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Maharashtra to permit sale of lease land to raise revenue

Written by PaperDabba
Written by Sandeep Ashar | Mumbai | Published: September 15, 2018 12:17:01 am

Officials said that the conversion will be permitted for land grants to residential housing societies and agriculturists. (Image used for representational purpose)

Thousands of acres of prime public land, currently on lease, across Maharashtra could soon be up for sale. The BJP government in Maharashtra, which has been looking at new means of generating revenue, has decided to allow conversion of lands previously allotted on lease or on occupancy rights into freehold, decontrolling government’s say on such lands altogether.

Officials said that the conversion will be permitted for land grants to residential housing societies and agriculturists. The government has clarified that it won’t offer the sale option for grants allotted for public use such as hospitals, recreational grounds, educational complexes, gymkhanas, and charitable purposes, etc.

Official statistics show there are about 1,14,000 public land that have been granted on lease or occupancy basis. Most of them have been allotted for residential or agricultural use. The tony island city alone has 1,298 leased lands, which included land allotments to housing societies of elected representatives, judges, civil servants, celebrities, and state government officials. Besides around 3,000 housing societies in Mumbai have been allotted lands on occupancy rights basis. In the suburbs of Mumbai, 395 other lands have been leased for various purposes.

On Tuesday, the state cabinet debated the proposal for allowing the sale of lands allotted for residential and agricultural use. But a final decision was deferred with senior BJP ministers seeking a reduction in the one-time premiums proposed to be collected for transferring the lands to the occupiers on ownership basis.

A government panel, headed by state Revenue Secretary Manukumar Srivastava, had earlier submitted a report justifying the transfer and suggesting a revenue formula for it. For land grants used for residential purposes, it has recommended a one-time premium at 60 per cent of the ready reckoner values (market values of a plot as determined by the government), and for agricultural land it has recommended 75 per cent of ready reckoner values to be collected as the premium sum. A panel member, R A Rajeev, who was then the Principal Secretary with the Finance department, had however found the premiums proposed in the case of residential societies to be less and has submitted a dissent note seeking that even this should be raised to at least 75 per cent.

Some senior government officials echoed Rajeev’s viewpoint. Some of them even felt that the “government should not dispose off these lands since they are a constant revenue stream for the government.” Requesting anonymity, one of them said, “It is like selling all the family gold.” Another official remarked, “If the government wants to sell lands, they must take at least dispose these off at real market rates which are higher that the ready reckoner values. In cities like Mumbai where land commands a premium, we must charge 125% or more of the ready reckoner values if the lands are to be sold.”

Incidentally, the Fadnavis cabinet felt otherwise. Senior ministers felt that premium rates proposed for both residential and agricultural land grants should be brought down further, raising eyebrows even among senior bureaucrats. For land grants on lease or occupancy rights basis there are restrictions over transfer of apartments, transfer of land or change of us since their ownership vests in the government. The state’s revenue department is also able to collect regular revenue for permitting such transfers. Converting such grants on ownership basis will permanently lift these curbs and transfer full rights on the holders. Despite opposition from land activists, the Fadnavis government had taken the first step for the decontrol exercise in March, 2016 itself when it had made an enabling provision in the Maharashtra Land Revenue Code (1966) for permitting conversion of land tenures allotted on occupancy rights to ownership basis.

Back in 2012, the then Congress, Nationalist Congress Party government in the state had invited public flak for permitting conversion of lease lands to occupancy rights at 100 per cent of the ready reckoner values. While the BJP government had said in 2016 that the concerns expressed by the activists and the general public would be factored in while devising the formula for such transfers, the government’s latest proposal is to award ownership rights to such land holders at less than the ready reckoner values.

The government has argued that the decontrol measure will rev up the economy. “We estimated to collect at least Rs 20,000 crore through premiums from the conversion,” a minister said. But some officials remained sceptical. “The 2012 policy which allowed conversion of lease lands into occupancy had received a lukewarm response. Several land holders found it difficult to pay the premium amount,” said one of them. Another justification being offered is that freeing up these lands from the clutches of the permission raj would result in an increase in land transactions on such lands, resulting in increase in revenue from stamps and registrations. Incidentally, the move will also clear decks for the regularisation of unauthorised use or transfer of such lands.

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