Summary: The blog discusses the Maharashtra Land Revenue Code (Second Amendment) Act, 2025 which marks a significant shift in land governance. It simplifies procedures for conversion to non‑agricultural use and reduces regulatory approvals, where such use is permitted under planning laws. By streamlining permissions and introducing a one‑time premium model in lieu of recurring non‑agricultural assessment, the amendment seeks to accelerate development while modernising revenue administration.

The Maharashtra Land Revenue Code (Second Amendment) Act, 2025, introduced on December 8, 2025, and assented to by the Governor on December 31, 2025 (“Amendment Act”), marks a major reform in land conversion administration and has been enacted to modify the Maharashtra Land Revenue Code, 1966 (“Code”). It streamlines the process of converting agricultural land to non‑agricultural by eliminating the long-drawn process of obtaining Collector’s permission, sanad, abolishing conversion tax and annual non‑agricultural assessment, and introducing a new ‘one‑time premium’ for conversion of the land use to non-agricultural. These changes effectively remove dual taxation, reduce bureaucratic delays, and simplify procedures for landowners and developers.

The Core Reform: Eliminating the Collector’s Role

The centrepiece of the Amendment Act is the complete substitution of Section 42 of the Code, which previously required landowners to obtain the Collector’s permission before converting agricultural land for non-agricultural purposes. Under the new provision, this requirement for Collector’s approval has been eliminated, provided such non-agricultural use is permissible under the draft or final Development or Regional Plan under the Maharashtra Regional and Town Planning Act, 1966 (“MRTP Act”), or Development Control Regulations or any other regulations issued under the MRTP Act. Planning authorities now possess exclusive authority to grant development permissions and approve building plans, thereby creating a genuine single-window clearance mechanism.   

Abolishing the Sanad Requirement & Integration with Layout and Building Plan Approvals:

Although Sections 42A, 42B, 42C, and 42D of the Code (known collectively as the “Deemed Conversion Provisions”), established an “automatic” or “deemed conversion” mechanism for areas covered by Development Plans and Regional Plans, among other areas, this conversion remained conditional upon a multi-step administrative process. Occupants were required to submit applications to the Collector for assessment of conversion tax, non-agricultural assessment, nazarana or premium, and other Government dues applicable to both Class-I and Class-II occupant lands. Following such payments, the Collector would issue a sanad to the applicant, after which the conversion to non-agricultural use would be formally recorded in the Record of Rights. In practical terms, occupants remained dependent on the revenue authority throughout the conversion process from filing applications for tax assessments, undergoing official scrutiny, remitting payments, and securing a sanad from the Collector — before the conversion could be officially registered in the Record of Rights.

The Amendment Act removes the Deemed Conversion Provisions, which failed to deliver genuine automaticity and perpetuated landowners’ dependence on revenue authorities. Under the revised framework, non-agricultural conversion is incorporated directly into the development approval mechanism, guaranteeing automatic updation of revenue records and eliminating the Collector’s involvement. To ensure legislative coherence, the Amendment Act also repeals associated provisions — namely Sections 44, 44A, 45, 46, 47A of the Code, which previously regulated conversion procedures, permissions for bona fide industrial use, and penalties for unauthorised land use and payment of conversion tax.

However, it is pertinent to note that deletion of the Deemed Provisions does not do away with the conditionalities attached to the occupancy status of land. Particularly, the new Section 42 of the Amendment Act, stipulates that the occupancy status of land, other than Class-I occupancy, shall not be altered merely because development permission is given, ensuring that whilst conversion is simplified, underlying land tenure classification remains intact.

The New One-Time Premium Regime

Another remarkable reform in the Amendment Act is that it replaces the complex web of conversion tax, non-agricultural assessment, nazarana, and other charges payable for obtaining the conversion by introducing the concept of ‘one-time premium’. The amendment to Section 47 of the Code provides for premium at rates based on the market value of land, as per Annual Statement of Rates[1], varying by land area:

The Amendment Act does not distinguish between rates based on Occupants Class I land andother classes of occupancy land and has thus standardised rates, depending on the area of the land and not the occupancy nature of the land.

The new Section 47, however, clarifies, for land converted on or before December 31, 2001, the premium would be calculated using 2001 rates and for land converted between January 1, 2002, and the commencement date of the Amendment Act (i.e. December 31, 2025), the one‑time premium will be charged based on the land’s market value (commensurate with its area bracket, as aforesaid), as per the Annual Statement of Rates for the year in which the land was converted for non-agricultural use. The Amendment Act also clarifies that the State Government may also grant exemptions (by notification in the Official Gazette) for projects of public purpose or public interest

Practical Insight & Conclusion

The Amendment Act constitutes a substantial reform of land administration procedures under the Code, modernising Maharashtra’s land revenue framework to facilitate more streamlined, expeditious, and transparent processes for land conversion and development, whilst maintaining equitable revenue collection. For landowners contending with conversion permissions, businesses impeded by procedural uncertainties, and citizens subjected to arbitrary assessments, this Amendment Act delivers tangible relief by significantly reducing approval timescales, providing greater predictability through standardised rates and offering rates and exemptions for qualifying projects.

The Amendment Act represents a paradigm shift from a permission-based to a notification-based system, wherein development permission itself constitutes evidence of conversion. If implemented effectively, this reform has the potential to fundamentally transform land revenue administration from a barrier to development into a catalyst for progress.

[1] the Annual Statement of Rates published under the provisions of the Maharashtra Stamp (Determination of True Market Value of Property) Rules, 1995 or any other Rules for the time being in force in this regard.