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Introduction
The Maharashtra Land Revenue Code (Second Amendment) Act, 2026 (L. A. BILL No. XXVIII OF 2026) represents a significant reform in the regulation of government land transactions in Maharashtra. Introduced in the Maharashtra Legislative Assembly on 24th March 2026, it focuses primarily on amending Section 37A of the Maharashtra Land Revenue Code, 1966, a provision that governs the sale, transfer, redevelopment, use of additional Floor Space Index (“FSI”), transfer of Transferable Development Rights (“TDR”), and change in use of government land.
The amendment carries important implications for land administration, regulatory flexibility, and the regularization of past transactions.
Background of the Law
The Maharashtra Land Revenue Code, 1966 (“MLRC”) serves as the principal legislation governing land administration in Maharashtra, including land ownership, usage, transfer, and revenue collection. Over time, the MLRC has been amended to respond to changing administrative, economic, and urban development needs.
In 2012, Section 37A was introduced into the MLRC to regulate government land transactions, mandating that any sale, transfer, redevelopment, use of additional FSI, TDR or change in land use shall require prior permission from the State Government.
However, prior to the introduction of Section 37A of the MLRC, the State Government exercised its authority under Section 40 of the MLRC and the Maharashtra Land Revenue (Disposal of Government Land) Rules, 1971, to dispose of and regularize land transactions through executive orders and resolutions. These often involved the collection of premiums, nazrana, or a share of unearned income.
While the intent was to strengthen oversight and prevent the misuse of government land, practical challenges emerged during implementation, particularly concerning transactions that had occurred without prior permission.
1 Key Provisions of the 2026 Amendment
The 2026 Bill introduces two principal changes to Section 37A:
1.1 Substitution of “Prior Permission” with “Approval”
The amendment replaces the term “prior permission” with “approval” in Section 37A. Though seemingly minor, this change reflects a substantive shift in regulatory approach. “Permission” implies a requirement before an action is taken, whereas “approval” allows for validation either before or after a transaction.
This modification introduces greater flexibility into the regulatory framework, enabling the authorities and the government to handle land transactions, especially those that may not have strictly followed procedural requirements in the past.
1.2 Validation of Past Transactions
A key addition is the insertion of a proviso validating certain past transactions involving government land. According to this amendment, transactions shall be deemed valid if:
They were approved by the Government through a resolution or general/special order,
- Payments such as premium, nazrana, or unearned income were collected, and
- The approval was granted prior to the commencement of the earlier amendment.
This provision addresses a longstanding administrative issue where numerous transactions could not be regularized due to procedural non-compliance.
2. Rationale and Objectives
The amendment seeks to address administrative inefficiencies and legal ambiguities:
2.1 Administrative Challenges: Authorities encountered difficulties in regularizing land transactions where prior permission had not been obtained, even though the government had otherwise approved or benefited from them.
2.2 Historical Practices: Before the introduction of Section 37A, the government routinely disposed of land and regularized transactions under Section 40 of MLRC and the rules framed thereunder. These practices included the issuance of government resolutions and collection of charges.
2.3 Need for Legal Clarity: The absence of explicit provisions to validate such transactions created legal ambiguity, affecting both government administration and stakeholders.
By addressing these issues, the amendment aims to align legal provisions with administrative realities.
3. Implications of the Amendment
3.1 Regularization of Irregular Transactions - One of the most immediate impacts of the amendment is the ability to regularize past transactions that lacked formal prior permission but were otherwise processed and approved by the government, particularly in urban areas where redevelopment and land-use changes are common.
3.2 Increased Administrative Flexibility - The shift from “permission” to “approval” allows authorities to handle cases more pragmatically, reducing delays and improving efficiency in land governance and approvals.
3.3 Legal Certainty - The amendment provides legal backing to previously uncertain transactions, reducing litigation risk and enhancing confidence for stakeholders in government land dealings.
3.4 Revenue Considerations - By validating such transactions, the amendment ensures that government revenue already collected is not jeopardized due to procedural technicalities.
4. Potential Concerns and Criticism
While the amendment offers practical benefits, it may also raise certain concerns:
4.1 Risk of Encouraging Non-Compliance - Critics may argue that allowing post-facto approvals could weaken the incentive to follow proper procedures. If stakeholders believe that non-compliance can later be regularized, it might undermine regulatory discipline.
4.2 Transparency Issues - There may be concerns about whether all approvals especially retrospective ones are granted transparently and consistently. Clear guidelines and accountability mechanisms will be essential to address this.
4.3 Scope for Discretion - The increased reliance on government “approval” could expand administrative discretion. Without proper safeguards, this may lead to inconsistent decision-making or potential misuse.
4.4 Balancing Reform and Regulation - The amendment reflects a broader challenge in governance balancing strict regulatory frameworks with the need for flexibility and practicality. Land administration, especially in a rapidly urbanizing state like Maharashtra, often involves complex realities that rigid rules may not fully accommodate.
By introducing this amendment, the government appears to be acknowledging these complexities and attempting to create a more adaptable legal framework. However, the success of this approach will depend on how effectively it is implemented.
5 Reform Cycle
5.1 The 2026 amendment must be understood within a broader legislative reform cycle. The Maharashtra Land Revenue Code (Second Amendment) Act, 2025 marked a structural shift in land administration by replacing prior Non-Agricultural (“NA”) permission with automatic alignment to sanctioned Development Plans and introducing a one-time premium in place of recurring NA assessment.
5.2 Subsequently, the Maharashtra Land Revenue Code (Amendment) Act, 2026 (L.C. Bill No. II of 2026), introduced in the Legislative Council on 4th March 2026, expanded the reform trajectory. It enabled the use of urban Gairan land for public infrastructure, subject to State approval, and introduced electronic service of notices to improve administrative efficiency.
5.3 Read together with the Maharashtra Land Revenue Code (Second Amendment) Act, 2026, these reforms reflect a clear transition from a permission-based regime to one grounded in plan-alignment, administrative efficiency, and legal certainty. However, the shift also places greater responsibility on planning authorities, raising concerns about institutional capacity and uniform implementation across the State.
Our Analysis
The Maharashtra Land Revenue Code (Second Amendment) Act, 2026 reflects a calibrated shift from a strictly procedural, permission-based regime to a more flexible, approval-oriented framework. By permitting retrospective validation of specified government land transactions and refining procedural requirements, the amendment addresses longstanding administrative constraints and aligns the statutory framework with established governmental practices.
However, the introduction of an approval-based mechanism also broadens the scope of administrative discretion and necessitates careful oversight. The effectiveness of this reform will therefore hinge on the State’s ability to ensure that such discretion is exercised within a transparent, consistent, and accountable framework, to preserve procedural integrity and prevent potential misuse.
Ultimately, the amendment is not just a technical change but a reflection of evolving governance priorities in managing, Land as a key economic and regulatory asset in Maharashtra.
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