage should be exempt from the stamp duty.

Registration of Pending Litigation

As per the law, if a property under litigation is sold, the rights of the buyer are subject to the outcome of the litigation. However, a buyer has no way to know about a pending litigation related to a property. Recognising this problem, the Supreme Court in T. G. Ashok Kumar vs. Govindammal & Others case has suggested an amendment in section 52 of the Transfer of Property Act on the pattern of an amendment by the Government of Maharashtra. In 1998, the Law Commission, in its 157th report, also recommended similar amendments in the law.

Strangely, the recommendations of the Supreme Court and of the Law Commission have been ignored while drafting the Registration Bill 2025. The provision for compulsory registration of pending litigation will be a big improvement in the registration law and must be incorporated in the new Bill.

Registration of Grants by the Government

Grant of an immovable property by the government is exempted from registration under section 17 (2) (vii) of the Registration Act 1908. This exemption prevents the creation of a legal record of such grants on which the lives of millions of poor, landless people depend in the country. In countless cases across the country, land grants to poor people are issued on paper without the grantee ever getting possession or even knowing about it. Such irregularities can be curbed by mandating compulsory registration of government grants, which will ensure verification of the identity of the grantee, acceptance by him and confirmation of transfer of possession to him.

Registration of Wills

In the Registration Act 1908, registration of a will is optional. The same position is proposed to be retained in the new Bill also. The appearance of multiple unregistered wills is a common cause of protracted litigation among heirs. The Standing Committee of Parliament on Rural Development, in its report on the Registration (Amendment) Bill 2013, has recommended compulsory registration of wills. Despite this recommendation, the new Bill maintains the status quo in this matter.

Verification of Ownership of Seller

Currently, the Registrar has no mandate to verify the seller's competence, and this responsibility falls entirely on the buyer. A simple provision in the new Bill for compulsory attachment of a copy of the record of rights will ensure the prima facie verification of ownership of the seller, reducing future disputes to a great extent. A deed would be accepted for registration only when the name of the seller appears in the record of rights.

Description of Property in Deeds

Linking of registration records with the record of rights is the most needed reform in our deed registration system. The lack of a cadastral reference in the deeds makes it very difficult to know the correct title of a property by searching the records of the registry alone. Many European countries, including France and the Netherlands, have greatly improved their deed registration systems by linking registration to the cadastral maps. The easiest method to link registration with the cadastral maps is the compulsory attachment of a copy of the record of rights with the sale deed. Attachment of a copy of the record of rights will serve the twin purpose of verifying the ownership of the seller and linking the transaction to the cadastral map. However, the provisions in the new Bill are almost the same as the existing law.

New Maps before Transferring Part of the Property

As per present practice, if part of the property is transferred, the parts are described in the text of the deed without attaching new maps. Actual division on the map is done at the time of mutation in the record of rights. This process delays the mutation and also gives rise to boundary disputes. A provision in the new Registration Bill mandating the preparation of new maps before registration will foreclose any possibility of such disputes in future.

Automatic Mutations

After registration of the deed of a property transaction, the person acquiring rights has to apply to another authority for mutation in the record of rights (cadastral records). During the mutation proceedings, objections are invited from all the concerned parties. New maps are made in case of the transfer of part of the property. Due to this long and complex process, records remain outdated for a long time. By making some bold changes in the law, the whole process of mutation can be made quick, simple and more transparent. If, as suggested in previous paragraphs, a deed is registered strictly according to the record of rights and new maps are prepared before registration, the mutation can be done by the registrar only. There is no requirement for separate proceedings before another authority, as is the practice now. The mutation can even be done automatically by the computer system. The new Bill must take this bold step to break away from the century-old practice to modernise our land administration.

Conclusion

While initiating the enactment of a new law on registration after more than a century is commendable, the new Bill in the present form is not likely to bring any fundamental change in land administration. It largely retains the structure and provisions of the Registration Act, 1908, with very few changes. The completion of the digitisation of the record of rights is a great achievement. Now there is an opportunity to modernise our land administration by utilising the full potential of digitisation. However, it can't be done without some structural changes in the land-related laws. There is a need to reconsider the present draft of the Registration Bill 2025 in consultation with all the stakeholders.