A GUIDE TO LAND ACQUISITION

IN MAHARASHTRA
Authors: Avikshit Moral | Preeti Dhar
NOVEMBER 2023
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INTRODUCTION

The process governing sale of land in India are manifold and vary across states. One of the biggest
concerns for a prospective buyer is to gather information/literature on local laws and regulations
prior to purchasing land. At the end of the day, whilst purchasing land, the concept of “let the
buyer beware” prevails. This process note endeavors to give a bird eyes view to any interested
person who intends to acquire land in Maharashtra. In this note, we have tried to cover (i) various
steps/laws involved in purchase of land parcels in the State of Maharashtra and (ii) the points to
be considered prior to acquiring land in the State of Maharashtra.
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STEPS INVOLVED IN THE PROCESS OF SALE

PRELIMNARY
DOCUMENTATION

DUE DILIGENCE

OBTAINING
PERMISSIONS FOR
SALE OF LAND

DOCUMENTATION

UPDATION OF
RECORDS
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STEP I : PRELIMNARY DOCUMENTATION • Analyzing permissions required for sale of land (if
any): In the State of Maharashtra, it is to be ascertained
• Interested parties enter into a preliminary agreement
whether any prior permission is required from the
recording the terms of sale between a seller and a
Collector or any statutory authority for sale of land
buyer.
under (i) Maharashtra Tenancy and Agricultural Lands
Act, 1948 (“MTAL Act”) (in case of agricultural land);
• Terms include consideration, manner of payment &
or (ii) Maharashtra Prevention of Fragmentation and
certain conditions to be complied prior to the sale.
Consolidation of Holdings Act, 1947 (“Fragmentation
Act”) (in case of fragmented land), or (iii) Section 36A
of Maharashtra Land Revenue Code (in case of land
STEP II: DUE DILIGENCE belonging to tribals) etc.

• Search in revenue records & review of title deeds: • Use of land as per zone certificate: Prior to purchase
The prospective buyer should through their lawyer of land, it is essential to determine the zone/usage
conduct investigation of title in respect of the of land (residential/commercial/industrial etc.) to
subject land. Such investigation of title will include ascertain whether the proposed activity which the
(i) conducting online and physical searches in the buyer intends to conduct on the land is permissible as
revenue records in respect of the land; (ii) review and per the zone allocated by the concerned authorities.
inspection of title deeds to establish chain of title and
if there are any defects in title; (iii) ascertain if land
is agricultural in order to determine its implication
STEP III: OBTAINING PERMISSIONS FOR SALE OF
on the transaction and (iv) mitigation of risks (if any).
LAND
In the state of Maharashtra, the revenue records
(7/12 extracts/Property Card, mutation entries)
It is essential that any permissions required to be
are accessible on the Mahabhumi portal (https://
obtained for sale of land as mentioned above are taken
mahabhumi.gov.in/mahabhumilink) which is an online
prior to entering into the sale deed and the same should
portal introduced by Government of Maharashtra
be made a condition precedent to the execution and
to access land records and other property related
registration of sale deed.
details.

• Litigation Search: As a prospective buyer, it is not

STEP IV: DOCUMENTATION
possible to conduct physical search in all of the courts
within whose jurisdiction the subject land is located. A
• Adjudication of stamp duty payable on the sale
purchaser can conduct such litigation searches on the
deed: The buyer can submit the draft of sale deed for
official websites of various courts or through external
adjudication before the Collector of Stamps under
agencies. The Government of Maharashtra has also
Section 31 of the Maharashtra Stamp Act in order to
started providing access to details of pending civil
determine the correct stamp duty payable on the sale
court cases in respect of a particular 7/12 extract/
deed.
Property card on the Mahabhumi portal.

• Payment of stamp duty & registration fees: Stamp

• Encumbrances search: It is important to ascertain if
duty and registration fees payable in respect of the
there are any existing encumbrances in respect of the
sale deed can be made online and in this behalf the
subject land such as mortgage, pending taxes etc.
Government of Maharashtra has provided 2 modes of
online payment. First mode is paying the stamp duty
• Issuance of public notice: A public notice should
and registration fees through GRAS (Government
be issued through the lawyer conducting diligence
Receipts Accounting System) (https://gras.mahakosh.
to ascertain if there are any third party claims in
gov.in/echallan/). The other mode of online payment
respect of the subject land. Such public notice also
is vide e-SBTR (Electronic Secure Bank & Treasury
establishes that buyer is a bonafide purchaser.
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Receipt) system where stamp duty can be paid basis the outcome of title diligence, the Purchaser can
online and there are certain specific banks which are obtain any undertaking/declarations from the seller.
authorised to issues E-SBTR.

• Execution & Registration of transaction documents:

STEP V: UPDATION OF RECORDS
The Parties will execute and register the sale deed,
power of attorney to be given by seller to buyer (for
• Pursuant to the execution and registration of sale
updation of records, admitting execution of sale deed
deed, application is to be made for updating 7/12
etc.). Necessary information in relation to registration
extracts/PR Card/municipal records and name of
of documents is available on the official website
buyer is added as owner in revenue records/municipal
of the Department of Registration and Stamps in
records.
Maharashtra (https://igrmaharashtra.gov.in/). Further,
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ISSUES TO BE CONSIDERED PRIOR TO

PURCHASE OF LAND PARCELS

Basis the various transactions that we have worked on, The definition of “bonafide industrial use” goes
we have come across the following pain points which are on to list down the activities which constitute
germane to sale of land parcels in Maharashtra: bonafide industrial use, however the definition is
not exclusive and hence open to interpretation.
• Section 63 of MTAL Act: We have come across cases wherein a given
As per Section 63 of the MTAL Act, an agricultural activity may not get covered under the definition
land cannot be transferred to a person who is not an of “bonafide industrial use” but the activity
agriculturist without the permission of the Collector or may still deem to be bonafide industrial use
an officer authorised by the State Government. In the considering the nature of the activity. In such a
given scenario, it becomes crucial for a prospective scenario, it is advisable to seek clarity from the
buyer to ascertain whether land is agricultural or non- concerned authority prior to taking benefit of
agricultural. However, the aforesaid permission is not exemption under Section 63(IA) of the MTAL Act.
required in two scenarios as mentioned below:
Further, in cases where the seller itself had
– Purchase of land situated in specific jurisdictions acquired the land parcel under Section 63-IA of
and land allocated for non-agricultural use as MTAL Act, it is to be ascertained if subsequently
per Section 63(1C) of the MTAL Act: As per the seller has put the land to bonafide industrial
Section 63(1C) of the MTAL Act, for the purpose of use within the time period prescribed under the
transfer of an agricultural land to non-agriculturist, Section 63-IA of MTAL Act and there is no violation
the permission for transfer of the Collector is not of the provisions of 63-IA of MTAL Act. For a buyer
required if the land is situated within the limits acquiring agricultural land for bonafide industrial
of a Municipal Council or Municipal Corporation use under Section 63(IA) of the Act, the land is
or within the jurisdiction of a Special Planning required to be put to bonafide industrial use within
Authority or a New Town Development authority a period of five years from the date of purchase
appointed or constituted under the provisions of with a further extension of five years subject to
the Maharashtra Regional and Town Planning Act, payment of non-utilisation charges as prescribed
1966 (“MRTP Act”) or any other law for the time under the MTAL Act by the buyer.
being in force, and also to any land allocated to
residential, commercial, industrial or any other One other aspect to be considered is that if the
non-agricultural use in the draft or final Regional land parcel does not fall under the exemption
plan or Town Planning Scheme, as the case may provided under Section 63(1C) or Section 63(IA)
be, prepared under the MRTP Act or any other law of MTAL Act and buyer intends to convert the
for the time being in force. land to non-agricultural land, it is advisable that
such conversion and necessary payments towards
In order to ascertain whether the land falls
conversion of land should be done prior to
under any of the exempted areas as mentioned
entering into the sale deed. This also becomes
in Section 63(1C) of the MTAL Act, one needs
crucial considering that (i) the application for
to analyse the zone certificate issued by the
conversion is to be made by the owner/occupier
competent authority. In case where the exemption
of land as per Section 44 of Maharashtra Land
under Section 63(1C) of the MTAL Act is available,
Revenue Code, 1996 and (ii) taxation laws for
the buyer pursuant to the sale deed can pay the
agricultural land are different as compared to non-
conversion charges whilst obtaining development
agricultural land.
permission in respect of the land parcel.

• Purchase of land acquired under Section 32G of

– Purchase of land for bonafide industrial use
under Section 63(IA) of the MTAL Act: As per the MTAL Act:
Section 63-IA of MTAL Act, a person can sell land Section 43 of MTAL Act provides that no land
without permission of the Collector, to any person purchased by a tenant under Section 32 of MTAL
who is or is not an agriculturist and who intends to Act, shall inter alia be transferred by sale without
convert the same to a bonafide industrial use or the previous sanction of the Collector, which may be
for Integrated Township Projects where such land subject to such conditions as prescribed by the State
is located within the areas as mentioned therein. Government. In case where a buyer is purchasing a
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land from a tenant who acquired land under Section • Other Laws:
32G of the Act, one has to ascertain that necessary Whilst purchasing a land parcel in Maharashtra,
orders are in place regarding transfer of title in favour a prospective buyer also needs to be aware of
of the tenant. various local laws such as Maharashtra (Urban Areas)
Preservation of Trees Act, 1975 which provides for
• Access to land parcels: obtaining permission of tree officer for felling of
It is important to ascertain whether road connecting existing trees on the land. Further, in case of a land
to the land parcel is a DP Road. In the event the road which is declared as fragment, the provisions of
connecting to land parcel is a private road, it is to Fragmentation Act will apply. As a buyer, one should
be checked if the road belongs to the seller. If not, be aware of the local laws that may affect or impose
the buyer should insist that simultaneously with the restriction on transfer of land.
sale deed, the seller should obtain a right of way in
The issues highlighted above are not exhaustive
respect of the road connecting to the land parcel.
and there may be other issues that may impact a
transaction in relation to purchase of land parcels in
• Conducting physical survey of land: Maharashtra. Keeping in consideration that in the
There are several instances where the area of the State of Maharashtra, there may be instances that on
land parcels mentioned in the title deeds differs from account of nature of the land, manner of acquisition
the area mentioned in the revenue records. In such a will be different. In certain cases, the land may be
case and as a matter of abundant caution, a physical part of collectors land or comes under the purview of
survey of the land parcel should be conducted in special planning authority and as such the acquisition
order to ascertain the actual area of the land parcel as of such land will be governed by laws prescribed by
this may impact the consideration payable by a buyer these authorities. Additionally, it may be the case
for purchase of the land parcel. that land parcel may be devasthal or wakf land or
Adivasi land or inam land or an evacuee property on
• Discrepancy in description of land parcels: account of which there will be restriction on transfer
There are several instances where land parcels have of land or the rights which can be created on such
undergone sub-divisions multiple times. The survey land parcels. In addition to the above, there are cases
no. or gat no. or CTS no. and the respective areas where the land is owned by a government authority
that are mentioned in title document may have been such as Maharashtra Housing and Area Development
split on account of various sub-divisions and the Authority, City and Industrial Development
description in the title document and the revenue Corporation, Maharashtra Industrial Development
record varies. In such a scenario, it is essential to map Corporation etc. then the underlying transaction will
the old survey nos. or gat nos. or CTS nos. with the not be a sale and will be a lease for a specific time
new survey nos. or gat nos. or CTS nos. period. In such a scenario, as a prospective lessee/
sub-lessee, one will have to ascertain restriction on
Also, the boundaries of the land parcel should be transfer of leasehold land as the same may attract
clearly established vis a vis the survey plan/CTS plan payment of transfer charges/premium etc.
of the land parcel.
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Avikshit Moral Preeti Dhar

Partner, Mumbai Principal Associate, Mumbai
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DISCLAIMER

This note is for information purposes only. Nothing contained herein is, purports to be, or is intended as legal advice, and you should seek
legal advice before you act on any information or view expressed herein. Although we have endeavored to accurately reflect the subject matter
of this note, we make no representation or warranty, express or implied, in any manner whatsoever in connection with the contents of this note.
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