Analysis: Unauthorized colonies

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On 26th November 2019, the National Capital Territory of Delhi (Recognition of Property Rights of Residents in Unauthorized Colonies) Bill, 2019 was introduced in the Lok Sabha by the Union Minister for Housing and Urban Affairs, Hardeep Singh Puri, to legally entrust the ownership rights to more than 40 lakh residents of 1731 unauthorized colonies.

This would entitle them the power of ownership or transfer or mortgage on the basis of Power of Attorney, Agreement to Sale, Will, possession letter and other documents including documents evidencing payment of consideration, which earlier did not convey any title in the property as held by the Supreme Court in the case of Suraj Lamp & Industries (P.) Ltd. v. State of Haryana.

Bill defines, “Unauthorized colony” as a colony comprising of a contiguous area, where no permission has been obtained for approval of layout plan or building plans and has been identified for regularization of such colony in pursuance to the notification issued by the Delhi Development Authority(DDA).

Generally, unauthorized colonies mean any part or parts of cities which are not regulated by the concerned authority as in Delhi by DDA or in Mumbai by Maharashtra Real Estate Regulatory Authority (MRERA), etc.

These unauthorized colonies are commonly known as Slums, Blighted or Shanty areas etc. in cities. A slum is too complex to define on the basis of any single parameter. Slums are a relative concept and vary from city to city or country to country. What is considered as a slum in one city can be regarded as adequate households in another city.

On the basis of common characteristics of slums, a slum household means a house in which a group of persons are living without one or more of the facilities, such as access to drinking water, hygienic sanitation, electricity supply, sufficient living area, and durability of housing, etc. or are living in illegal building structures or informal settlement. 24% of Indian urban population lives in slums. If such a large proportion of the population lives in slums, then it is necessary to know the reasons for establishment and growth of such slums.


Industrialization started in the mid-18th century in Europe, which had spread throughout the world. Industrialization not only changed the economy from agrarian economy to industrial economy but also impacted the social life of people.

Industrialization and urbanization goes hand in hand. Industries are generally situated near areas, where natural resources like water bodies, raw materials etc. are available which ultimately lead to the establishment of number of industries within a region.

When industrialization started, it provided job opportunities to masses at a large scale and people started migrating from rural region to region near established industries, and later on these industrial regions developed into urban societies.

This process of urbanization continues even in post-industrialization period and population of urban regions has been continuously increasing. But, the bye product of the process of industrialization is creation of two classes i.e., ‘have’ & ‘have not’ or ‘owner’ & ‘labor’. The gap between these classes has been expanding which has led to the exploitation of labor class.

Because of large influx of population to urban areas, these poor labor classes don’t have enough income for access of urban living standard which is comparatively much higher than rural areas. These poor were forced to live in the urban outskirts or in the marginal lands within the cities, which resulted in the establishment of slums. In contemporary period, some of the number of reasons for growth of slums in urban areas are as follows;

  • Migration of people from rural to urban areas in search of job opportunities;
  • Poverty;
  • Economic Inequalities;
  • Social Exclusion;
  • Urbanization;
  • Poor Housing Planning or Ill Planning of the City;
  • Use of Slum for Political Benefit.

Problems faced by residents of unauthorized colonies:

A developing or developed city expects that a large influx of people would continue to come and thus, it is necessary that a city must always be planned to accommodate such huge immigration of people.

The lack of such planning has disastrous consequences which lead to the establishment of unauthorized colonies. Various kinds of problems faced by residents of such colonies are as follows;

  • Lack of proper infrastructure & denial of access to civic amenities;
  • Lack of Ownership or Transfers or Mortgage rights;
  • Non-registration of properties by registering authority;
  • Lack of any title documents in respect of such properties;
  • Denial of credit facilities in respect of properties in unauthorized colonies by the banks and financial institutions;
  • Non-recognition of sale agreement or general Power of Attorney or Will transactions as “transfers” or “sales” and the above said transactions never treated as completed transfers or conveyances and treated as existing agreement of sale.

Not only the residents face such problems but the government also loses revenue as the stamp duty and registration charges on the amount mentioned in the conveyance deed are neither assessed nor being paid on the transfer of the ownership of the properties in unauthorized colonies through registered or un-registered Power of Attorney, Agreement to Sale, Will, possession letter and other documents including documents evidencing payment of consideration.

Process of legalization:

Procedure to apply for ownership rights starts from December 16, 2019. DDA would define and delineate the boundaries of unauthorized colonies and upload the map and boundaries on a DDA portal, which will be open for suggestions from the residents for 15 days from the date of uploading of maps and boundaries on the portal.

DDA has also established over 50 helpdesks to answer all the queries and to facilitate all necessary assistance to applicants. The online procedure to apply online for ownership rights are as follows:

  • A new website will be launched on December 16 where residents can apply for ownership rights.
  • All the required documents like general power of attorney, payment receipt, possession letter need to register and upload on the DDA website by the applicants.
  • The properties will be verified on spot by the DDA officials and such officials will also help the applicants to remove deficiencies in papers, in case if there is any.
  • Ownership certificates will be provided within 180 days from the date of application.
  • To obtain ownership certificates, the residents will have to pay charges notified by the central government, along with stamp duty and registration charges on the last transaction.
  • The registration of property will be done only in the name of the woman head of the family, or co-jointly with the male member of the house.


The main object of the bill along with legalization of unauthorized colonies is also to facilitate development or re-development that may improve existing infrastructure, civic and social amenities which may lead to better quality of life of residents of unauthorized colonies.

For proper legalization to occur, the decision made by the SC in the case of Suraj Lamp & Industries (P.) Ltd. v. State of Haryana must be overturned as it held that sale transactions carried in the name of general power of attorney will have no legal sanctity. The private and public land in unauthorized colonies must be segregated as the payment charged for registration is different. The boundaries of unauthorized colonies must be demarcated and a Local Area Plan must be created. 

The objectives should be achieved as soon as possible without looking for any political benefit and without resorting to any conflict. Similar steps should be taken for regularization of unauthorized colonies in other parts of the country so that civic and social justice can be availed to all.

Author: Sahil Kumar Purvey from Hidayatullah National Law University, Raipur.

Editor: Farsana Sadiq from Faculty of Law, Jamia Millia Islamia.

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