With the economic liberalization and globalization in 1990s, urbanization in India became a cake-walk. Cities are spreading and developing, acquiring the agricultural land for transforming into commercial and industrial projects. However, barren lands over fertile lands have always been preferable to use it for non-agricultural purposes. To delve deeper into this conception, let us understand what significantly means when we say agricultural and non-agricultural land which have been dealt in the following few lines respectively.
Agricultural land in general sense means an area of land used for agrarian utilization particularly for growing crops, rearing livestock with a common objective of providing food to humans.
The United Nations Food and Agriculture Organization (FAO) claims agricultural land as the amalgamation of different types of lands which have been described hereinunder:
- Arable Land – This land is used for allowing replanting or fallow land within any five years period. Thus, this land is also called crop land.
- Permanent Cropland – This land is used for producing crops not allowing replanting in a year.
- Permanent Pastures – This sort of land includes the grasslands either naturally or artificially utilized for grazing livestock.
For instance – Land devoted for the use of cultivation of paddy, wheat, coffee, rubber could be termed as a cultivable land. Hence naturally it is an agricultural land.
Legally speaking, section 2(14)(ii) of Income Tax Act, 1961 defines agricultural land as:
Agricultural land in India, not being land situated:
- In an area which is under the jurisdiction of a municipality, municipal corporation, town area committee or a cantonment board having a population not less than ten thousand in accordance with the preceding census of which the relevant figures have been published before the previous year.
- In an area not being a distance more than eight kilometers from such municipality, cantonment board etc. for having a scope of urbanization of that area by the central government.
As the name suggests, non-agricultural land refers to the land other than agricultural land. In simpler words, non-agricultural land means the land upon which no agricultural operation can be carried out and from which no agricultural products and benefits are derived out. It generally, inculcates the barren land and unproductive land which are used for urbanization, commercial or industrial purposes.
For instance – Non-agricultural land involves the land which may be used for residential purpose i.e for building housing complex.
CONVERSION OF AGRICULTURAL LAND INTO NON-AGRICULTURAL LAND IN DIFFERENT STATES OF INDIA
Land allowed for agricultural purposes cannot be converted for non-agricultural pursuits without undergoing few set processes and if by any chance agricultural land is used for non-agricultural purposes, it will be a sheer instance of illegality.
Agriculture being a subject of state, involves different procedural conversion patterns followed by different states in India. Mostly, the land-owners approaches the revenue department with a view of land conversion for example in states like Uttar Pradesh, Karnataka, Maharashtra, people visit the revenue department in their own cities. However, the situation is completely different in Rajasthan, where the process is framed in accordance with the size or area of the land. People of Rajasthan approach the tehsildar in case of land having size of 2500 sqm, the sub-divisional officer in case of land having size between 2500 sqm and 10,000 sqm and for bigger land sizes, permission has to be drawn from the collector or the state government of Rajasthan.
Similarly, in Odisha, Andhra Pradesh, Bihar, the approval for converting land is drawn from the tehsildar or sub-divisional officer as prescribed by their respective state legislations. However, nowadays documentation and application procedures are done through online portals.
In states having no prescribed procedure to submit applications to certain authority, the same can be written to the collector, commissioner or the district magistrate for land conversion.
GENERAL PROCEDURE OF CONVERTING AGRICULTURAL LAND INTO NON-AGRICULTURAL LAND
A land-owner having an agricultural land can convert the land into non-agricultural land i.e a barren land for residential or commercial purposes after undergoing a set of processes. Although there is no uniform set of procedure for every state in India, but there are few processes which are same for every state and have to be mandatorily fulfilled and these procedures are hereinunder prescribed:
- APPLICATION – The first and foremost step involves getting approval from the competent authority to convert an agricultural land into non-agricultural land. Such competent authority is usually from the revenue department, be it collector, SDO or tehsildar depending on the prescribed legislations of each state.
The application consists of the very purpose for such conversation and necessarily comprises of the following documents:
- Original sale /gift/partition deed
- Mutation letter
- Certified survey map
- Latest receipt of tax payment
- ID proof
- FEES PAYMENT – A requisite fees has to be paid in accordance with the rules prescribed by land revenue rules set for every state. This fees also considers the size, location, nature and amenities associated with the land.
- DUE DILIGENCE– The process is enumerated over here.
- An enquiry is conducted by the revenue department where the application is submitted to ascertain information relating the land’s ownership, type, area and encumbrances if any.
- The circle officers visit the site to see if the land is vacant or not, to check the absence of any structure, to inspect the alignment of high-tension electrical lines and to know about probability of any litigation or dispute associated with the land.
- The final step involves verification from PCB, Land Acquisition Department and other responsible authorities.
- AUTHORISATION FROM PLANNING AND DEVELOPMENT AUTHORITY – The Planning and Development Authority gives due authorization after considering:
- The Development Control Regulations
- Master Plan of the authority
- Building bye laws
- Coastal Regulations zone, forest zone restrictions etc.
If there is an availability of objection forwarded by the said authority, it has to be submitted in writing to the collector or sub-divisional officer in the Revenue Department.
- APPROVAL– After accomplishing all the procedures mentioned in the above lines, Conversation of Land Use can be granted by the authority considering the following conditions:
- Payment of due charges by the applicant.
- Applicant follows all the terms and regulations prescribed by the due authority and legislations.
- Land shall not be utilized for any other purpose other than the purpose for which permission is granted.
- LATER PROCEDURE-There are certain later processes to be accomplished after undergoing the above-mentioned procedures which are enumerated below.
- After undergoing all such mentioned procedures and getting the grant of the non-agricultural land, the applicant has to begin his non-agricultural functioning within 1 year from the date of demarcation order.
- The applicant has to inform the tehsildar of his jurisdiction about such conversion within 30 days from the date of order and the tehsildar thus, makes changes in the land records accordingly.
NECESSARY INGREDIENTS FOR CONVERTING AGRICULTURAL LAND INTO NON-AGRICULTURAL LAND
- ID proofs of the owners must be produced.
- The whole procedure must be accomplished in a limited time frame, if the timeline is breached, the whole procedure has to be reinitiated.
- On finding out that the land is being used for purpose other than what is written in the conversion application, the owner of such land shall be penalized.
- NRIs are forbidden to purchase agricultural land in India. However if such land undergoes the due procedure for converting itself into a non-agricultural land, they are given access to buy such converted land.
Thus, the above points justify that agricultural lands are indeed converted into non-agricultural lands subject to the application of the ingredients mentioned above.
RELEVANT CASE LAWS
- In Motibhai Patel (vs) CIT, 131 ITR 120 (Guj) (1981), the court held that if the transferee changes any agricultural land into non-agricultural land or divides the area into two distinct plots, the transfer of land would not amount to rise to capital gains tax in the hands of transferor.
- In M/S Mahabaleswarappa And Sons (vs) Commissioner of Land Revenue, AIR 1997 AP 85, 1996 (4) ALT 334, the court held that the question, if an area of non-agricultural land is a waste land or is actually a kind of agricultural land is a pure question of fact depending on each case and if it is proven to be true, no assessment shall be made considering it as a non-agricultural land.
- In Chhotalal Prabhudas (vs) Commissioner of Income Tax, 1979 116 ITR 631 (Guj), the court contended that if a non-agricultural land has to be used for agricultural functions, the land has to be permitted to lie fallow with fixation of nitrogen in the soil as suggested by the scientists for its utilization as an agricultural land.
In this growing age of urbanization and globalization, more agricultural lands are converted into non-agricultural lands for residential and commercial purposes which have cascaded the density of agricultural lands in India leading to various socio-economic hindrances. Hence a due procedure with accurate strictness is followed for such conversion for mandating a structured economy with an aim of abolishing agricultural misconduct.
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