LAND TITLING SYSTEM DEFECTS AND REMEDIES 9/14/2018

1) OVERVIEW: This review relates to the documents relating to the property/estate issued by the different departments / authorities in Pakistan. In the present system there is lot of drawbacks which have facilitated ill-minded and criminals to prepare forged documents on one hand and on the other have opened many doors for bribery and illegal gratification at different levels. In nutshell the present system of documents is 9/14/2018

weak and corruption promoting. On the basis of false documents i. e weak and corruption promoting. On the basis of false documents i.e. Sale Deeds / General Power of Attorney etc. the land grabbers have illegally occupied the lands, depriving of the lawful owners of lawful possession by lodging / filing false claims in different courts of law in the whole of Pakistan. Such cases are still pending since decades. It is safely estimated that atleast 50% litigations in Pakistan pertain to false claims based on illegal documentation. This is an alarming situation. These litigations can be brought to an end by purification of the system and centralization of the titling of real estates making, Ownership verifiable like verisys system of NADRA. 9/14/2018

The financial institutions especially Housing Finance Institutions are facing legal complications in providing housing finance as well as in foreclosure because of the illegal documentation of properties and land title being unverifiable. It is therefore, very difficult to establish legal ownership in the absence of a regulatory body to monitor the property related transactions and certify the title. HBFC being a leading Housing Finance Institution has, (in the process of foreclosure) experienced many litigations due to disputed title documents despite having long experience and high degree of expertise in the field. There is also no any specific Law through which the title of the property 9/14/2018

can be established and as such reliance has to be made only on the available documents. There always has been great need to address this important issue but unfortunately nothing has been done so far. It has become more important and essential to aggressively address and settle the titling issue for the growth of housing finance market and development of housing sector providing maximum comforts to the banks and financial institution as to the security of loans / investments provided by them. 9/14/2018

It is important to mention here that one of the major objectives of National Housing Policy is the standardization of land titling but unfortunately no progress has been made in this direction as yet. HBFC Chairman has taken the initiative to resolve the titling issue and as first step formed an in house committee of three officers, well versed with the documentation to highlight the issues and suggest workable solutions. 9/14/2018

Military (Cantonment) Land Evacuee Land Abandoned Land 2) TYPES OF LAND: Government Land. Private Land Military (Cantonment) Land Evacuee Land Abandoned Land 3) NATURE OF OWNERSHIP. Free hold Lease hold 9/14/2018

4) FORMS OF LEGAL TRANSFER: Sale Deed Gift Deed Allotment Order Exchange Deed Will Grant Lease/Sub-Lease License/Sub-License 9/14/2018

5) DEPARTMENTS / AUTHORITIES MAINTAINING RECORD OF RIGHTS: Development Authorities Revenue Department through Tehsildar / Mukhtiarkar Office. Cooperative Societies Military Estate Office Cantonment Boards Housing & Physical Planning Departments, (Punjab & NWFP) Evacuee Properties Trust Board Estate Office of Federal Govt. (Abandoned Properties) 9/14/2018

6) WEAKNESS IN THE PRESENT SYSTEM: In the present system different authorities are issuing initial title deeds and maintaining the record of rights. Some authorities execute registered document whereas some do not. The unregistered documents are Allotment / Transfer Order issued by some Development Authorities and Cooperative Societies. Similarly Settlement Commissioner issues, unregistered transfer deed. All these unregistered documents can be rebutted through evidence in the court of law. So these documents stand nowhere to establish the title, as has 9/14/2018

been held by Superior Courts in various judgments been held by Superior Courts in various judgments. Even then these documents are continuously used in Pakistan. This defective system encourages land grabbers and illegal occupants to play with and have caused frivolous litigation throughout Pakistan based on false and forged documents. Resultantly thousands of such cases are pending in the courts of law in all the provinces. Even the registered documents are questionable as the Registrar is neither considered a member of judiciary nor Registrar of Titles. The superior judiciary in Pakistan is declining to accept his office as court of law and there is no law in Pakistan that governs the title. In the current situation a registered Sale Deed / Lease Deed, may not be a valid/Legal document of title. The owner needs to take a number of initiatives to assert his ownership. 9/14/2018

7) DIFFICULTIES FACED BY PUBLIC: In the present system a minimum period of 3 to 4 months is needed to acquire a registered document due to involvement of two departments i.e. Issuing Department and Registrar Office. Besides, substantial amount is spent on registration fee, stamp duty and municipal Taxes. The rates on these accounts vary from province to province. The minimum 9/14/2018

rates of these expenses are 4% of the value of property rates of these expenses are 4% of the value of property. These expenditures are apart from other overhead expenses which a person has to bear unnecessarily. It may be pointed out that in National Housing Policy 2001 the registration expenditure has been proposed to bare minimum. 9/14/2018

(i) REVENUE AUTHORITIES: The revenue authorities issue the following documents: Mutation Certificate Aks e Shajra Fard Jama Bandi The relevant person has to run from post to pillar and pillar to post for securing these documents and that too at a high cost for each document. All these documents should be free of cost and a time for their issuance should be prescribed and strictly adhered to. 9/14/2018

Possession Certificate (ii) DEVELOPMENT AUTHORITY, CANTONMENT BOARDS AND MILITARY ESTATE OFFICE: These authorities issue the following title documents: Allotment Orders Lease Deed/Sale Deed Site Plan Possession Certificate 9/14/2018

8) RECOMMENDATIONS: After loaf deliberations the committee has the following recommendations to resolve the land titling issue. The recommendations are based on the analogy that system of Land Titling should be distinct from registration of transfer deeds. 1) The conventional title documents i.e. Sale Deed, Lease Deed, Gift Deed, Transfer Deed, Exchange Deed etc. should be treated as basis of title instead of title itself. 9/14/2018

2) There should be a legal authority at federal level which should be authorized to issue a certificate of title after examining / verifying of registered documents. This certificate should be treated as “TITLE” and be accepted by all Institutions / Departments. 3) This authority be established through legislation and its Head may be designated as Registrar of Titles. 9/14/2018

4) The scope of National Housing Authority can be extended to the Registrar of titles through a notification, to be issued by the Federal Government, authorizing the authority to maintain data relating to land title and issue certificate of title. This may be an alternative solution. 5) The Registrar of Titles should be a judicial officer and the certificate of title issued by Registrar should be accepted as valid legal document of title. 9/14/2018

6) The Government of Pakistan should take the responsibility of Certificate of Title issued by the authority. 7) A system should be evolved to the effect, that without the certificate of title no building plan should be approved and no building erected, nor the civic agencies should allow Water, Gas and Electricity connections to an illegally constructed building. 8) In case of subsequent transaction, the existing owner (transferor) will surrender Certificate of Title, in original, issued to him where after a fresh title certificate will be issued to the new owner (transferee). 9/14/2018

9) The authority should provide the Internet facility like CBR to verify the authenticity of certificate of TITLE. 10) All registration officers of the country should intimate the authority about the transaction of property executed in their respective offices within seven days of the date of registration. 11) The land title will be verifiable from the single authority issuing certificate of title on internet or otherwise. 9/14/2018

The above study is preliminary and lot of work is needed to be done The above study is preliminary and lot of work is needed to be done. We will recommend that a high level Committee may be formed at Federal Government level to resolve the titling issue and the problems being faced by public. HBFC can play a major role in this Committee. If Government resolves this issue we believe that 50% civil cases will be eliminated/disposed off and there will be no unnecessary burden on judiciary in future. Submitted to the Managing Director. 9/14/2018

(Muhammad Akram Tariq) (Syed Hassan Munawar) Manager Legal/IR, Head Office, Karachi (Zafarullah Khan) Chief Manager (Law) Z.O. Islamabad. (Muhammad Akram Tariq) General Manager, HPZ, Karachi. 9/14/2018