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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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