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Mere Ownership of Agricultural Land Not Enough to Claim Agricultural Income, Rules ITATKarnataka Relaxes Agricultural Land Conversion for Small Industries
The Karnataka Legislative Assembly has passed a Bill to amend land revenue laws.
According to the new rules, up to 2 acres of farmland can be used for MSMEs without the need for formal conversion. This 2-acre land will be automatically converted for industrial use if it is used for such MSME units.
The bill would also exclude land-use conversion for renewable energy projects, such as solar and wind energy projects, under certain conditions, thus easing the deployment of clean energy.
A fine of ₹1 lakh is being imposed on any person who sells agricultural land for non-agricultural purposes without prior approval.
The Bill also removes an imprisonment clause: earlier, illegal conversion could lead to up to 3 years in jail, but that has been taken out.
Why This Matters
- Boost to Small Industries
- Lowers the regulatory hurdles for MSMEs to set up on small agricultural plots.
- Encourages industrial growth in rural and semi-rural areas.
- Helps start-ups and small manufacturers gain easier access to land.
Support for Renewable Energy
The Bill could quicken clean energy installations by making it easier to use farmland for energy projects.
Encourages the investment of solar and wind energy in non-urban areas.
Regulatory Streamlining
"Auto-conversion" reduces bureaucratic delays.
Powers of decision-making are being decentralised, for example, to Assistant Commissioners.
Appeals in cases of conversion would now be made to the Karnataka Revenue Appellate Tribunal, easing the workload of the higher courts.
Stricter Controls & Penalties
A fine of ₹ 1 lakh acts as a deterrent against unauthorised non-agricultural use.
Though jail time is removed, financial penalties may discourage misuse.
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Agricultural Land Laws for NRIsKarnataka High Court: Even a 60-Year-Old Compensation Claim Is Maintainable When the State Admits to Illegal Land Acquisition
In a landmark ruling that upholds constitutional property rights, the Karnataka High Court decided that when the State acknowledges that it acquired private land without following the required land acquisition process, a compensation claim—even one made after 60 years—is legitimate.
The judgment reinforces that delay cannot defeat the right to compensation when the State itself acknowledges unlawful occupation of private property.
Background of the Case
The case was filed by H.P. Ramesh and his daughter, Sushmitha, whose ancestral land had been taken over by the government around 1957. It is stated that the land was used for constructing a school building and a road, but:
- No acquisition proceedings were initiated.
- No compensation was paid.
- Repeated representations by the land owners went unheard.
In 2017, Ramesh gifted the property to his daughter, and they continued to pursue compensation. However, when they again approached the authorities, the claim was dismissed on the grounds of “extraordinary delay”—approximately 60 years.
Court’s Key Findings
1. Right to Property Cannot Be Extinguished by Time
The Court made it clear that property rights, protected under Article 300-A of the Constitution, cannot be taken away except by “authority of law.”
Since the State itself admitted that it had never legally acquired the land, the long delay could not override the constitutional right to compensation.
2. Admission of the State Is Important
The ruling was based on the government's admission that the land was taken without a lawful process, and when such an admission exists, the constitutional obligation to compensate is not ended.
3. Delay or Laches Cannot Serve as a Shield
It held that a delay is irrelevant when the State is in continued wrongful possession of private land. The obligation to compensate is a continuing liability, not extinguished by the passage of time.
4. Court Orders Compensation Under Act 2013
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Renewed legal standing may now allow many landowners whose lands were taken decades ago without due process to receive their just compensation.
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This ruling reaffirms that the State cannot evade its responsibilities regarding private property by abusing formalities.
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The judgment sends a clear message: illegally occupying private land, no matter how long ago, does not erase the responsibility of the State.
Conclusion
The Karnataka High Court's ruling is a powerful confirmation that justice has no expiration date. When the State admits irregular or unlawful acquisition, the right to compensation persists even after 60 years. In addition to giving impacted landowners hope, the ruling upholds the constitutional guarantee that private property cannot be taken without due process and just compensation.
When you’re buying a plot of land, making sure the plot is legal is just as important as the price or location. If the land is not legally clear, you could face trouble later, such as being unable to build or losing part of your investment. Here are the key things you should check.
1. Clear Title and Ownership
Ensure the seller is the real owner of the plot. Check the title deeds and past ownership records.
Verify that the ownership has been transferred properly over time (mother deed, previous sale deeds).
Ask for an Encumbrance Certificate (EC) to see if there are any legal liabilities like mortgages or liens on the land.
Check whether all past taxes, dues and charges have been paid.
2. Land-Use and Zoning Status
Confirm what the plot is legally designated for: agricultural, residential, commercial, industrial, etc.
If you intend to build a house, shop or factory, ensure the zoning allows what you plan to do.
If the land is classified as agricultural but you intend non-agricultural use (like a house or business), ensure the required conversion or permission for “non-agricultural” use is in place.
Check any local master plan or development authority map to make sure the plot is in the correct zone and is recognised for your intended use.
3. Approvals, Sanctioned Layout / Plan
If the plot is part of a layout or subdivision, check that the layout plan has been sanctioned (approved) by the relevant authority under the applicable Act.
The plot should belong to a legal layout — one that has been approved and registered, not one that is unauthorised or irregular.
Ensure the layout has proper infrastructure (roads, drainage, electricity, water) — often the approving authority will only sanction a plan if basic infrastructure is planned.
If the plot is not in a proper approved layout, you might face issues later with building permissions or municipal services.
4.Compliance with the Relevant Act (Sanction Plan)
Many states or regions have a specific statutory Act which governs land subdivisions, layouts and sanctions of plans. You need to check that the layout/plot complies with that Act.
The sanction plan means that the layout has been approved by the competent development authority under the law. Without this, the plot may be considered unauthorised.
Once the plan is sanctioned, the developer or seller should provide you with the approved plan or layout map, showing survey numbers, plot boundaries, infrastructure, etc.
Confirm that the plot you’re considering actually matches the sanctioned layout map — sometimes plots deviate, or the map is tampered with.
5. Physical Verification and Possession
- Visit the site in person: check whether the plot boundaries match with the survey/plan, whether roads and access exist as promised.
- Confirm that the seller has actual possession (or the right to hand over possession) of the plot. If the land is occupied, contested or under construction, you may get delayed or blocked.
- Check connectivity: road access, electricity, water supply, drainage—all these matter for usability and future value.
6. Documents You Must Review
- Original title deed/mother deed (tracing ownership chain)
- Encumbrance Certificate for a reasonable number of years
- Approved layout plan / sanctioned plan under the relevant Act for the area
- Conversion certificate (if agricultural land is being used for a non-agricultural purpose)
- Zoning certificate/land-use certificate
- NOCs from relevant authorities, in case of requirement
- Seller's identity and authority to sell (especially if the land is inherited or part of a company)
- Tax receipts and all dues are paid up to date
In Summary
Purchasing a plot can be a wise financial decision or the starting point for your ideal home, but only if it is usable, authorised, and clear by the law. You can guard against hidden dangers by confirming the document's authenticity, title, usage, approvals (including the approved layout plan under the relevant Act), and physical reality on-site. Take the time to do the legal homework before paying, because nothing beats peace of mind when buying land.
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