345. Land conversion - Agricultural land converted to residential in India

Q. Dear Sir, Can an NRI (US citizen) with a PIO Card buy a 'converted' agricultural land? Converted to 'residential' and I have documentation to back it. Do you foresee any problems with it?? Thanks in Advance. Damodar Reddy Bellevue, WA A. NRIs can buy residential or commercial properties without any problems. As long as the land is designated as residential when you purchase it, I don't foresee any problem. I am not sure where in India you are planning to buy the land that has been converted as residential land from agricultural land. However a few things I would like to mention. While each State would have their own set of rules, and I am not sure where the land is that you refer to in your question. Sometimes there is a time limit to take advantage of the conversion grant. There is also the possibility that the converted land may not be legally transferred. For instance in Rajasthan:  I believe that unless the purpose for which the land is converted is not carried out in two years the permission is canceled and the land reverts back to agricultural. Use of land after conversion - Any agricultural land, converted for a non agricultural purpose, shall be used for such converted purpose within a period of two years from the date of issue of the conversion order failing which the conversion order shall be withdrawn and the amount of premium deposited shall be forfeited to the State Government. [Provided that the said period of two years may be extended by one year by the next higher authority, if such higher authority is satisfied.] Provided further that an opportunity of being heard shall be given before passing an order of forfeiture of the premium. Agricultural land that is converted to residential may not be transferred for two years after conversion is granted. Transfer of Land converted for Non-Agricultural purpose - Any land, duly converted for any non-agricultural purpose under these Rules [Shall not be transferred within two years of such conversion, after two years such land] may be transferred without payment of premium or obtaining permission from the prescribed authority. ["Provided that transfer of the land may be made by way of lease or mortgage for the purpose of obtaining loan from the State Government or Land Development Bank as defined in the Rajasthan Cooperative Societies Act, 1965 (Act 13 of 1965) or a Cooperative Society registered or deemed to be registered as such vide said that or any scheduled Bank or Rajasthan Finance Corporation, Rajasthan State Industrial Development and Investment Corporation Limited or any other initiative notified by the State Government in that behalf.   Since you have the documents confirming conversion from agricultural to residential land, check them carefully to see if there are any strings attached to selling the land. When land is converted, a purpose is given by the land owner for the conversion by filling an application form and submitting proof of land ownership. When buying converted land, the buyer should ask for all documents such as copies of the original application made to convert the land from agricultural to residential. The appropriate response from the conversion authorities etc. Personally, I would not take documentation received from India at face value, get it checked by a lawyer. Land registration documents, ownership etc. should be confirmed from the appropriate offices in India.
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