Buying agricultural land in India: what to check first

Farmland looks simple to buy: a field, a seller, a price per acre. In practice it is one of the most rule-heavy purchases in India, because agricultural land is regulated by each state’s land laws. Whether you can buy at all, what you can do with the land, and what tax and duty apply all depend on where it is. This guide covers the checks that matter most.

Can you buy it?

Some states limit who may buy agricultural land. A few allow only people who are already agriculturists in the state, or require permission from the revenue authorities for others. Himachal Pradesh, for example, restricts purchases by non-agriculturists, and Maharashtra and Gujarat have rules that favour agriculturists. Some other states have relaxed their restrictions over the years; Karnataka did so in 2020. Because laws change, ask a local lawyer or the revenue office whether you can buy the specific land you are looking at, and what permission, if any, is needed.

Who else cannot buy

Non-resident Indians (NRIs) and overseas citizens of India (OCIs) are generally not allowed to buy agricultural land, plantations or farmhouses in India, though they can inherit them. Foreign nationals living abroad have even tighter limits. If this affects you, read our guide on NRI and OCI buyers.

What “agricultural” really means for use

Land classified as agricultural can usually be used for farming and related activity only. If you want to build a house, a resort, a warehouse or a layout, the land normally has to be converted to a non-agricultural use by the competent authority, and conversion has a fee and conditions. Never assume you can build because you bought the land. Ask for the conversion order if one exists, or find out whether conversion is possible and what it costs before you pay.

Land ceilings and holdings

States also limit the amount of agricultural land one person or family can hold. Ask whether your purchase, together with what you already own, could cross the ceiling in that state.

Check the records

Everything in our document checklist applies, with a few extras for farmland:

Measure and demarcate

Revenue records often give area in hectares or local units, and sometimes the boundaries have moved over the years. Ask for a survey and demarcation by the government surveyor, and walk the boundary with the seller and neighbours. Our guide to bigha and katha explains why local units are risky to rely on.

Practical checks on the ground

Money matters

Stamp duty and registration still apply, and rates for agricultural land can differ from residential property. Tax on the sale of rural agricultural land is treated differently from other property, and the rule that asks buyers to deduct tax at source on larger purchases generally does not apply to rural agricultural land. Because tax rules change, ask a professional about your own situation. The total-cost checklist shows the other charges to budget for.

A short checklist

  1. Confirm that you are allowed to buy in that state.
  2. Collect and verify the title and revenue records.
  3. Check co-owners, tenants, loans and cases.
  4. Get the land surveyed and demarcated.
  5. Verify legal access and water.
  6. Ask about conversion and what you may build.
  7. Register the deed and update the revenue record in your name.

The Rules and Laws and Buying Guide sections in Plotwise cover farmland as one of the property types. They are guides only, so confirm everything locally.

General information only, not legal advice. Land laws differ by state and change.