SC Opens the Blockchain Door, It’s Time to Walk Through It
Property fights drag on in India mostly because of the way we keep our records. The Supreme Court said last week that the country should adopt blockchain to fix this problem. But for the technology to work, the government must keep a few important things in mind.
The Gist
The Supreme Court of India recognises the challenges in land ownership and suggests blockchain as a potential solution.
- Land disputes often arise from multiple claims over the same property, resulting in lengthy court cases.
- The court emphasises the need for a unified record system and legal recognition of ownership through blockchain.
- Steps include cleaning existing records, consolidating them into one system, and updating laws to reflect true ownership.
Buying land in India is not easy. Even after paying money and registering the sale, sometimes it can be difficult to prove that you truly own the land.
The most common issue is two or more people claiming the same piece of land.
When this happens, the matter invariably goes to court, and it can drag on for many years. This not only causes stress and financial burden for the parties involved, but also adds to the pile of pending court cases.
The Supreme Court has now stepped in, saying this problem is serious. The judges said on Friday during a hearing that our system mostly records documents, not ownership, which leaves room for doubt.
The court went to the extent of saying that buying land should not feel like a gamble, and steps should be taken to end the dichotomy between registration and ownership under the property laws.
And then came the unexpected: the court suggested that blockchain may help because it can keep records so securely that no one can modify them later or fudge papers. The court has directed the Law Commission to study how this could be done.
In the past, we have written about how blockchain could become the peacemaker India needs for its endless land disputes.
At the same time, we have also written about how many blockchain projects have failed because the users did not approach the technology properly.
So, we take the liberty of offering a few tips to the commission on what steps it needs to take to make the most of blockchain.
Step #1: Get the Records Clean
This is the most important part. Before putting anything on the blockchain, the land records themselves must be in order.
Right now, land information is spread across many places such as the revenue office, the sub-registrar office, and the panchayat or municipal office.
There are cases where each department has a different version of the same land record, or the records do not match the land on the ground.
All of this needs to be fixed. And there are precedents to learn from.
In 2016, Georgia did something similar before moving its land records to blockchain. They first fixed their land records that included checking maps, correcting names, and digitising everything.
If these records are brought on blockchain without fixing them first, then the confusion will become eternal.
That's because the records, once part of the blockchain universe, cannot be changed without upsetting the whole system.
So this is what the Indian government should do first: get the maps checked, correct the names, and fix all measurement-related anomalies.
Step #2: Make One Common Record
Once the records are corrected, they should be placed in a single system. That means different departments will not get to store a different version of the same record.
The new system should clearly show who owns the land; when the ownership changed, if any; whether the land has a loan on it; and whether it is under litigation.
One way to know the system is working fine is to check whether everyone — the buyer, the seller, the bank, and the registrar — is seeing the same record. That would naturally clear the confusion and lead to fewer legal disputes.
We can start with a few districts first. As a matter of fact, a district in Chhattisgarh has already stored over 700,000 land records on the blockchain. Some lessons could be taken from there as well.
For global inspiration, India may also turn to Sweden, which piloted blockchain for property registrations in 2016.
The idea is to learn from these examples, plug the loopholes, and then gradually expand.
Step #3: Change the Law
For this new system to have real power, the law must say that the name in this system is the true owner. Not someone who claims to have some papers.
This legal safety net will remove doubt, and it will make buying and selling land easy.
But here is a reality check: no country has done this so far. Most of them are still stuck at Step #2. As of today, their land registry still decides who owns the land. But who says India cannot be the first to implement Step #3?
At the same time, the system should also be easy to use and it should work in various regional languages, so that people don’t need middlemen or agents to check land records.
Final Words
The Supreme Court has opened a door. Now the government just needs to walk through it with a plan.
Yes, it’s true that it was easier for Georgia to adopt blockchain because the digitisation of its land records began way back in 2004. Plus, the country is about 1/50th the size of India in land area.
That means the journey for us could be slightly longer because the process of digitisation is still not complete in our country.
But if we clean the records, put them in one place, update the law, and use simple technology, then buying land can become less cumbersome.
This is our chance to make that happen. So let's get it done.
