In a judgment that is seen as a setback to the realty sector in Hyderabad, the high court on 28th August made it clear that those who wish to convert agricultural land into non-agricultural one have to pay a conversion fee and obtain clearance from the respective revenue divisional officer (RDO) under the AP Agricultural Land (Conversion for non-agricultural purposes) Act, 2006.
Several developers and land owners had approached the high court challenging the applicability of the 2006 Act on grounds that they are already paying fees for conversion, development charges, apart from impact fee permission fee to develop land. This additional requirement for obtaining permissions and fee would burden them further.
Earlier, a single judge upheld the provisions of the 2006 Act, but carved out an exception for those who had already converted their land into a non-agricultural one prior to 2006. Aggrieved at this order, the developers preferred an appeal before the division bench comprising acting Chief Justice Dilip B Bhosale and Justice SV Bhatt. However, this bench too agreed with the single judge, dismissed all the appeals on 28th August and upheld the provisions of the 2006 Act. The bench said that just because development fee is paid to the local body, the developers cannot say they need not take permission for conversion of agricultural land for non-agricultural purposes like construction of buildings.
Now the urban development authorities, or the local authorities, as the case may be, can insist on submission of clearance/permission under the 2006 Act as a condition for releasing of layouts. The permission will be granted after payment of fee to the concerned RDO as per schedule. MV Durga Prasad, the counsel for one of the developers, said they would challenge this order in Supreme Court. Pointing out that land value is high in and around Hyderabad; he said a steep five to nine per cent of the value has to be paid to the competent authority for obtaining permission under this 2006 Act.