• Can a private company lease agricultural land in Karnataka?

Dear Sir/Madam

I want to enquire if a private limited company can take on lease agricultural land in the state of Karnataka. The company plans to make investments in modern technology to improve the productivity of the farm. The land will not be used for non-agricultural purposes. Is this possible? If so, please guide me to the relevant section of the law? Are there any conditions to be kept in mind?
Asked 2 years ago in Property Law from Bengaluru, Karnataka
Religion: Hindu
1) Section 109 of the karnataka and reforms act Act confers power on the State Government to grant exemption in regard to a land in any area from the provisions of Sections 63, 79A, 79B and 80 of the Act to be used for industrial purposes, educational institutions, places of worship, a housing project or horticulture including floriculture or an agro based industry. Further, the Government has also the power even in the absence of such purposes to grant exemption in public interest.

2) Karnataka land reforms Amendment bill 2015 passed by state legislature empowers deputy commissioners in districts to double the area of land that can be acquired by non-agriculturists for industrial, educational, religious, housing and horticulture purposes from the existing 20, 4, 1, 10 and 20 units, respectively.

3) RULE38-D. Application for grant of exemption.— 
(1) Every application for exemption under Section 109 shall be made in Form 15-A along with a Court fee of rupees five to the concerned Deputy Commissioner. 
2)2) Immediately on receipt of the application the Deputy Commissioner shall cause it to be entered in a separate register maintained for each of the category depending on the extent of land sought to be exempted and the purpose for which exemption is sought. [He shall scrutinize the application in Form 15-A and the documents received from the applicant and fill up Form 15-AA] and after following the procedure specified in Rule 38-B, forward the application to the Government.
Ajay Sethi
Advocate, Mumbai
45421 Answers
2668 Consultations

5.0 on 5.0

1. Under the Companies Act, a company which is registered may perform those activities that are listed in the Objects ,Articles and the memorandum. By virtue of its objects and articles, as registered under the companies act, the P.Ltd can function and perform agricultural activities and need not be a agriculturist as in the case of an individual person. 

2. In Karnataka the govt recently exempted only 6 companies from acquiring agricultural land. No company, except the six specific companies mentioned in the notification, qualify to acquire land as a lessee or purchaser.
Ashish Davessar
Advocate, Jaipur
22977 Answers
634 Consultations

5.0 on 5.0

The State government has decided to amend the Karnataka Land Reforms Act, 1974, to allow farmers to lease out their agricultural land to private agro companies, who in turn will have to use technology to increase yield on the leased land.

The proposal was recently cleared by the State Cabinet and an amendment bill will be tabled in the next legislature session. The new business model, termed ‘management contract’, was first mooted at Global Agribusiness and Food Processing Summit last year.

At present, the Karnataka Land Reforms Act - 1974 bars leasing out agricultural land. 

Once the amendments are in place, farmers can lease out their land to agro companies for a specified period. Cultivation and harvest of the farm produce will have to be taken up by the private players. At the same time, agro companies entering into the lease will have to utilise value added services in agriculture such as hi-tech cultivation and precision farming to increase the yield on the leased land. On their part, farmers will retain the ownership of land through the agreement period and can also seek fixed rent for the land holding.
T Kalaiselvan
Advocate, Vellore
35580 Answers
385 Consultations

5.0 on 5.0

Section 79A of the Karnataka Land Reforms Act 1961 provides agriculture business by a registered company. Agricultural land can be used only for agricultural purposes and no other purposes. Utilising agricultural land for any other purpose is prohibited by law. you require to registered a company other than section 8 company, file an affidavit regarding survey numbers of lands. Get tippani of all lands, RTC and NOC from tehsildar. 
Shivendra Pratap Singh
Advocate, Lucknow
5066 Answers
78 Consultations

4.9 on 5.0

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