Introduction to how to buy agricultural land in Uttarakhand: Uttarakhand previously known as Uttaranchal is located in the northern part of India and is famous for its hilly areas and places of pilgrimage for Hindu pilgrims. With increasing purchasing power, investors in India are looking for innovative ideas to maximize their investment. One such method is to invest in agricultural land. Some investors hold such land as an asset, there is a segment of investors who take benefit of the growing market for organic fruits and vegetables to supplement their income. The major crops grown in the state are Rice, Wheat, Sugarcane, Maize, Soybean, Pulses, Oilseeds, and various fruits and vegetables.
Uttarakhand has four agro-climatic zones covering six-altitude farming methods, which means that the state has the potential to grow a wide variety of crops. It has diverse agro-geo-climatic conditions, most suitable for horticulture and floriculture. The total geographical area in Uttarakhand is about 53.48 lakh hectares of the state, about 7.01 lakh hectares of land is under crops and about 2.79 lakh hectares is under horticultural crops. To promote cluster farming in the state, the government has made arrangements to lease agricultural land for 30 years for farming, horticulture, and other related activities.
In the state, farmers generally adopt two types of farming methods namely rainfed and irrigated. Most of the agricultural land in Uttarakhand is rain-fed. Approximately, the net irrigated area of the state is 3.38 lakh hectares. For the state, the ratio of net irrigated area to net sown area is 45%. Due to the large area under the hills, irrigation is available in most of the plains and valleys. Therefore, alternative sources of irrigation need to be created to increase the net irrigated area, which in turn will increase the crop intensity of the state.
These alternative sources could be rainwater harvesting, check dams, elevator irrigation, etc. Technologies like drip irrigation, sprinkler, etc., can be used for better water management. Recently, the Uttarakhand government has increased the land circle rate in the state. Circle rates for agricultural, non-agricultural, and commercial lands have been increased by 15%. An in-depth understanding of the market is required for buying agricultural property in Uttarakhand.
Guide on how to buy agricultural land in Uttarakhand, certificates needed, Rules, checklist for registration of conveyance sale deed, benefits
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Agriculture land use in Uttarakhand
A majority of the area of Uttarakhand is covered by forests and wastelands. More than 60% of the land is classified as forest, 5% is barren and uncultivated, leaving very little area for cultivation in the state. As a result, the net sown area in the state is only 700171 hectares. The net sown area also shows the wide variation between the hilly and plain areas of Uttarakhand. The percentage of net sown area in Haridwar and Udham Singh Nagar are plain districts as compared to the total area of the district is 52.18% and 53.57% respectively. Some districts like Uttarkashi (3.79%) and Chamoli (3.84%) cultivate very little of the total area.
The small amount of net sown area in the state means that agricultural production is limited and therefore farmers have used limited agricultural production for many years to meet their domestic needs. Therefore, it has been one of the reasons for nutrition-based agriculture in the state. Most of the agricultural land in Uttarakhand is rainfed and only a small portion of the total agricultural land is irrigated. Difficult geographical barriers severely limit the development of irrigation facilities in the mountainous districts of the state.
Is it worth buying agricultural land in India?
Investment in agricultural land is capital-intensive. Keep in mind investors have a clear financial plan before investing in agricultural land. Like all assets, farmland has periods of stagnation and periods of growth and decline. However, the overall trend is a steady and permanent increase in intermediate values. This is a good investment.
Certificates needed to buy agricultural land in Uttarakhand
Before purchasing land it is important to verify that there are no legal obligations on the land. Check the Incumbency Certificate (EC) issued by the Sub-Registrar’s Office where the deed is registered (in Uttarakhand), stating that the said land has no legal obligations and no complaint.
An Encumbrance certificate is required to prove that there are no outstanding legal obligations or mortgages on the plot. This is one of the important documents that banks ask for before lending to you. This certificate also contains all the details related to the past transactions of the property. In India, Form 15 is issued if a load is registered on a property. Although, Form 16 will be given to the owner, and stating there are no encumbrances. An encumbrance certificate for the last 13 or 30 years can be obtained from the office of the Sub-Registrar, to ensure that there is no legal liability on the agricultural land.
Payment of stamp duty
Make sure to verify the title documents to check the payment of stamp duty. If the property owner has changed more than once, review all the documents for payment of stamp duty by the predecessor. Today, many states (including Uttarakhand) have amended the stamp law to allow for the formation of a charge on property in the event of a reduction in stamp duty on any document relating to the property. Therefore, the current owner of the property is liable to pay deficit stamp duty and fines, if any, on the previously registered documents.
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Check the property title
The property title forms the basis of any agreement. Verify seller title before purchasing a property. Records can be searched at the Sub-Registrar’s office for documents that affect the property and may be registered. The report will show the recorded property title owner and changes in the property title. If the land is agricultural, then check the account, khata, and title deed can be requested from the seller.
The assessment register ledger entry is known as Khata and it is a supporting document of title. This is the current owner’s entry in the municipal / panchayat records relating to the property. It is necessary for loans, title opinions, and electricity meter name changes, etc. The entry of the assessment register ledger is changed after the execution of the sale deed or after the inheritance of the property through a will, gift, and distribution, etc.
Personal inspection of agricultural land under sale
Beware of buyers is a golden mantra in immovable property transactions. The buyer is responsible for title verification, ownership, and possession of the property. He should take all reasonable steps to ensure that he is buying property from the right person and also the right property. The important precaution is to inspect the land under sale. During the personal inspection, the buyer will inquire from the neighbors about the ownership and possession of the property, disputes if any, the role of the seller, charges/mortgage on the property, and part of the property, etc.
This is the most important aspect of title verification, so it is best to have at least three people on behalf of the buyer. And they will make separate inquiries to various people in and around the property, such as local elders, longtime property owners/tenants, laborers, etc. In densely populated areas it is easy to inspect the site and the building. It is also easy to inquire in villages where people can recognize people by name. But it is difficult to question suburban, newly developed, and converted agricultural land as plots – where there is no housing. In these cases, it takes a lot of effort to get the right answers to the questions, and sometimes we don’t get the answers at all because there is no one to contact except the shopkeeper or his men.
Engage a competent lawyer
There are many rules involved in real estate transactions. Therefore, it is better to involve a competent lawyer to investigate the title, possession, ownership, and other aspects. The lawyer will be an associate and his scope of work will include title scrutiny, negotiation, drafting of agreements/sales practices, payment of consideration, registration of documents, mutations, etc.
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When copies of documents are offered for viewing, the buyer will only have to rely on them, but can also apply for certified copies instead. Also, get certified copies of back documents. Sale deed copies are the office of the Sub-Registrar and are given to anyone on request after paying a fixed fee. A power of attorney is a document in which the principal authorizes an agent to act on his or her behalf. Through executive directives, today, in Uttarakhand, if a power of attorney is given in respect of immovable property, to enable the interested parties to obtain a certified copy of it. The move is a progressive one as it would somewhat check fraud under the guise of power of attorney as it is no longer a secret document.
Rules for buying agricultural land in Uttarakhand
Uttarakhand has rules that work in favor of buyers. There are no state restrictions on property ownership. Therefore, people from different states can buy agricultural property in Uttarakhand. Also, there is no restriction on the size of the property. However, there are some restrictions on buying agricultural land outside the city limits. Individuals are allowed to purchase a maximum of 2,690 square feet of land. Although there are restrictions on the purchase of agricultural land in Uttarakhand and areas outside the municipal units, the protesters demanded stricter land acquisition laws as in other states.
Laws for purchase of agricultural land in Uttarakhand
What is the current status of law in Uttarakhand on the purchase of agricultural land by a person belonging to another state of India?
Land laws prohibit the purchase of more than 250 square meters of agricultural land outside municipal boundaries, but this limit can be relaxed by state government officials, including the district magistrates of the districts concerned. Under the Land Selling Act, all citizens in India can purchase up to 12.5 acres of agricultural land in Uttarakhand. Any person who belongs to another state of India who has been living continuously for the last 5 years while the voter cardholder of Uttarakhand can immediately buy agricultural land in Uttarakhand.
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Mistakes to avoid while buying agricultural land
Make sure one must consider the importance of the land title. Check the farm title before buying it. This is mainly beneficial in two ways. They are, firstly, it helps to avoid legal complications and secondly, it helps to get the land faster. Buyers must be aware of agricultural land laws mainly if they belong to another state. Agricultural land-buying rules can vary in different states. As the buyer must know the soil quality and other properties.
Legal documents required before buying agricultural land in Uttarakhand
The title deed of the land plot
It confirms the seller’s name and confirms whether the seller has full right to sell the property. The current practice and past practices must be examined by a lawyer to confirm that the seller did not allow access to others through the land. If the agricultural land is owned by more than one person, a release certificate must be obtained from the other participants before the documents can be entered.
Find out the address of the land
Find out the exact extent, survey number, and boundaries of the land you intend to buy and the Revenue Village in which it is located. It is important to know if the details of the land shown on the paper and the land on the ground are the same. Village map, Tippan / Pahani / Adangal will help to know these details. It is helpful to survey the agricultural land before proceeding with the purchase.
Sale deed of the land
It is a document that transfers the property title from the seller to the buyer. This sale deed will help you find the owner of the property, where the property is located, and details such as site measurements, boundary details, etc.
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A sale deed is the most important document needed to buy a plot. The sale deed must be submitted because it establishes ownership of the property title. You need to register the sale deed at the Sub-Registrar’s office in the area where the property is located.
Khata certificate is an important document for the new plot registration. This is also important if you want to transfer ownership of the plot at a later stage. This document is proof that the plot is registered in the local municipal records. Banks ask for this paper before giving you an agricultural loan.
General power of attorney
This document is needed to prove whether the purchase and sale of a particular property are being done by a property owner through an authorized person. To get an agricultural loan, one has to prepare it.
An allotment letter is one of the most important documents required to obtain an agricultural loan. It is issued by a developer authority, detailing the property and the amount paid by the buyer to the developer. You should keep in mind that an allotment letter is not like a sale agreement. It is issued to the first owner and the second owner can request an original letter copy from the seller.
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The sale agreement contains information about the plot, including terms and conditions, date of occupation, payment plan, and plot details. The contract also holds the developer responsible for the completion of the property. This document must be submitted to purchase the property and obtain an agricultural loan.
Tax receipts and bills
The buyer checks the latest property tax bills and inquires at the municipal offices. The buyer ensures that the notices or requests for the property are not pending.
Property tax receipts
Property owners must pay taxes. Make sure the former occupant/owner has paid the property tax and there are no obligations left. Property tax receipts also help prove the legality of the property.
How to register an agriculture property in Uttarakhand?
To register a sale deed in Uttarakhand, the buyer has to submit the following documents.
- Original documents of the property signed
- Certificate of Encumbrance
- Proof of identity
- Proof of address
- Power of attorney
- Certificate of the value of property
Rules for the purchase of agricultural land in Uttarakhand
Earlier laws – In 2007, Uttarakhand had lowered the ceiling of agricultural landholding in the Uttarakhand for ‘outsiders. The law states that “non-tenure holders can purchase up to 250 square meters, up from the previous limit of about 500 square meters.” The amended law states that non-term holders can now purchase up to 250 square meters of agricultural land for residential purposes. The law also applies to extended families. Cannot purchase more than 250 square meters of land in the name of dependent persons, parents, spouse, or unmarried daughter. However, there is no restriction on the purchase of apartment units in the state.
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In September 2003, the Uttarakhand government issued an ordinance to regulate the sale of agricultural land. Farmers registered in the Revenue Record can buy agricultural land. Others can submit their application to District Magistrate (DM) and Divisional Commission. Had to send it via mail. The ordinance also prohibits the sale of land based on power of attorney.
The Uttarakhand High Court on September 22, 2011, struck down a highly controversial land reform in the state, barring outsiders from buying more than 250 square meters of agricultural land. Any person who is a citizen of India under the Land Selling Act can buy 12.5 acres of agricultural land in Uttarakhand. Earlier, the existing land laws discriminated against the people of Uttarakhand as no person who had no agricultural land before the enactment of the Act in 2003 was eligible to purchase more than 250 square meters of land.
Checklist for registration of conveyance sale deed
- Original document.
- Print copy of e-challan duty/fee.
- Stamp duty.
- Registration fee.
- Document handling charges,
- Printed copy of PDE details,
- Land revenue record as khasra, khatoni as applicable in deed.
- Map of the transferred property.
- Current passport-size photographs of the parties.
- Current photo of the transferred property.
- Image ID card (Voter ID card, Kisan bahi, bank passbook with photo, employer ID, ration card with photo, Aadhar card, LPG gas passbook with photo, PAN card, driving license, arms license with a photo of all parties, and witnesses for entry of document, voter list with photo, certificate of degree/mark sheet with photo and passport.
- Pan Card copy is compulsory where valuation is above 5 Lakhs.
- TDS challan is required under Income Tax Act only for the sale of agricultural lands amounting to more than Rs. 50 lakhs.
- Uttarakhand (adaptation and modification in order, 2003) (Amendment) Act No. 29/2003, if the Buyer and his family members are immovable property owners before the date 12-09 -2003 in Uttarakhand is the deed must be presented for khatauni and another authenticator.
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Benefits of buying agricultural land in Uttarakhand
State regulations are in favor of purchase – The state is open to investment by the people of the states. The government has clearly stated shopping restrictions for people living outside the state. There is no restriction on the property size if one is buying within the municipal limits of the cities. However, by law, a person can only buy 250 square meters of agricultural land that falls outside the city area. It also means that two or three members of the same family can buy parcels of 250 square meters of land separately or remotely. However, if the agricultural land is within the city limits, one has to comply with the state’s Land Ceiling Act.
Purchase of land for agricultural purposes
The purpose of this scheme is to provide term loans to small / community farmers in which shared cultivators/tenant farmers have to buy agricultural land as well as produce and cultivate fallow land.
- The first eligibility is the small and backward farmers who own a maximum of 5 acres of non-irrigated land or 2.50 acres of irrigated land including land to be purchased.
- Sharecroppers and tenant cultivators up to 2.50 acres of irrigated land or 5 acres of non-irrigated land including land purchased.
- Agribusiness people who do not own agricultural land but have an agricultural background are eligible to obtain purchase agricultural land loan, provided the relevant state laws permit, non-farmers to purchase agricultural land.
- Farmers remain in the category of small farmers those are 5 acres of non-irrigated land or 2.50 acres irrigated land even after purchasing the proposed land.
The margin will be at least 20%.
Since bank-financed land is a basic guarantee, the mortgage on the land purchased should be considered regardless of the loan amount. In addition, the mortgage on the land currently owned is used as security. The loan amount should not be more than the current land value and also the proposed land to be purchased.
The loan is to be repaid in half-yearly/annual installments over a maximum period of 10 years, including a maximum suspension period of 24 months.
Forms and documents
Deed of Guarantee, Letter of Continuity, Agreement of Hypothesis, Declaration / Undertaking for Agricultural Advance, Mortgage Agreement, General Lane and Set-Off Letter to disclose the contract, and any other document stipulated in sanction.
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