Aadhaar in real estate: a case in point
From linking property ownership to serving as a replacement to witnesses for property registration, the advent of Aadhaar Card in the real estate sector will have far-reaching ramifications.
It is no secret that the real estate sector is prone to funding from unorganised and unknown sources. Black money was known to comprise for funding almost 60% of the immovable asset trade in India. Investigations revealed that the ignoble activity was not limited to any particular segment; residential, commercial and luxury, all tiers of real estate saw a rampant tirade of shady inflow of funds.
As per recent media reports, properties over the bracket of Rs 3 crore were the usual suspects as far as black money trade was concerned. The investigations which led to these revelations shone the light on the fact that not only realty groups but independent investors and even some trust fund owners were in on the black money bonanza!
Many problems, one solution
In one of its many efforts to curb the anonymity behind land deals, the Government has involved the panacea called Aadhaar card in the real estate mix as well. Mandating Aadhaar in real estate transactions is expected to bring legality of identities behind the change of hands in the real estate sector, and funding as well. The government has been struggling to find ways to bring transparency in transactions and end fraudulent practices such as multiple registrations of a single property. Involving Aadhaar, government authorities can approach the 'legal owners' to confirm the transaction. However, if the legal owner denies owning the property or able to show the source of income to buy the property, it can then be treated as ‘benami property’ and, the government can take appropriate actions.
Given the Government’s faith in the infallibility of the Aadhaar plan, they have sought to make the real estate transaction as over-the-counter as possible.
Maharashtra leading the way in bringing transparency
The Maharashtra Government has allowed residential buyers of not having to strictly follow the mandate of presenting a witness when registering a property. To do away with this archaic method of calling a person to identify buyer or seller, the Registration Act was amended to include photographic identity proof in real-estate registration.
The current Registration Act, 1908, only mandates adding photographs and fingerprints for registration of documents relating to immovable properties.
Union Housing Minister Hardeep Puri seemed to back the idea of linking Aadhaar card with property ownership and purchases with full sanguinity. He substantiates that in the wake of everything from bank accounts to phone numbers being linked with Aadhaar it was inevitable that Aadhaar would be required to authenticate real estate purchases.
The move of not having to produce a witness for registering a real estate is a bigger convenience for most homebuyers, than it sounds. The target is to not only increase the legality but also make the transactions simpler for the law-abiding citizens in the country. Individuals who hold the unique personal identification number have thus gained an extra incentive to invest in real estate pronto!
- By, Girish Bindal, Head of Content at PropTiger.com
Tags : EXPERT ZONE