Property Disputes and Land Acquisition

As things stand now, land acquisition has become a means for a multitude of middlemen to make a lot of money. This is because the tough regulations and complexities related to acquiring land today provide huge arbitrage to such people. If the government starts simplifying the process, middlemen can be eliminated, reducing the cost arbitrage and passing the benefit to the actual landowners. Until that happens, the availability of foolproof deals in land will remain scarce on the ground. For the record, a good deal is one wherein one can buy, in one go, a clean title property that complies with all government plans and stipulated usages.

The core issues that surround the acquisition of land in India are more complex than those related to built-up property. Some of these are:

  • Litigations due to inheritance
  • Multiple sales which have not been properly recorded
  • Pledging of land to local money lenders
  • Fragmented holdings
  • Requirement of cash while dealing with sellers
  • Difficulty in obtaining contiguous land
  • Lands which have been granted to SC/ST by the government
  • Land ceiling laws
  • Tough resettlement and rehabilitation laws.

How to avoid bad land deals

One can avoid bad land deals by using experienced lawyers for the transaction. One has to go for a detailed due diligence. Employing the services of a reputed real estate consultant with in-depth market knowledge is also a solution which would help avoiding bad land deals. When it comes to land acquisition, there is no question of a free lunch or shortcuts. If something about a land deal seems out of whack, then it can be taken for granted that there is an issue with the land. As things stand today, fraud happens as because people buy land without complete due diligence, which leads to faulty acquisition of land with title issues.

The objective of buying land for development should be getting a clean, secure title and being able to develop on the plot without facing any future complications at the development stage, and within a stipulated time.

Developers' nightmare

In the whole morass of problems related to land acquisition, developers face the greatest challenges in obtaining a clean, bankable title to a contiguous land parcel of sufficient dimensions to develop projects. Another issue they face is the loss of control on cost during acquisition, since the cost of acquisition after completion of the entire process is often so high that any development becomes prohibitively expensive.

Often, the only way in which developers have been able to circumvent the complexities involved in the acquisition and development of land is via land pooling. This is a process wherein a number of landowners agree to pool their land holdings and then develop them together.