• Buying agricultural land

Hello:

Can a overseas citizen of Indian origin buy agricultural land/coffee estate in karnataka for setup of educational institution for commercial purpose. 
 i am planning to incorporate a company/business for this future school and wants to buy agricultural land ?

What is the best course of action in this case ?
Asked 7 years ago in Property Law
Religion: Hindu

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6 Answers

If you incorporate a company then the company is a legal person of India and it can surely buy agricultural land.

Such land being used for some other purpose is also possible but before that such land needs to be converted from its status.

That can be done by procedures laid down by the local BDO/Panchayet/corporation.

Saptarshi Banerjee
Advocate, Kolkata
220 Answers
6 Consultations

4.5 on 5.0

1. There is no restrictions to buy such land for the purpose of setting up an institution by a company.

2. SO NRI can become one of its Directors but majority share in the company can not be hold by you.

3. You can have many of your family members though who are Indian citizens for holding majority shares in the company.

4. So form a company.

Devajyoti Barman
Advocate, Kolkata
22920 Answers
497 Consultations

5.0 on 5.0

NRIs and PIOs also cannot buy agricultural land in Karnataka.

2) RBI’s approval is mandatory and it would not be easily available

3) Section 109 of karnataka land reforms act says certain land can be exempted from the provisions of the act for the purposes of industry and horticulture, and for educational institutions, places of worship and housing projects.

Any company wanting to buy farm land has to go through the high-power committee before approaching the cabinet.

Ajay Sethi
Advocate, Mumbai
95198 Answers
7607 Consultations

5.0 on 5.0

Tourism , hotels would fall within definition of industry

2) the objective of restriction is to prevent diversion of agricultural land for non agricultural purposes hence number of restrictions are imposed

3) agricultural income is tax free and many individuals purchase agricultural land for investment purposes

4) even if land is sought to be acquired for industry no industrial units are set up

5) hence proposal for purchase of land has to be vetted throughly before permission is given

Ajay Sethi
Advocate, Mumbai
95198 Answers
7607 Consultations

5.0 on 5.0

Can a overseas citizen of Indian origin buy agricultural land/coffee estate in karnataka for setup of educational institution for commercial purpose.

i am planning to incorporate a company/business for this future school and wants to buy agricultural land ?

An OCI cannot buy agricultural land anywhere in India.

NRIs (Non Resident Indians), PIOs (Persons of Indian Origin), OCI holders (Overseas Citizens of India) or even Indian citizens with hard cash may be tempted to invest in lush farmlands or plantation properties in Karnataka, India.

Reason - the produce from agricultural land, or the rental income by leasing out such land to a farmer or income from house constructed on such a land, is totally tax free.

Such verdant lands are also exempted from wealth tax; a tax that is, by and large, levied on benefits that accrue from any owned property.

There are some stringent restrictions imposed upon by the central and the state governments on buyers locally and abroad, even on those of Indian origin.

No agricultural land can be legally purchased by foreigners in Karnataka. In fact this rule is uniformly applicable all over India. No Indian state permits foreign nationals to buy farmlands.

2. NRIs and PIOs also cannot buy agricultural land in Karnataka. Same rule applies all over India. RBI’s approval is mandatory and it will surely not be easily attainable.

Even if the apex Indian bank allows the same, it would largely depend on individual circumstances.

T Kalaiselvan
Advocate, Vellore
85398 Answers
2235 Consultations

5.0 on 5.0

Notwithstanding anything contained in sub-section (1), the State Government may in public interest and for reasons to be recorded in writing, [by notification and subject to the provisions of the Karnataka Town and

Country Planning Act, 1961 (Karnataka Act 11 of 1963) and such restrictions and conditions as may be specified by it, exempt any extent of land from the provisions of sections 63, 79A, 79B or 80]4 for any specific purpose.

[Provided that [the Deputy Commissioner other than the Deputy Commissioner of Bangalore Rural District and the Deputy Commissioner of Bangalore District, may]6 subject to the restrictions and the manner specified in this sub- section exercise the power of the State Government to grant exemptions to an extent not exceeding half hectare of land.]

T Kalaiselvan
Advocate, Vellore
85398 Answers
2235 Consultations

5.0 on 5.0

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