How to buy agricultural land in Maharashtra?

Buying real estate requires a lot of understanding as there is a difference between the ways different types of properties are allowed to be bought. For instance, buying agricultural land is very different from buying non-agricultural land and a housing unit. These rules are also state specific- buying an agricultural land in Maharashtra may differ from buying one in a different state. Buying agricultural land in Maharashtra is considered to be a complex process and one should be well-aware of it so that the property remains a legal purchase. In this guide, we detail about the legal process to be followed to buy land in Maharashtra, the tax benefits and the reforms related to land.

Reasons for investing in an agricultural land in Maharashtra

One invests in agricultural land mainly for two purposes.

1)   Farming: When a person wants to take up farming for self-use he looks at buying agricultural land. Also, this is a growing business today with many people focusing on organic farming and thus, farming and scaling it to become a viable business is another reason.

2)   Farmhouse: A farmhouse can be constructed on agricultural land. This can be constructed for self-use, for renting purposes and generating revenue (home stays) or mixed model where one uses it and rents it out when not in use.

Can anyone buy agricultural land in Maharashtra?

Not everyone in Maharashtra can buy agricultural land. According to the rules related to purchase of agricultural land in the state, Maharashtra has made it very clear that only farmers can buy agricultural land. It is illegal for any non-farmer to buy agricultural land in the state.

Also, it is mandatory for a person to be an Indian national and an adult (over 18 years) to buy agricultural land. Farmers are legally verified with the help of their identity proof and farmer’s certificate.

However, it is not necessary that a farmer should have a 7/12 certificate of Maharashtra to buy agricultural land in Maharashtra. There are states like Rajasthan, Madhya Pradesh etc. that allow non-farmers to buy agricultural land. A commonly followed practice is to buy agricultural land in states like Rajasthan, Madhya Pradesh etc. and on the basis of that 7/12 extract, buy agricultural land in Maharashtra.

Note that section 63 of the Maharashtra Tenancy and Agricultural Land Act, 1948, exchange, lease, sale or mortgage of agricultural land to a non-farmer with more than two-thirds of the ceiling area is not allowed.

What is the minimum upper limit of agricultural land purchase in Maharashtra?

According to the Maharashtra Land Revenue Act, Tukdebandi is applicable in Maharashtra. According to the Tukdebandi Act, agricultural land below a standard area cannot be sold or bought in the state. Any land transaction that involves land parcels lesser than 0.4 acre (16 guntas) need approval from the collector. In case of any violation to the Tukedebandi Act, legal action is taken on both the seller and the buyer, a reason why many people are scared to invest in agricultural land in the state.

The Maharashtra Agricultural Lands (Ceiling on Holdings) Act, 1961, imposes a maximum limit (or ceiling) on the holding of agricultural land in Maharashtra by an individual or a family. With this Act in place, agricultural land is equitably distributed in the state and even landless farmers are handed over lands to farm and earn a living. One is a deemed farmer even if he belongs to a family consisting of farmers- maybe his parents or grandparents. A farmer in Maharashtra can buy a maximum of 54 acre of agricultural land.

Documents required to buying a land in Maharashtra

• Get the 7/12 extract, Form VI, Ferfar, Form 8A extract, from Mahabhulekh website or the Talati of the village.
• Land area certificate- demarcation survey and boundary of land that is verified by the circle inspector.
• Land revenue tax receipts
• Soil testing report
• Type of land- agricultural, non-agricultural and the cap upto which you can buy
• Document stating owner of land- for instance, if an agricultural land belongs to an Adivasi, you cannot buy it.
• If you are a non-farmer and buying agricultural land, then it is possible to go ahead with the deal only after getting clearance from the collector.  
• The buyer should ensure that the seller has the NOC to sell the land. Absence of sale permission will result in the deal becoming null and void.
• Agreement to sale
• Encumbrance certificate to ensure the land is not mortgaged. In case this exists, it has to be settled before going ahead with the transaction.
• Title deed: This should clearly mention the seller’s name. The verification of the deed is essential before proceeding to buy the land.
• Id- Aadhaar card, PAN Card, Voters ID

How to buy agricultural land in Maharashtra?

Mentioned are steps to follow to buy agricultural land in Maharashtra.

• Take assistance of a surveyor who will measure land area and match it with the dimensions mentioned in the documents. In case there is a mismatch, the certificate is not granted by the surveyor.
• Fix a price, pay token money and sign an agreement of sale.
• Next, collect all land related documents and pay the stamp duty and registration fees.
• Once all this is done, the SRO verifies and transfers land ownership to the buyer’s name.

Steps to register agricultural land in Maharashtra

Mentioned below are steps to follow to register agricultural land in Maharashtra.

• Submit all required documents and pay the stamp duty for agricultural land calculated based on the ready reckoner rate or the market value, whichever is more.
• An appointment has to be taken with the sub-registrar’s office where both buyer and seller has to be present.
• Once the documents are verified by the SRO, the land is registered.

How to convert agricultural land for non-agricultural purposes in Maharashtra?

Only privately owned lands can be converted. Also, only dry land areas can be converted. Wetlands cannot be converted. Mentioned are steps to follow to convert agricultural land for non-agricultural purposes in Maharashtra.

• An application for conversion with the reason has to be submitted to the commissioner of land revenue department.
• Attach supporting documents such as ID proof, original sale deed, tax receipts paid, copy of survey map and mutation certificate.
• Pay the conversion fee and wait for commissioner’s approval

Shah Rukh Khan’s daughter’s land parcel in Alibaug under scanner 

Shah Rukh Khan’s daughter Suhana Khan purchased a farmland spread across 1.5 acre in Thal village, Alibaug in June 2023 for Rs 12.91 crore. She got it registered under Déjà Vu Farm by paying a stamp duty of Rs 77.46 lakh. This land deal is now under investigation with local authorities unsure if the purchase was done by following the legal process listed by Maharashtra government. In this case, Suhana has purchased the land by providing a farmer certificate. Khan had bought this land from Anjali, Rekha and Priya, three sisters who had inherited it from their parents. As the land was given to the family by the government for agricultural purposes, selling it directly was illegal and needed an NOC to be taken from the tehsildar Collector by both the buyer and the seller. The tehsildar of Alibaug has been asked to report findings of this purchase, mention media reports.

Housing.com POV

Buying agricultural land in Maharashtra is a big and complex decision. It is imperative to follow the rules of the state when it comes to buying land, especially the agricultural one to avoid any kind of litigation in future. Also, real estate investment is generally very heavy in the pocket and thus proper due diligence should be done and professional advice from lawyers should definitely be taken before proceeding to avoid any kind of monetary loss.