by Mr. Mayank Saksena, Managing Director – Land Services,
Jones Lang LaSalle India
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 & rehabilitation laws
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| Mr. Mayank Saksena |
Land Acquisition Means..!
As things stand now, land acquisition has become a means
for a multitude of middle-men 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 land owners.
Until that happens, the availability of fool-proof 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.
How To Avoid Bad Land Deals..!
One can avoid bad
land deals by:
^^ Using experienced lawyers for the transaction
^^ Doing a detailed due diligence
^^ Employing the services of a reputed real
estate consultant with in-depth market knowledge.
When it comes to land acquisition, there is no question
of a free lunch or short-cuts. 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 land owners agree
to pool their land holdings and then develop them together. Successful cases
include Amanora in Pune and Magarpatta, also in Pune, where various land owners
pooled their land and developed townships to service the growing residential
and office real estate needs of Pune's IT industry. All the original owners
have a stake in the developing company.
The Role Of The Government..!
The present laws
are such that it is next to impossible to get 100 % clean title for a land
parcel of any significant size. The problem is that the law does not have
provisions to stop a claimant from approaching the courts at any stage and at
any time.
The only secure way to get land with a 100 % secure title
in India was through the Government. However, with the issues that have been
raised as farmers went to court at Noida West and Greater Noida, even that
route has now come into question.
In order to make acquiring land India easier and more
beneficial, the Government needs to make more proactive laws for the process of
acquisition, as well as for resettlement and rehabilitation. Two of the most
critical needs of the hour are the abolishing of the Urban Land Ceiling Act
(ULC Act) across Indai, and the formulation of laws that encourage
participation of the owner in development of land.
The Government can not wash its hands off the
responsibility of providing land for development, especially on rehabilitation
and resettlement.
The Government should devise a mode to provide title
security, and laws need to be made in a manner that ensures that old laws such
as ULC do not have an overhang on the land.
If we want our country to be truly global, and to grow
more rapidly, land for development needs to be made available more easily.
Cases such as Singur, Greater Noida and Noida West must be avoided at all
costs, as they shake global confidence in investing in India.
About the author..
Mr. Mayank Saksena is Managing Director (Land
Services), Jones Lang LaSalle India
For Media Contact
Mr. Arun Chitnis
Assistant Vice President, Marketing
Jones Lang Lasalle India
Level 6, Amar Avinash Corporate Plaza
Bund Garden Road, Pune 411001.
Tel: (020) 30930441 Fax: (020) 40196101
Mob: +91 9657129999
Website: www.joneslanglasalle.co.in
Blog: www.joneslanglasalleblog.com/realestatecompass
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