Agricultural land: who can buy it and what to check

The short answer

Land is a state subject, so who may buy agricultural land is decided by state laws, and they differ sharply. Some states bar or restrict purchase by people who are not agriculturists; others have relaxed those rules. Separately, under India's foreign exchange rules, non-resident Indians (NRIs) and Overseas Citizens of India (OCIs) cannot buy agricultural land, plantation property or a farmhouse, though they can inherit it.

Even where you are allowed to buy, you can use agricultural land only for agriculture until it is converted to non-agricultural use with the permission or deemed permission the state law provides. And the land record, not the seller's word, tells you who owns it, what it is classified as, and whether it carries tenancy or other claims.

This guide sets out the general picture with checked examples from several states. Before any purchase, read your state's current law and take advice from a local lawyer; this is the area of property law where state differences matter most.

States that restrict non-agriculturists

Maharashtra: section 63 of the Maharashtra Tenancy and Agricultural Lands Act, 1948 bars the sale, gift, exchange or lease of agricultural land to a non-agriculturist without the permission of the Collector or other authorised officer. Section 63-1A provides exceptions, such as for bona fide industrial use. In practice buyers are often asked to show that they, or their family, already hold agricultural land in the state.

Gujarat: section 63 of the Gujarat Tenancy and Agricultural Lands Act, 1948 similarly restricts transfer of agricultural land to a person who is not an agriculturist, with section 63AA allowing purchase for bona fide industrial purposes on conditions.

Himachal Pradesh: section 118 of the Himachal Pradesh Tenancy and Land Reforms Act, 1972 restricts the transfer of land to non-agriculturists — including Himachalis who are not agriculturists — without the state government's permission, granted for stated purposes.

Other states have their own rules, including ceilings on how much land a family may hold. Ask a local lawyer to confirm both the eligibility and the ceiling before you pay any advance.

States that have relaxed the rules: Karnataka

Karnataka removed sections 79A, 79B and 79C of the Karnataka Land Reforms Act, 1961 in 2020, first by ordinance and then by an amending Act. Those sections had barred people with high non-agricultural income, and institutions such as companies and trusts, from buying agricultural land. Since the 2020 amendment, non-agriculturists may buy agricultural land in Karnataka.

In September 2024 the state government announced an intention to restore those sections. Reports checked on 2 October 2026 did not show that the restoration had been enacted, but this is precisely the kind of rule that can change, so confirm the current position before buying.

NRIs and OCIs

Under the Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, an NRI or an OCI cannot acquire agricultural land, plantation property or a farmhouse in India by purchase. Any exception needs specific approval, which is not routinely given.

They can inherit such property from a person who held it lawfully, and can hold inherited agricultural land. Selling it, and taking the proceeds abroad, has its own conditions; take advice under the current rules before a sale.

A common workaround — buying through a resident relative's name with the NRI's money — creates a benami and title risk and is not recommended. Our NRI guide covers what NRIs can buy.

Conversion to non-agricultural use

Building a house, a warehouse, a school or a resort on agricultural land generally requires conversion (non-agricultural or 'NA' permission, or change of land use, CLU). The conversion order, the conversion charge receipt and the corresponding change in the land record are part of the title you should ask for when buying land described as 'converted'.

States have been simplifying this. In Maharashtra, sections 42B, 42C and 42D of the Maharashtra Land Revenue Code, 1966, inserted in 2017 and 2018, provide for deemed conversion in areas covered by a final development plan or regional plan, subject to payment of conversion tax and other dues. Karnataka amended section 95 of its Land Revenue Act in 2025 to simplify conversion, with draft rules issued on 17 September 2025.

Deemed conversion still requires paying the conversion charges and getting the record updated. A plot sold as 'NA' without a conversion order or a corresponding record entry should be treated as unconverted.

Land record checks before you buy

Get the current record of rights for the survey number — called the 7/12 in Maharashtra, RTC in Karnataka, khatauni in Uttar Pradesh, jamabandi in several northern states, and other names elsewhere. Check the owner's name, the area, the land classification, and any entries for tenancy, government restriction, mortgage or dispute.

Read the mutation history to see how the seller acquired the land, and check each step against registered deeds. Remember that a mutation entry is for fiscal purposes and is not proof of title.

Get the survey map and have the land measured on the ground by a licensed surveyor. Boundary and area mismatches are among the most common disputes in farmland.

Check whether the land is in a restricted category — assigned or granted land, land under a land ceiling order, tribal land, forest or eco-sensitive land, or land notified for acquisition. Many of these carry transfer bans or need government permission.

Take an encumbrance certificate from the sub-registrar for at least thirty years, and search for court cases on the survey number.

Buying farmland, step by step

Step 1: confirm eligibility. Ask a local lawyer whether, under the state's tenancy or land reforms law, you may buy agricultural land, whether you need prior permission, and what landholding ceiling applies to your family. If you need to prove you are an agriculturist, collect the record of rights of land you or your family already hold in the state.

Step 2: pull the records. Get the current record of rights, the mutation history, the survey map and an encumbrance certificate, and run the checks in the previous section.

Step 3: walk and measure the land. Hire a licensed surveyor to fix the boundaries against the survey map, and talk to neighbours about access, water rights and any boundary disputes.

Step 4: sign an agreement to sell that makes the sale conditional on permission (where needed), clear title and, if you plan non-agricultural use, conversion. Keep the advance modest until those conditions are met.

Step 5: register the sale deed at the sub-registrar's office, paying stamp duty on the higher of the price and the circle rate, then apply for mutation so the record of rights shows your name.

Taxes and costs to plan for

Stamp duty and registration fees apply to agricultural land as to any other immovable property, at the state's rates. The TDS provision for property purchases does not apply to agricultural land, and rural agricultural land as defined in the Income-tax Act is not a capital asset for capital gains purposes. The definition depends on distance from municipal limits and population, so confirm the classification before relying on it.

Budget for the conversion charge if you plan non-agricultural use, the surveyor's fee, legal fees for title search and any permission fees for purchase by a non-agriculturist.

Common mistakes and questions to ask

Buying in a state that restricts non-agriculturists without first confirming your eligibility. In several states a sale made in breach can be declared invalid, and the land can be forfeited to the state.

Paying for 'converted' land without a conversion order. Buying on the strength of a mutation entry alone. Ignoring tenancy entries in the record.

Questions to ask: Am I eligible to buy agricultural land in this state? Is the land within any ceiling limit for my family? What is the classification in the record, and is the land in a restricted category? Is there a conversion order, and was the record updated? Does the measured area match the record?

Common questions

Sources

• Maharashtra Tenancy and Agricultural Lands Act, 1948, sections 63 and 63-1A; Maharashtra Land Revenue Code, 1966, sections 42B to 42D (indiacode.nic.in; indiankanoon.org); checked 2 October 2026
• Gujarat Tenancy and Agricultural Lands Act, 1948, sections 63 and 63AA; Himachal Pradesh Tenancy and Land Reforms Act, 1972, section 118; checked 2 October 2026
• Karnataka Land Reforms (Amendment) Act, 2020 omitting sections 79A to 79C (analyses by Bar and Bench and Khaitan & Co); reports of the 2024 restoration announcement (The Wire); Karnataka Land Revenue Act section 95 amendments, 2025; checked 2 October 2026
• Foreign Exchange Management (Non-Debt Instruments) Rules, 2019 — restrictions on NRI and OCI acquisition of agricultural land, plantation property and farmhouses; checked 2 October 2026
• Income-tax Act, 2025, section 393(1) (TDS on immovable property other than agricultural land); checked 2 October 2026

Last checked 2026-10-02.