NEW DELHI: The Supreme Court has raised concerns about systemic weaknesses in colonial-era property laws, advocating for nationwide reform. The court has instructed the Law Commission to create a comprehensive report examining the use of Blockchain technology to modernize property registration processes.
Blockchain technology offers a secure, transparent, and immutable digital ledger for property transactions, significantly reducing fraud and improving verification processes for ownership and transactions through smart contracts.
This directive followed a landmark ruling from a bench consisting of Justices Pamidighantam Sri Narasimha and Joymalya Bagchi, which invalidated Bihar’s 2019 amendment that allowed registration authorities to deny registration of sale or gift deeds without proof of mutation or ‘jamabandi’ allotment.
“The constitutional right to own property includes the freedom to acquire, possess, and dispose of it at will. Efficient and transparent property transactions reflect a nation’s institutional maturity and the trust its citizens place in the integrity of its legal system,” Justice Narasimha stated in a 32-page verdict.
The verdict highlighted the existing “long-standing disconnect between registration and ownership” and emphasized the need for a system where registration acts as conclusive proof of ownership, guaranteed by the State.
The court pointed out that the Registration Act mandates the registration of documents rather than titles, creating confusion for prospective buyers who must navigate a complicated title search due to a presumptive titling system that contributes to 66 percent of civil disputes.
The ruling noted that existing laws such as the Transfer of Property Act, the Stamp Act, and the Registration Act are outdated and need modernization toward a “conclusive titling system” to simplify transactions and reduce litigation.
In its recommendations, the court suggested that the Central Government investigate the potential of Blockchain to establish a transparent, tamper-proof system for land records. The immutability and traceability of Blockchain could effectively prevent fraudulent registrations and bolster public confidence in property ownership.
Additionally, the ruling called for the integration of cadastral maps, survey data, and revenue records into a unified digital framework, making it publicly accessible and thereby transforming the property registration landscape.
The court also addressed the problematic Bihar rules empowering registering authorities to deny deed registrations without the required proof, which it declared arbitrary, unreasonable, and impractical given the incomplete state of the land survey and mutation processes in Bihar, where 80 percent of ‘jamabandis’ still bear the names of deceased ancestors.
The decision came in response to a petition from Samiullah, represented by lawyer Athenam Velan, challenging the Patna High Court’s ruling that upheld these restrictive rules. The court reinforced the principle that mutation does not confer ownership, serving only as a fiscal entry, and emphasized that questions of title should be adjudicated by civil courts, not registration officers.
The court ultimately annulled the 2019 Bihar amendment and ordered the quashing of the notification that imposed unnecessary burdens on property registration.
In its ruling, it stated, “The requirement for presenting jamabandi or holding allotment as a precondition for registering a legally submitted document under specific rules is arbitrary and illegal.” PTI
