Introduction to how to buy agricultural land in Maharashtra: Agricultural land is land that is used for farming or farming purposes. In Maharashtra, only an existing farmer can buy agricultural land. The farmer can be anywhere from India. But if you check all the relevant documents well in advance, you can avoid all the problems that usually come up in land transactions in the future.
In Maharashtra, only farmers can buy agricultural land. If one of the parents or grandparents of a person is a farmer, then such person is also entitled to purchase. If a person owns agricultural land elsewhere in India, he can still be considered a farmer in Maharashtra. Depending on the type of land or the level of water supply, the maximum area of ​​such land is 54 acres. Non-resident Indians (NRIs) cannot buy agricultural land, horticultural property, or farmhouses. The total cultivable area of ​​Maharashtra is 225 lakh hectares. According to official estimates, the maximum level of irrigation potential that can be achieved is 85 lakh hectares. The department claimed that an additional 17 lakh hectares of agricultural land were being provided through indirect irrigation from wells in the command area.
A guide to how to buy agricultural land in Maharashtra, process, restrictions, documents required, the cost of agriculture land in Maharashtra, and schemes
How and why investing in agricultural land can be profitable?
1. Low level of risk and high level of capital security – Investing in agriculture is supported by a solid asset that is unlikely to depreciate. Also, past data show that agriculture has demonstrated strong capital protection features over a long period. Well-organized farming is a completely renewable resource that remains productive until it is sold.
2. Farmland is an effective inflation counter – Historically, agricultural land values ​​have generally risen faster than inflation, making agricultural land an effective means of controlling inflation and protecting capital becomes the source. This can be especially appealing to investors who are concerned about government policies on inflation.
3. Farmland is a stable income-generating asset – Unlike other mainstream options such as commodities and precious metals, farming also provides regular income to the investor, which allows him to make cash deposits and low-interest rates make a useful alternative to ‘risk-free’ income lost on bonds. Although the real estate sector may not necessarily be the most lucrative, the revenue is being generated on assets that are unlikely to depreciate.
4. Farmland investment provides low-income fluctuations – When it comes to agricultural commodity prices, long-term growth trends are caught in the event of an increase in asset capital. However, fixed rents have the effect of reducing short-term recurring instability because the risks of pricing are borne by tenant farmers rather than landowners.
5. Farmland investments provide higher total returns – Farmland investments offer both operating and capital returns in the form of a combination of rental income and asset value addition.
Can NRI Indian citizens buy agricultural land in India?
NRIs can only buy commercial and residential properties in India. It is also subject to specific rules and is subject to tax on the purchase of property in India by NRIs. In India, NRIs are not allowed to buy agricultural land, farmhouses, farms, or orchards.
Points to remember while buying agricultural land in Maharashtra
The list of the common documents that need to be checked before buying agricultural land in Maharashtra can be given below.
- 7/12 Extract – This includes some details like survey number, size of land, full names of owners, crops grown on land, hissa number, gat number, if there is any loan on land, etc. It can be downloaded from the website mahabhulekh.maharashtra.gov.in or obtained from the local Talathi office. When downloading it you will need district name, taluka, village name, and Gat / Sr number or owner name.
- 6/12 Extracts – 6/12 extracts contain mutation entries for different types of rights that have been transferred to legal heirs or land buyers. It shows the details of how the land was transferred and what other rights or conditions have been added or changed. Other names for the 6/12 extract are Fer Far, Mutation extract, Hakka Patra, and D Patrak.
- 8-A Extract – This extract is in the form of a book that shows the details of land revenue tax paid on land, types of crops, names of owners, etc. Though, it has to be read with 6/12 and 7/12 extracts.
- Soil Testing – If the purpose of buying land is to grow crops, then soil testing is very important. It specifies which crops are to be grown in the land. Soil testing can be done by government as well as private institutions.
- Reservations or Acquisitions – Reservations or acquisitions must be checked whether any part of the land has been acquired by Panchayat, Irrigation, State Government, or any other authority.
- Agricultural Land Limit – Categories must certify land. If required, a certificate of objection must be obtained from the Collector. (For non-farmers, seek guidance from local lawyers). The land size is based on the Land Selling Act of Maharashtra.
- Land Revenue Tax Receipts – The Tehsildar or Officer of the Tehsil Office issues a receipt for the tax paid on the land revenue.
- Village Map and Block Plan – This map is needed to identify the location of land in the village. This is to calculate the actual location and location on the document.
- Access roads – There must be certification by the Revenue Office. In addition, there must be a record of the approach road in register-26 of the Panchayat office.
- Original Title Deeds – They should be thoroughly examined by a legal adviser to ensure that the land is clear of all litigation and the title is clear.
- Public Notice – Notice of purchase of land should be given in at least two local newspapers to check the title of the land with the guidance of your legal advisor.
- Encumbrances – Bank loans, private party mortgages, government liabilities, or any such charges should be thoroughly checked before the sale deadline.
- Litigation – All litigation, if any, should be carefully studied before selling the land.
- Cultivators Land – This type of land as listed under Total Holding u / s 32-G is not permitted to be sold to the Collector or Revenue Tribunal. Therefore, the lands of all farmers should be strictly avoided.
- Aadivasi Lands – Aadivasi lands should not be purchased at any cost.
- Inami land – There are many conditions attached to this type of land. It is advised not to get involved in such lands.
- Demarcation, Boundaries, and Surveys – DILR and Circle Inspectors are authorized to survey the land.
- Boundary Disputes – These types of disputes need to be settled well before the actual commencing of the sale deed.
- Claims from outsiders – Any boja, isaar, power of attorney, or any claim must be settled before the sale deed.
- Family disputes – It should be well known and resolved before the sale deadline. All disputes over family, joint owners, and succession entries, etc., need to be resolved first.
- Only an agriculturist can get agricultural land. A non- agriculturist can purchase agricultural land with the prior consent of the District Collector.
- Selling Agreement – All of these terms and conditions must be drafted and executed by your legal advisor.
- Deed of conveyance – This is, after all, execution and payment of stamp duty.
- Deed Registration – Transportation must be formally registered with the Registrar of the Sub-Registrar’s Office with all stamp duty paid for legal effect.
- The names of the new owners should conclude 7/12 within six months of registration.
Legal tips for buying agricultural land
To make this difficult task more manageable for you, we have listed a few essential legal points to consider when buying agricultural land in India.
Check the title deed of agricultural land to verify ownership – The title deed of the land confirms the name of the seller and checks whether the seller has the right to sell the property. Suppose there is more than one owner of existing agricultural land in the current title deed and the previous title deed. In this case, it is recommended that the documents be checked by a lawyer before registering to ensure that the owner has not given access to others through the land.
Verify the documents and sign the land sale agreement – After all, documents have been verified, sellers and buyers must prepare and sign a written document stating the amount of the advance payment, the balance to be paid, and the actual term of the sale. All should be supervised by a lawyer and signed by two witnesses. This is an important part of buying agricultural land. Therefore, one should be very careful and read the terms and conditions carefully before signing the agreement.
Find out the stamp duty on the land – Stamp duty is another important aspect of buying real estate. Stamp duty is nothing, but property tax imposed by the government, and stamp duty imposed on land by the government varies from state to state. Stamp duty is a legal document that can be used in court.
Documents required for land registration – Land registration is a document stating the transfer of property in the name of a new buyer and must be signed by both parties in the office of the Registrar. According to the India Registration Act, 1908, a deed must be registered in the office of the Sub-Registrar, and documents such as house tax receipts, past deeds, and original deed are required with two witnesses at the time of land registration.
Sale/Conveyance deed of the land – This deed is a document that transfers ownership from the seller to the buyer. These documents contain all the required details, such as location, measurement, and boundary details.
Collect the land measurement and encumbrance certificate – This document assures the buyer that the agricultural land is free from any legal hassle or complaints. Anyone can get an incumbency certificate from the Sub-Registrar’s Office.
Make sure land record tax receipts and bills are not pending – Before jumping into buying a property, the buyer must ensure that there are no outstanding land bills or notices. They should make sure that water, electricity, or other bills are clean and up to date.
Changing the title of agricultural land – After getting done all the legal procedures and important aspects of buying agricultural land, the name of the new owner of the land is included in the records of the village office.
What should you check before buying agricultural land?
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By land, we mean a surface that is not covered by water. We use this dry piece of land for many purposes. On the one hand, we grow food for everyday use, such as fruits, vegetables, crops, and herbs.
In addition, we see millions of acres of forest and grasslands. To make it up, we can say that we use the land for agricultural projects. Similarly, whenever you plan to buy land, you need to focus on a few essential things to avoid any disappointment in the years to come. For example, if you plan to buy agricultural land, you need to know about irrigation equipment in the area. Further, we recommend that you hire a land inspector to check the quality of the soil. The professional will tell you about the quality of the land for sale and the future price. On the other hand, if you intend to purchase residential or commercial land, you must verify its zoning protocol.
The cost of agricultural land in Maharashtra
Several natural factors can affect the cost of agricultural land. The cost of agricultural land change is based on several factors like topography, agro-climatic conditions, soil health of the land, existing irrigation facilities or type of irrigation infrastructure, average annual rainfall range, infrastructure facilities like road and market, surrounding social environment, crop sampling, crop rotation tracking, and surrounding forest cover, etc., may be affected. The cost of agricultural land in Maharashtra is approximately 20 lakhs to 1 crore.
Little things keep in mind when buying agricultural land
- For buying agricultural land, make sure you are not buying disputed land
- Different states in our country have different laws for buying agricultural land. In Telangana, anyone is eligible to buy land, but in Maharashtra and Karnataka only registered farmers are allowed. So, make sure you know the standards of this state. Non-compliance with such rules can backfire
- The land must be a marketable title. You are not buying agricultural land for residential purposes.
- If you want to use an agricultural property as a residence then the conversion process will be more important. Every other state has guidelines that need to be followed based on the buyer.
- A farm must be completed and then submitted to the relevant authorities for a certificate of conversion. Make sure, you will need to state the reason for the change and submit the required documents along with the form. Remember that, get a NOC letter from the township to avoid any legal trouble in the future.
- If you are buying agricultural property, use it only for agriculture purposes. The process of change can be full of hassles. Check the record of the land you are buying and identify whether the seller is verified and trusted. It only reduces unwanted risks.
Tips for finding the perfect agricultural land for sale
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Learn about the land’s previous use – The land’s previous use can affect whether you want to buy a property. Many nutrients may not be left for your crops on land that has not been used for decades. An area that was used for industrial purposes, however, can hide toxic chemicals in dirt and water. Research the land’s previous use to avoid threats and carefully focus on finding a field with healthy soil.
Test the soil acidity and nutrients – Before you buy an agricultural farm, it is important to know the soil has the right nutrients and acidity to grow the crop of your choice.
Observe farmland soil drainage – Most crops prefer soil that drains quickly after rain. Well-drained soil helps protect plants from diseases such as stalk rot, root rot, blight, and mold. Standing water also makes room for breeding from annoying insects, including mosquitoes, aphids, and beetles that eat the leaves. You can improve farm drainage by adding perlite, sand, fertilizer, mulch, or vermiculite to the soil. If you want to start farming right away, buy a farm for sale that is already running out.
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Analyze the topology of agricultural land – Topology plays an important role in the success of the farm. Most farmers avoid steep hillsides because water can wash away essential nutrients. If you want to buy land for sale in a barren area, the topology probably doesn’t matter much. For example, many people successfully grow grapes on the hills in Arizona.
Just make sure the topography of the farm matches the needs of your crops.
Find out if the existing infrastructure meets your needs – Agricultural land contains more than healthy soil. You need farm infrastructure to help you grow and sell crops. You can break down the most important types of infrastructure into four types;
- Roads
- Buildings
- Irrigation
- Electricity
Agriculture land roads need to accommodate some large machinery like tractors, rollers, and cultivators, and also trucks.
Buildings should provide a safe place to store your goods and crops. Think beyond having a good warehouse that protects the hay from rain. You may even need to find buildings like grain silos, packing facilities, and refrigerated sheds that keep producing fresh.
Find the distance between distributors, retailers, and markets – Consider how easily you can reach distributors, retailers, and markets that buy your crops. Every hour you spend on the road is away from your fields. Find agricultural land that keeps you at a reasonable distance from distributors and retailers because you want to build an efficient supply chain. A central location that gives you easy access to many cities and towns in the region can help turn your farm into a successful business.
The legal aspect of owning agricultural land
Check the title of the farmland is the basic compliance that must be completed before purchase. It is important to ensure that there is no dispute over title and area of ​​land. The confirmation of the farmland title must be at least 40 years before the date of purchase. Ownership tracking should always begin with an examination of the initially recorded document. This is important as long as you do not want to buy seemingly fertile land that is in dispute.
The following are some of the important documents involved in the process;
Check encumbrance certificate – Before buying a plot, it is important to verify that the land is free of legal dues. This document helps to understand the burden of the property for a specific time.
Property Tax Receipts and Bills – It is recommended that you ask the seller for the previous property tax receipts as well as other bills related to the plot. This will help you avoid future tax problems.
RTC (Record of Rights, Tenancy, and Cultivation) – RTC is an annual document that is very important in verifying the title. Indicates ownership, occupation, tenancy, soil type, number of trees on the land, and other details. It is advisable to obtain the said document at least 40 years from the date of purchase as it reflects the annual ownership flow.
Some of the other important documents involved in this process are land index, mutation extract, family tree history, Patta book, and Khata certificate.
Agricultural Land Purchase Scheme
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Objectives – Financial assistance for purchase, development, and cultivation of agricultural and fallow land for farmers.
Eligibility
- Based on different agro-climatic zones across the country, small and marginal farmers are eligible i.e., who will own maximum non-irrigated or irrigated land as determined by NABARD.
- Distributor / Tenant Farmer.
Margin – There is no margin is stipulated for loans up to Rs. 50,000. In case of loans for a higher amount, a minimum of 10% margin will be stipulated.
Repayment Period – Payment term in half-yearly/annual installments of 7 to 12 years, including a maximum suspension period of 24 months.
Security – Mortgage of land purchased with a secured bank loan.
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