With dematerialised documents and digitally verifiable KYC (Know-your-Customer) identification, the transfer of financial assets in India is now a relatively smooth process. But the transfer of immovable property remains a paper-laden process requiring long hours spent at the sub-registrar office. The draft Registration Bill 2025 floated by the Ministry of Rural Development, Government of India aims to modernise the transfer process for immovable property, by updating provisions in the Registration Act of 1908.

While the attempt to revamp an archaic law is welcome, the Bill doesn’t go far enough in cutting red tape. As property registrations are a key revenue source for State governments, it is also moot if the Bill will have an easy passage into law. The Bill proposes three sets of changes to the property transfer process. One, it enables document submission through electronic means — in addition to physical means — to the sub-registrar/registrar. Identities of parties executing the transfer will be verified electronically through Aadhaar or other ‘officially valid’ documents. It is good that the Bill has specifically stated that registration cannot be refused on the grounds of lacking an Aadhaar. While electronic document submission is allowed, actual registration will still require parties to appear either physically or electronically before the registering officer and affix signatures. Therefore, the prevalence of touts and agents to ‘expedite’ registration and rent-seeking on this count, are likely to continue. Electronic storage could expose title deeds and other critical data of citizens to the threat of cyber-fraud and privacy violations. This requires explicit safeguards before this Bill is passed into law.

Two, the Bill lays down a hierarchy for State machinery to process property transfers. In the event of a sub-registrar refusing registration, citizens have recourse to the registrar. But both sub-registrars and registrars will still have wide discretionary powers to turn down registrations, with no dispute resolution mechanism except through the Courts. T

Finally, the Bill substantially enlarges the scope of the Registration Act itself by sweeping many new transactions under its ambit. Citizens will be required to formally register gifts of property, lease agreements exceeding one year, agreements for sale, contracts for property development, promoters’ agreements and mortgage transactions. This could impose a large compliance as well as monetary burden on citizens, given that States will impose stamp duty and fees on all such transactions. While it may be legally sound to require registration of mortgages or gifts to establish title, the rationale for registering biparty contracts such as leases, agreements for sale or property development is unclear. Given these loose ends, the Centre may need to extend the consultation process which ends on June 25 and seek States’ feedback before tabling this Bill.    

Published on June 18, 2025