A Legal Analysis Of The Maharashtra Land Revenue Code (Second Amendment) Act, 2025

Introduction and Background

The State of Maharashtra has introduced a major reform in land laws through the Maharashtra Land Revenue Code, 1966 (Second Amendment) Act, 2025, focusing on restructuring non-agricultural land conversion. The amendment simplifies the process of converting agricultural land to non-agricultural (NA) use, reduces repetitive taxation, and shortens procedural delays. Previously, land conversion involved a complex, multi-layered system with multiple approvals, recurring financial obligations, and overlapping municipal and revenue permissions. The reform transitions from this control-based framework to a single premium model, treating land conversion as a one-time regulatory process rather than a recurring taxable event, while protecting existing legal rights.

Earlier Approach: Multi-Layered Permissions

Under the previous system, agricultural land required the Collector’s permission under Section 42 even if it was designated for non-agricultural use in a Development Plan under the Maharashtra Regional and Town Planning Act, 1966. Landowners had to navigate multiple procedural steps like application scrutiny, fees, issuance of a Sanad, updating land records and pay conversion tax, annual NA assessment, and municipal development charges. Although “deemed conversion” existed in planning areas, compliance still required formal approvals from revenue authorities, making the process redundant and burdensome.

Removal of Separate Collector Permission

The amended Section 42 eliminates the requirement for separate Collector permission when land use aligns with a Draft or Final Development Plan or Regional Plan. Planning Authorities can now directly grant development permission or approve building plans, creating a single-window system that reduces administrative delays, particularly in urban and semi-urban areas.

Occupancy Status

The amendment clarifies that granting development permission does not automatically change a land’s legal classification or occupancy status, except for Class-I occupancy lands. Existing landholding rights remain intact unless explicitly modified, protecting landowners from unintended legal consequences.

Introduction of One-Time Premium (Section 47)

Section 47 replaces the earlier system of conversion tax and annual NA assessment with a one-time premium calculated on the land’s market value, as per the Ready Reckoner. Rates are progressive: up to 1000 sq. m.-0.1%, 1000–4000 sq. m.-0.25%, and above 4000 sq. m.-0.5%. Past conversions are regularized based on the applicable market value at the time. This replaces recurring obligations with a single predictable payment, enhancing transparency and ease of compliance.

Deletion of Redundant Provisions and Updating Revenue Records

Several sections, including 42A-42D, 44-46, 47A, parts of Chapter VII, and clauses in 67, 125, and 328, have been deleted to remove outdated procedures and prevent conflicts with the new system. Revenue records, previously updated only after issuance of a Sanad, are now automatically revised once development permission is granted and the premium paid, ensuring accurate and timely reflection of land use changes.

Conclusion

The Maharashtra Land Revenue Code (Second Amendment) Act, 2025, modernizes land governance by removing redundant approvals, introducing a one-time premium, streamlining record updates, and integrating planning approvals. It enhances transparency, efficiency, and ease of development while safeguarding existing legal rights. Further clarifications for unplanned areas are expected to strengthen its effectiveness in transforming land conversion processes in Maharashtra.