CHAPTER IV

LAND REVENUE

4.1 Tax Administration

The administration of Land Revenue Department vests with the Principal
Secretary, Revenue Department. For the purpose of administration, the State
has been divided into six divisions and each division is headed by the
Divisional Commissioner who is assisted by District Collectors. There are 36
District Collectors, 121 revenue sub divisions, 358 Tahsils headed by the
Tahsildars. The Revenue Inspector and Village Officers (Talathi) are
responsible at the grass root level for collecting the land revenue and dues
recoverable as arrears of land revenue.

4.2 Results of audit

In 2016-17, test check of the records of 86 units of the Land Revenue, showed
Non levy/short levy of Occupancy Price, Lease Rent, Unearned income, non
levy of Non-Agriculture Assessment etc. and other irregularities amounting to
` 187.92 crore in 251 observations, which fall under the categories given
below in Table 4.2.
Table 4.2
` in crore)
(`
Sr. No. Category No. of Amount
observations

1 Performance Audit of “Encroachment on 1 0.00

Government land for non-agricultural
purposes”
2 Audit of “Management of Nazul Lands in 1 85.90
Vidarbha Region”
3 Non levy/short levy of measurement fees, 5 17.17
sanad fees, license fee etc.
4 Non levy/short levy of fine, non- 45 14.21
auction/short recovery of surface rent on
account of sand ghats, royalty etc.
5 Non levy/short levy/incorrect levy of Non- 48 5.99
Agriculture Assessment (NAA), ZP/VP
cess and conversion tax.
6 Non levy/short levy of occupancy price, 63 44.83
lease rent, unearned income etc.
7 Other irregularities 88 19.82
Total 251 187.92

In response to our observations made in the local audit reports during the year
2016-17 as well as during earlier years, the Department accepted and
recovered under assessments/other deficiencies involving ` 192.52 crore in

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443 observations, out of which five observations involving ` 30.12 lakh were
pointed out during 2016-17 and the rest during earlier years.
A few illustrative cases involving ` 87.69 crore including a performance audit
on “Encroachment on Government land for non-agricultural purposes” are
discussed in the succeeding paragraphs.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

4.3 Performance Audit on “Encroachment on Government land

for non-agricultural purposes”
Performance Audit on “Encroachment on Government land for non-
agricultural purposes” revealed the following:
The Government did not maintain any database of the Government land in the
State and also data of the encroachment on government land was not available
at District and Tahsil level. The data prepared under the Maharajaswa
Abhiyan was not reliable. There were discrepancies in data recorded at various
levels. Encroachment register were not properly maintained. No action was
taken for eviction of encroachment. No periodical survey was conducted by
Circle Officers for identification of encroachment.
• Cross verification by Audit of encroachment registers in 416 test
checked villages with property cards and other records in the Tehsil
indicated that encroachments had taken place in 77 villages which
were not included in the registers.
(Paragraph 4.3.1.1)
• Niphad Tahsil of Nasik District consisted of 135 villages. The
Tahsildar reported 582 cases of encroachments in the Tahsil. The
village level Encroachment Registers showed 1,270 cases of
encroachments on Government land in 55 villages selected for test
check. The encroachments could be more if encroachment cases in all
the 135 villages were considered.
(Paragraph 4.3.1.3)
Government land measuring 67,490.20 sqm of Lendi Talab (pond), a water
body in Mouza Nagpur Khas was encroached with the construction of 1,200 to
1,500 houses.
In Thane city, a lake existed 30 to 35 years ago and now a slum comprising
300 to 350 houses had grown up and remaining open land was used for
parking vehicles.
(Paragraph 4.3.2.2)
Encroachment on Government land in respect of brick kilns in three Tahsils
was 1,74,421.71 sqm.
(Paragraph 4.3.2.3)
No action for eviction of encroachment was taken even after noticing it. In
Thane District, Government land was transferred to Municipal Corporations
(MC) for protection against encroachment. However, it did not serve the
purpose as cases of encroachment by MC itself were noticed on the transferred
land. The encroachment on grazing land was not removed as Revenue
Department passed on the responsibility to concerned Local bodies.
• Audit noticed that Government land reserved (September 2010) in
District Plan for public purpose like playground, parks, cremation
ground, roads etc., in the custody of Municipal Corporations (MC) in
Thane District was encroached.
(Paragraph 4.3.2.5)

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• Unauthorised transfer of leased land by manipulating document and

encroachment was noticed in village Waladgaon of Aurangabad
Tahsil. The land was allotted on lease for touring talkies purpose and
the lessee sold the leased land.
(Paragraph 4.3.2.6)
The monitoring by the Department was weak on account of (i) absence of
periodical reports for keeping a check over encroachment, (ii) lack of
efforts to obtain data/information on Government land and (iii) laxity of
the Department in taking penal action against encroachers.

• Scrutiny of records revealed that a road included in Development Plan

of Nagpur city was encroached for residential purposes. There was no
co-ordination between the Government and NMC to ensure the
eviction of the encroachments made.
(Paragraph 4.3.2.7)
• Information furnished by Tahsildars of test-checked Tahsils revealed
that in 102 villages of nine Tahsils 507.87 ha of grazing land was
encroached and had not been evicted and handed over to Gram
Panchayat despite Supreme Court orders..
(Paragraph 4.3.2.8)
• The records of allotment of Government land were test checked at
District Collector/Tahsil offices. The cases of breach of terms and
conditions of allotment was noticed in 13 cases involving area of
1,39,651 sqm.
The flats constructed on the Government land allotted to a society of
218 members of tribal community for residential purposes were
unauthorisedly transferred to persons other than the 218 members
(Paragraph 4.3.3)

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Audit Report for the year ended 31 March 2017 on Revenue Sector

Introduction
The management of Government land is governed by the provisions of
Maharashtra Land Revenue (MLR) Code 1966 and Disposal of Government
Land Rules, 1971 made thereunder. As per Section 53 of MLR the
Government land held by any occupant by way of encroachment or trespass is
called unauthorised occupation and any person occupying any land after
expiry of the period of lease or tenancy or termination of the lease or tenancy
or breach of any conditions annexed to the tenure respectively is also a
unauthorized occupant. Sections 50, 51, 52 of the MLR Code deal with the
removal, regularization, fixation of value of land and eviction from the
encroached land respectively. The state Government had from time to time
issued Government resolutions/instructions for regularisation of the
encroached land. This regularisation is subject to the terms and conditions
mentioned in each resolution.
The Government of Maharashtra, Revenue and Forest Department had
initiated (August 2015 and continued thereafter) a drive, Maharajaswa
Abhiyan for smooth functioning of revenue Department which inter alia
included identification and eviction of encroachments on Government land.

Organisational setup

REVENUE AND FOREST DEPARTMENT

DIVISIONAL COMMISSIONER

DISTRICT COLLECTOR

SUB DIVISIONAL OFFICER

TAHSILDAR

Audit Objectives
The audit was conducted with the view to ascertain that
(i) a proper mechanism existed in the Department for identification,
eviction and regularization of encroached land;
(ii) the land revenue records of the encroachment cases were maintained
properly;
(iii) and adequate and effective monitoring controls existed in the state for
safeguarding the Government land.

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Audit Criteria
The audit criteria for performance audit were derived from the provisions of
the following Acts and Rules/notifications issued there under:
(i) Maharashtra Land Revenue Code, 1966,
(ii) Maharashtra Land Revenue (Disposal of Government Land) Rules,
1971,
(iii) Maharashtra Land Revenue Circle Officers and Circle Inspectors
(Duties and Functions) Rules, 1970.
(iv) Government resolution and circulars issued from time to time.

Scope and methodology of Audit

The Performance Audit was conducted between January 2017 and June 2017
covering the period from 2011-12 to 2015-16.
The State is divided into six revenue divisions. Of these, audit test checked the
records of six Districts1 (one from each division having highest population),
two Tahsils from each selected District and records related with the
regularization of encroachments at Mantralaya. 7/12 extracts/Property cards2
of Government lands were also checked on random basis at Tahsil level. The
encroachment cases pertaining to periods prior to March 2011 were also
scrutinized during the audit. Leads of probable areas of encroachment of land
were also gathered from Google Earth application. The findings appearing in
this report on the basis of this application were got confirmed by the
Department.
An Entry Conference was held in February 2017 with the Principal Secretary,
Revenue and Forest Department (RFD) in which the objectives, scope and
methodology of audit were explained. The audit findings were reported to the
Government in July 2017. An Exit Conference was held in September 2017
with the Principal Secretary, RFD in which the audit findings were discussed
in detail. The replies received during the exit conference and at other points of
time have been appropriately incorporated in the relevant paragraphs.

1
Amravati (Amravati & Morshi), Aurangabad (Aurangabad & Paithan), Nagpur (Nagpur &
Hingna), Nasik (Nasik & Niphad), Pune (Pune & Haveli) and Thane (Thane & Kalyan).
2
The 7/12 extract is an extract from the land register maintained by the revenue Department
of the Government of Maharashtra, a state in India. The extract gives information of the
survey number of the land, the name of the owner of the land and its cultivator, the area of
the land, the type of cultivation - whether irrigated or rain fed, the crops planted in the last
cultivating season. A property card provides information about the ownership of a property
and history of holdings of a land located in urban area.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

Audit findings
Audit noticed a number of system and compliance deficiencies during the
performance audit in regulations and identification of cases of encroachments
at various levels. These are briefly discussed as follows:

4.3.1 Maintenance of records and identification of encroachments

4.3.1.1 Maintenance and submission of Encroachment register
The Land Revenue Rule book provides for maintenance of a register at village
level in form number 1-E (Encroachment Register). Information regarding
survey number of land, name of the encroachers, area of encroachment and
date on which encroachment was noticed, period from which land was
encroached and assessment to be recovered from the year is required to be
entered in the Encroachment Register. This was required to be maintained by
Talathi3. The register was required to be submitted to Tahsildar, who was
responsible for taking action under the Maharashtra Land Revenue Code
(MLR Code) against encroachers.
Audit scrutinised the Encroachment Registers of 416 villages out of 1,457
villages in twelve test-checked Tahsils. Out of these, in 204 villages the
registers were maintained but were incomplete. The essential information like
area/description of land encroached, date of encroachment, purpose of
encroachment, etc. were not recorded in the registers. In the registers of the
203 villages the Department had reported nil encroachment. In the remaining 9
villages entries made in encroachment register were correctly filled. In 337
villages the encroachment registers had not been submitted by Talathi to
Tahsildar. This indicated that the Department failed to maintain the records
properly and keep a vigil on encroachment cases. In absence of records the
total number of encroachments could not be ascertained.
Cross verification of these registers with the records at Tahsil level like 7/12
abstract/property cards, complaint cases etc. and leads from Google Earth
application revealed encroachments in 77 villages which were not recorded in
the registers though the encroachments had taken place in the villages. These
are discussed in the respective paragraphs.
Manipulation of encroachment registers: The Sub Divisional Officer (SDO)
had received complaints against the deliberate entries of encroachment made
in encroachment registers of three villages4 of Thane Tahsil. On investigation
it was found that the period and the name of Talathi who inserted entries were
not on record. Therefore, the entries were cancelled by SDO and the registers
were kept in the custody of Tahsil office and were not maintained in those
villages.
Further, in four villages5 of Thane Tahsil, serial numbers of the encroachment
registers were changed by inserting entries in between the existing numbers.
These cases were pointed out by audit; action taken has not been intimated.

3
Revenue officer at Village level under Tahsildar.
4
Agasan, Dativali and Sabe.
5
Balkum, Kalwa, Maziwade and Uttan.

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Since, the date of encroachment is an important factor while regularising

encroachment, its manipulation in the records is fraught with the risk of
granting benefits to the unintended persons. The above facts indicate that there
was need not only for ensuring the proper maintenance of records but also for
its regular submission to the higher authorities so that its correctness was
ensured and monitoring done properly.
In exit conference (September 2017), Principal Secretary stated that the
practice of recording encroachments in encroachment register (1-E) was
apparently discontinued apprehending it would create record for claiming
rights on Government lands and would serve as direct evidence of physical
possession in any legal proceeding. The reply was not in consonance with the
provisions of the MLR Code. It is recommended that the records may be
maintained in a proper manner so that the process of removal, eviction or
regularisation is timely taken by the Department.
4.3.1.2 Inspection by Circle Officers
Rule 17 of the Maharashtra Land Revenue Circle Officers and Circle
Inspectors (Duties and Functions) Rules, 1970 read with Revenue and Forest
Department’s circular of February 1969 provided that the Circle Officer
should certify every year that he had inspected all Government lands and that
there were no encroachments thereon and in case of encroachment, he had to
report it to his superior officer (Tahsildar).
The records produced to audit indicated that inspection for identification of
encroached land were not made by any Circle Officers in the test checked
Tahsils. The Principal Secretary accepted (September 2017) audit contention
and stated that it was expected to conduct inspection of Government lands in
the Maharajaswa Abhiyan (Abhiyan). However, inspection certificate was not
insisted upon. Now a certificate for the inspection conducted would also be
obtained from respective Circle officers.
The fact however remained that the Department had not followed the existing
system and as a result, it had to rely on the Abhiyan. The system prescribed in
MLR Code needs to be followed irrespective of any other efforts made by the
Government.
4.3.1.3 Accuracy of the encroachment data available in District, Tahsil
and Village levels
One of the major components of Maharajaswa Abhiyan (Abhiyan) was
identification and eviction of encroachments on Government land. A monthly
return indicating the cases of encroachments were required to be reported to
the District Collectors by Tahsildars. The reports were consolidated at District
level and submitted to the Government under the Abhiyan.
Audit cross checked the monthly returns submitted by the six District
Collectors to the RFD with the Encroachment Registers (1-E) maintained by
416 villages. The discrepancies noticed between the two are discussed below.
(i) Niphad Tahsil of Nasik District consisted of 135 villages. The
Tahsildar reported 582 cases of encroachments in the Tahsil. The village level
Encroachment Registers showed 1,270 cases of encroachments on

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Audit Report for the year ended 31 March 2017 on Revenue Sector

Government land in 55 villages selected for test check. The encroachments

could be more if encroachment cases in all the 135 villages considered.
(ii) In Hingna Tahsil (134 villages) of Nagpur District, monthly returns of
December 2015 and January 2016 were at variance. The monthly return of
December 2015 showed the opening balance as on 31 July 2015 as nil while
the monthly return of January 2016 showed the opening balance as on 31 July
2015 as 16. All these 16 cases were shown as evicted. The figures were at
variance again with the Encroachment Register maintained with the Tahsil
which indicated that 1,701 encroachment cases in Encroachment Registers of
three6 villages only out of 134 villages in the Tahsil. The encroachments
could be more if encroachment cases in all the villages of Tahsil were
considered.
(iii) Records revealed that Tahsildar, Nasik had reported 86 encroachment
cases in monthly return of February 2016. However, District Collector, Nasik
while consolidating the monthly return for the month depicted only 29
encroachment cases against Nasik Tahsil.
The mismatch between the two sets of information needed to be reviewed and
rectified. It may be ensured that correct information is submitted to the
Government through these monthly returns.
The Principal Secretary accepted the facts and stated (September 2017) that
the data in Abhiyan was only a numerical representation of encroachment
cases while details of individual encroachment cases were recorded in 1-E
register. He further stated that necessary instructions would be issued to ensure
that number of encroachment cases was compiled correctly at Tahsil, District
and Government levels.
4.3.1.4 Absence of central database for Government Land and
encroachment thereof
The RFD circular of February 1982 stipulated that it would be the
responsibility of the concerned District Collectors that no new encroachments
came up on any open land. The new encroachments were to be immediately
removed in accordance with the provisions of the law.
Audit observed that the Government had not maintained any data base either
electronically or manually at Tahsil, District or Government level for
Government land. The information was compiled Tahsil wise manually by
District Collector, Nasik. The format adopted did not contain the full
details/information of the encroached land as critical information like date
from which land had been encroached, number of encroachers etc. was not
found entered.
Compilation of data under Abhiyan was also found defective as the
discrepancies between the figures at various levels were noticed and discussed
in Paragraph 4.3.1.3.
The Principal Secretary accepted the facts and stated (September 2017) that
steps had been taken under Abhiyan for preparation of a comprehensive
database of Government lands.

6
Vagdara, Vanadongari and Savangi villages in Hingna Tahsil of Nagpur District.

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Thus, the Department had not made any serious effort for having an accurate
and updated data for the entire state so that removal of the encroachments
could be planned in a systematic, transparent and time bound manner.
4.3.2 Action against encroachment
Section 53 (1) of the MLR Code, 1966 provided that if in the opinion of the
Collector any person is unauthorisedly occupying or wrongfully in possession
of any land vesting in the State Government, it shall be lawful for the
Collector to evict such person. In absence of a reliable encroachment data at
District and Tahsil levels, audit could not ascertain the total quantum of
encroachments in the State. Similarly, performance of RFD in taking effective
action against encroachments could not be ascertained.
As per Section 50 (2) and (4) of MLR Code if encroached land was used for
non-agricultural purposes, fine not exceeding ` 2,000 was leviable and in
addition penalty at the discretion of Collector, not exceeding ` 50 per day
during any portion of which the encroachment continued after the date fixed
for the notice to take effect.
As discussed in Paragraph 4.3.1.1 regarding discontinuation of recordings of
encroachment cases in the Encroachment Registers and absence of central
database for Government land and encroachment thereon (Paragraph 4.3.1.4)
audit could not ascertain the extent of encroachment. Audit randomly checked
the records like 7/12 abstract, files of complaint cases etc. at district and Tahsil
level and cross verified with records with City Survey Office. Audit found
encroachments were made for commercial and other activities and these are
discussed in the following paragraphs.
4.3.2.1 Encroachment of Government land for commercial purposes
Records of District Superintendent of Land Records, Nagpur (DSLR)
revealed that mutation of land admeasuring 1,552.04 sqm occupied by the
Orange City Hospital (OCH) since January 2000 was cancelled by an
order of DSLR in December 2005. The ownership of the land was
transferred to the Government in the records. However, the land in
question was not got evicted. A City Survey Office investigation in 2014
revealed that the land belonged to Government. On this, OCH filed
(April 2014) an appeal case before the appellate authority DSLR which
was dismissed in April 2017. There was nothing on record to indicate that
stay orders for eviction of the land were granted by any investigating
appellate authority between February 2014 and April 2017. The
Department also did not make any effort to get the land vacated which
continued to remain in the illegal occupation of the OCH for the last 17
years. The value of the land as per Annual Statement of Rates amounts to
` 9 crore. For illegal occupation of the land, non-agricultural cess and fine
of ` 3.587 lakh would have been recovered had the notices been issued to
OCH.
In exit conference (September 2017), Principal Secretary stated that the
District Collector, Nagpur would verify the factual status of the land.

7
Fine: ` 2,000 + (365 days x ` 50 x 17 years) = ` 3,12,250 and NA cess : 1,552.04 sq.m x
1.74 x 17 years = ` 45,900 Total = ` 3,58,150 (` 3,12,250 + ` 45,900) say ` 3.58 lakh.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

As per the property cards, land bearing city survey numbers 1051, 1053,
1054, 1056 and 1057 in Paithan belonged to the Government. Shops
having area of 8,000 sqm were constructed (2015) on this land by Nagar
Parishad, Paithan. The Revenue Department did not take any action till
the receipt (October 2015) of a complaint addressed to the District
Collector, Aurangabad who instituted an enquiry. The result of enquiry
was not produced to audit. In March 2017, a proposal for regularisation of
illegal encroachment was forwarded by District Collector, Aurangabad to
Secretary, Urban Development Department, response on which was yet
awaited.
Thus, RFD was not keeping a keen vigil on the Government land and
remained unaware of the facts till buildings were constructed by the
Nagar Parishad Paithan. In exit conference (September 2017), Principal
Secretary stated that the District Collector’s proposal to regularize the
encroachment would be examined in terms of applicable laws.
4.3.2.2 Encroachment on water bodies8
As per survey done (April 2013) by City Survey Officer-I, (CSO) Nagpur,
Government land admeasuring 67,490.20 sqm of Lendi Talab (pond), a
water body in Mouza Nagpur Khas was encroached with the construction
of 1,200 to 1,500 houses. A list of 368 encroachers was furnished by the
CSO to audit. Analysis of the information of 368 cases furnished by CSO
revealed that the 36 number of encroachments were made during the
period from 2005 to 2017. The exact area of the pond was not available
with the Department (January 2017). The Assistant Commissioner and
Ward officer, Nagpur Municipal Corporation (NMC) had advised the
Tahsildar, Nagpur (July 2015) for taking action in and around
encroachment of Lendi Talab as the land belonged to State Government
and also offered encroachment removal squad of NMC. No action for
eviction of encroachment has so far been taken. The need for urgent action
to protect the water body is evident from the Google Earth pictures of
2005 and 2017 (Annexure-I) which clearly indicate large encroachment
during the last twelve years. The Department had not kept any record of
the encroachments. Hence, loss on account of non-levy of fine and non-
agriculture cess could not be worked out by audit.
In exit conference (September 2017), Principal Secretary noted the fact
and stated that necessary direction would be issued to District Collector,
Nagpur to effectively co-ordinate with NMC for removal of encroachment.
As per the certified (DSLR Thane) map of village Panchpakhari in Thane
city, a water body (lake) existed adjacent to survey number 106a and 107.
The concerned Tahsildar informed audit (June 2017) that a lake existed 30
to 35 years ago and now a slum comprising 300 to 350 houses had grown
up and remaining open land was used for parking vehicles. The
encroachment register was not made available to audit to confirm the
extent of encroachment. This indicated inaction on the part of authorities
in taking timely action to evict the encroachment.

8
A body of water forming a physiographical feature, for example a sea or a reservoir.

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In exit conference (September 2017), Principal Secretary noted the fact

and stated that necessary directions would be issued to District Collector,
Thane to effectively co-ordinate with Thane Municipal Corporation for
removal of encroachment.
4.3.2.3 Encroachment for mining and allied activities
It was noticed that no data of encroachment on Government land in respect
of brick kilns existed in the test checked units. However on being asked
by audit it was collected and furnished by two Tahsils9 to audit. Audit
took input/lead from Google Earth application and found possibilities of
encroachment on account of brick kilns in Paithan and near the river
Kadwa, Niphad (Annexure-II).This was brought to the notice of
Department who accepted the facts of the encroachment in all the four
Tahsils. The total area encroached in three Tahsils, as furnished by the
concerned Tahils, was 1,74,421.71 sqm. The area of encroachment in
Niphad Tahsil was not furnished.
In exit conference (September 2017), Principal Secretary noted the fact
and stated that necessary direction would be issued to respective Collectors
for removal of encroachments. The Government may arrange drive for
identification and removal of encroachments.
It was seen that Tahsildar, Aurangabad had intimated the Maharashtra
State Electricity Distribution Company Limited (MSEDCL) for
disconnecting electric supply of 22 stone crushers located on Government
Land in five villages10 operating without payment of the royalty for the
year 2016-17. No effort was made to ascertain validity of permission to
operate these stone crushers.
Audit noticed that the Tahsildar, Aurangabad had not granted any
permission to these crushers for use of the Government land; they had
occupied the Government land without any authority. The encroachers
were also liable to pay fine and non-agricultural cess.
In exit conference (September 2017), Principal Secretary noted the facts
and stated that necessary directions would be issued to Collector,
Aurangabad for removal of encroachments.
4.3.2.4 Encroachment by Educational Institutions
(i) Records (Scrutiny of 7/12 abstract) revealed that land admeasuring
8.98 ha, bearing khasra number 87/1-2-3 of the village Jaitala, Nagpur
belonged to Government. The District Collector, Nagpur intimated (August
2017) that out of 8.98 ha, 4.60 ha was in possession of Roman Catholic
Diocese Education Institute. Nothing on record was found to indicate valid
permission for the said use of land. Tahsildar, Nagpur stated (January 2017)
that no land had been allotted from the said khasra number. This indicated that
the institute had encroached on 4.60 ha of the land.

9
Amravati and Aurangabad.
10
Aadgaon Bu, Ladsawangi, Naigaon, Sawangi and Tuljapur.

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In exit conference (September 2017), Principal Secretary noted the facts and
stated that necessary directions would be issued to District Collector, Nagpur
for removal of encroachment.
(ii) Records revealed that in Kannad village of Aurangabad District land
admeasuring 6.07 ha and 2.02 ha was allotted (July 1976) by District
Collector, Aurangabad on occupancy and lease right basis to Shri Chattrapati
Shikshan Prasarak Mandal, Kannad (Mandal) for constructing college, hostel
building and play ground respectively. Taluka Inspector of Land Records,
Kannad conducted (July 2016) measurement and found that the Mandal had
occupied excess land of 2.55 ha in addition to the land allotted to it. Out of
this, 2.33 ha was resumed by the Tahsildar but 0.22 ha of land on which the
college building was constructed could not be resumed. Neither notice for
eviction was issued nor any attempt made to regularise the same.
Further, the lease of the land for play ground allotted to the Mandal expired in
1991. The lease was not renewed till date and Mandal continued to hold the
land for its use which was unauthorized and needed eviction.
In exit conference (September 2017), Principal Secretary stated that since the
building was constructed on the encroached land and its removal would
hamper the education of students, the proposal to regularize the encroachment
would be explored in terms of applicable laws. In case of expiry of the lease of
play ground, proposal for renewal, if any, would be examined. Reply of the
Principal Secretary is not tenable because no action on unauthorised
occupation of the land allotted for play ground had been taken even after lapse
of 26 years of expiry of the lease
4.3.2.5 Encroachment of the Government land transferred to Municipal
Corporation
In September 2010, RFD decided to keep Government land reserved in
District Plan for public purpose like playground, parks, cremation ground,
roads etc., in the custody of Municipal Corporations (MC) in Thane District,
with the aim to keep it free from encroachment.
Accordingly, the District Collector, Thane transferred (2010 to 2015)
401.60 ha of land in various villages to three MCs11. In December 2015,
Tahsildar, Thane surveyed a sample of these lands and reported that the lands
had been partly encroached and were used by MCs for purposes other than
reserved one. Thus, the use of land by MCs was unlawful.
Audit noticed few instances of encroachments on the land transferred to MCs
which are mentioned in the following paragraph.
• In Kalwa village in Thane Tahsil, land admeasuring 15.91 ha
transferred to Thane Municipal Corporation (TMC), was reserved for
recreation ground. The Talathi, Thane Tahsil informed (June 2017)
that 7.56 ha land was used for hospital and Maharashtra State
Electricity Board’s office. Similarly, in village Kolshet, land
admeasuring 2.18 ha transferred to TMC had been encroached by
slum; in village Davle 0.75 ha land was transferred (2010) to TMC

11
Thane MC, Mira Bhayander MC and Kalyan Dombivali MC.

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after evicting residential encroachment on 185.80 sqm land, but the

encroacher had re-occupied it (October 2012).
In exit conference (September 2017), Principal Secretary stated that
Government could assign the responsibility of protection/maintenance of
Government land to local authorities. However, the purpose of use cannot be
changed without the permission of revenue authorities and it would be joint
responsibility of local and revenue authorities to safeguard the Government
land. He further stated that instruction would be issued to conduct the survey
of these lands under the Maharajaswa Abhiyan.
The fact remained that the Government was not in a position to protect its land
and was keeping it in the custody of MCs for protecting it from encroachments
though there were well defined rules in the MLR Code for protection of the
Government land. Besides it had not developed any system to ensure that the
land was in safe custody. As a result, the land was encroached upon.
4.3.2.6 Unauthorised transfer of leased land by manipulating document
and encroachment thereof
Scrutiny of records (7/12 abstract and records of mutation) maintained by
Tahsildar, Aurangabad revealed that as per mutation entry no. 603
(02/06/1993) land admeasuring 2,000 sqm bearing Gut No. 175 in village
Waladgaon of Aurangabad Tahsil was allotted on lease for touring talkies
purpose. The mutation entry was made on the basis of allotment order shown
as issued on May 1993. Copy of allotment order was not on records with the
District Collector, Aurangabad to ascertain the lease period.
In the correspondence file, two letters were available, one issued (March
1988) by the District Collector, Aurangabad for allotment of land on lease for
99 years and the other (February 1995) mentioning no necessity of taking
permission of revenue authorities for mortgaging land.
District Collector, Aurangabad received a copy of lease order (lease period of
99 years) from Bank of Maharashtra, which was not found to have been issued
by his office. He referred (December 2000) the letter to State Examiner of
Documents, Aurangabad (SED) along with sample signature of concerned
official for checking its authenticity. SED certified (2001) that signature of the
official on first letter did not match with the sample signatures provided by the
Department. The result of investigation in case of second letter was not on
record. Tahsildar, Aurangabad ordered (May 2008) the Circle Officer for
enquiry in the case as the lessee transferred the land to various persons on the
basis of the letter showing lease period of land for 99 years. The Circle Officer
intimated (June 2008) Tahsildar, Aurangabad that lessee had sold land to
various persons.
The District Collector, Aurangabad intimated (August 2015) to Divisional
Commissioner, Aurangabad that an enquiry was conducted in the case and
ordered (August 2015) Tahsildar, Aurangabad to restore land in the name of
Government. No action for restoration of land was taken (October 2017) nor
case was registered with the police against the lessee for submitting
manipulated document. In exit conference, Principal Secretary stated that
necessary instructions would be issued to the District Collector, Aurangabad
for action and filing first information report in the matter.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

4.3.2.7 Encroachment on the road included in Development Plan

Scrutiny of the records (development plan of Nagpur city) at Nagpur
Municipal Corporation (NMC) and image of the area on Google Earth
application (Annexure-III) revealed that a road included in Development Plan
of Nagpur city was encroached for residential purposes. After this was pointed
out by audit, Tahsildar, Nagpur confirmed the facts and stated that
encroachment on road was dealt by NMC. The NMC replied (August 2017)
that the road situated on the land belonged to Government hence issue
regarding road was not in its purview. This indicated that there was no co-
ordination between the Government and NMC. Thus Government land was
fraught with the risk of more encroachments in absence of timely action by
Government.
In exit conference (September 2017), Principal Secretary stated that both
revenue and local authorities were responsible for protection of Government
land. There should be co-ordination between these for removal of
encroachment if any.
4.3.2.8 Encroachment on grazing land
To protect grazing land from encroachments, Supreme Court in its judgment
had issued (January 2011) orders that the land under administrative control of
Gram Panchyat (GP)/Nagar Panchayat (NP) should be kept free from
encroachment by all the State Governments and be handed over to the GP for
public usage. The Supreme Court further instructed that the State Government
should ensure strict and prompt compliance with the court order and submit
compliance reports to the court from time to time. The RFD in July 2011
instructed GPs/NPs for conducting a special programme for eviction of
encroachments and protecting the land from further encroachments by taking
help of concerned Tahsildar, Public Works Department and Police
Department.
Information furnished by Tahsildars of test-checked Tahsils revealed that in
102 villages of nine Tahsils 507.87 ha of grazing land was encroached and had
not been evicted and handed over to GP. There was nothing on record to
indicate that compliance was submitted to Supreme Court.
As per information obtained from nine Tahsils the area of grazing land and
encroachment thereon is mentioned in Table No 4.3.2.8.

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Table No 4.3.2.8 : Grazing land and encroachment thereon

Sl. No. Name of the Tahsil Number of Area of the grazing land
villages encroached (in Hectare)
1 Nashik 9 12.82
2 Niphad 28 79.54
3 Aurangabad 1 0.92
4 Paithan 5 26.11
5 Haveli 7 4.45
6 Pune City 2 12.56
7 Hingna 0 0
8 Thane 21 132.42
9 Kalyan 29 239.05
Total 102 507.87
Source: Information furnished by respective Tahsildar

Two Tahsils12 had not prepared information of grazing land and encroachment
thereupon and information in respect of Tahsil Nagpur was awaited.
A few other cases of encroachment of grazing land are mentioned as follows:
(i) In village Dehu in Pimpri Chinchwad Tahsil, grazing land admeasuring
10 ha was allotted (1993) on lease of 30 years on annual lease rent of one
rupee to the Mahatma Gandhi Smarak Nidhi, Kothrud for plantation purposes.
Later, it was intimated by the Circle Officer (November 2010) that the land
was not being utilised by the lessee and it has been encroached by 288 slum
dwellers. The land was resumed in September 2014 and 33 huts were
removed. However, as of October 2016, the number of encroached huts went
up to 406. No action for eviction of encroachment was taken except notices
issued to the encroachers.
(ii) In village Kharabwadi in Tahsil Khed instead of evicting
encroachment, the proposal for regularization of encroachment for residential
purposes on grazing land admeasuring 344.64 sqm was sent (November 2013)
to RFD by the Divisional Commissioner, Pune. Further progress in this case
was not intimated. The proposal sent was in principle against the orders of the
Supreme Court.
In exit conference (September 2017), Principal Secretary noted the fact and
stated that both revenue and local authorities were responsible for protection
of grazing land and agreed to issue instructions to the District Collectors and
GPs for coordinating with each other for evicting encroachment on grazing
land.

4.3.3 Unauthorised retention of Government land after allotment

RFD clarified in its GR dated 22 January 2002 that it was the responsibility of
the District Collectors to verify whether the allottee/lessee of Government land
had adhered to the conditions of the allotment/lease. In case of breach of terms

12
Amravati and Morshi.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

and conditions action against the allottee/lessee was required to be taken as per
Section 53 of MLR Code. This included eviction of encroachment on land
unauthorisedly occupied by persons.
In five Districts i.e. Aurangabad, Amravati, Nagpur, Pune and Thane details of
expired leases were not furnished. Therefore audit could not ascertain the
actual status of the leases and action taken against the lessee under Section 53
of the MLR code.
Audit scrutinized cases of breach of conditions of land allotment produced by
the Department at District/Tahsil level. The cases of breach of terms and
conditions of allotment were noticed in 13 cases wherein action in terms of
Section 53 was not taken. Four of these cases are discussed in the following
paragraphs and the remaining nine cases are briefly discussed in table no.
4.3.3.2(ii).
4.3.3.1 Irregular transfer of land
i) RFD vide GR dated 09 May 1980 had sanctioned 74,400 sqm of land
having survey number 35 and 36 situated in mouza Warje, Tahsil Haveli, Pune
for society of nomadic tribes. Out of this, RFD allotted (2008) 17,650 sqm
land of survey number 35 to Ramnagar Co-Operative Housing Society
(RCHS) for residential purpose to 218 members of nomadic tribe on following
terms and conditions:
(a) the eligibility of the members was to be verified in terms of Social
Welfare, Cultural Affairs and Sports and Special Assistant Department
GR dated 01 April 1998. District Collector after verification was
required to issue formal orders of grant of land to the society members.
(b) the land shall not be transferred or mortgaged without prior approval
from the Government
(c) the land allotted shall be used for the sanctioned purpose only. It shall
not used for other purpose without approval from the Government.
The Special District Social Welfare Officer, Pune (SDSWO) forwarded
(29 August 2008) a list of 218 members of the RCHS to the District Collector,
Pune wherein it was verified that the 218 members belonged to nomadic tribe.
District Collector was required to declare the eligibility of members for land
grant. However, there was nothing on records to indicate that any action was
taken on the list forwarded by SDSWO. Audit further observed that Chairman,
RCHS had executed (November 2009) a development agreement with
Sidharth properties. District Collector, Pune informed audit that flats were
transferred to persons other than the 218 members as verified by SDSWO. As
such Chairman, RCHS breached the conditions of allotment of land and
nothing on records was found to indicate that District Collector monitored the
adherence to terms and conditions of allotment of land even when
constructions was under progress or at the time of transfer of flats.
Thus, the objective of granting land for residence of 218 nomadic tribe
beneficiaries remained unachieved and Government land worth ` 24.66 crore
was illegally exploited by the Chairman, RCHS against whom no action for
violation of allotment conditions was taken.

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In exit conference (September 2017), Principal Secretary agreed to issue

directions to District Collector, Pune for taking stern action against the
responsible persons and for ensuring protection of the right of 218 members.
ii) Land admeasuring 40,000 sqm in village Khedshivapur, Tahsil Haveli
was allotted (1984) to Dnyan Probodhini Sanstha (Sanstha) for the purpose of
construction of technical and industrial training institute for its students and
for playground. Sanstha sold (2008) 4,250 sqm of this land to M/s. Red Shop
Manufacture Limited who again sold it to Meto Tak Paper Company without
any permission of the competent authority and some part of building of
institute was rented to third person. No action to resume the land was taken
despite repeated violations/breaches of terms and condition of allotment of
land.
In exit conference (September 2017), Principal Secretary stated that details
would be obtained from Collector, Pune and appropriate action taken.
4.3.3.2 Irregular use of land
i) In Yerwada village of Pune District, land admeasuring 1.60 ha was
allotted (September 1992) to Pune Municipal Corporation (PMC) on lease for
15 years (till 2007) for play ground. There was nothing on records to show
that the lessee applied for renewal of lease. Out of 1.60 ha, PMC sub-leased
(April 2000) 0.80 ha land to C-DAC without permission of revenue
authorities. C-DAC did not use the land and RFD directed (November 2011)
District Collector, Pune to restore land to the Government and recover lease
amount of ` 72.06 lakh paid by the C-DAC to PMC. However, land was still
in possession of PMC and an amount of ` 72.06 lakh was not recovered.
Further, as per Panchnama report (inspection conducted by Talathi Yerwada,
Pune in October 2016), a statue was erected by encroaching on the land. The
District Collector, Pune in his report (November 2016) to Divisional
Commissioner, Pune stated that a building having swimming pool, gymnasium
and watchman room existed on the remaining part of land admeasuring
0.80 ha. The ownership of the building was not available on the records. As
such the land admeasuring 1.60 ha including the land of 0.80 ha leased to C-
DAC was not restored and no action for eviction of encroachments on the land
admeasuring 0.80 ha was taken.
In exit conference (September 2017), Principal Secretary agreed to issue
directions to District Collector, Pune for taking action for erecting of statue on
the land which was restored and also agreed to address the issue of
construction of swimming pool and gymnasium by the PMC on the balance
land.
ii) RFD had regularised (July 1974) the encroachment and unauthorised
construction by the Wagheshwar V.K.S.S Sanstha (Society) in Village
Wagholi, of Tahsil Haveli on the land admeasuring 217 sqm subject to the
condition that the society shall use the land for Godown and office building
only. The Society constructed a three storied building comprising 20 shops
and 10 lodging units on 900 sqm of land by encroaching on 683 sqm
(900-217) Government land. Thus, apart from unauthorised construction and
breach of condition, additional encroachment was made by the society. No

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Audit Report for the year ended 31 March 2017 on Revenue Sector

action has been taken by Tahsildar for eviction of encroachment on 900 sqm
of land valued at ` 90 lakh.
District Collector, Pune informed that notice was served on the concerned
society in February 2017 in response to which, the society filed appeal no.
RCS 629/2017 in civil court. The status of the case would be verified and
accordingly action to restore the land would be taken. In exit conference
(September 2017), Principal Secretary agreed to issue instructions to the
District Collector, Pune for early settlement of case.
Audit also observed nine cases of breach of terms and conditions of allotment
of land in five13 out of 12 test-checked Tahsils. In these cases 65,101 sqm of
land was occupied unauthorisedly, which should be treated as encroachment.
Action of either resuming of land to Government or regularisation by levy of
charges and penalty was to be taken. The details are given in Table 4.3.3.2 (ii)
Table 4.3.3.2 (ii): Cases showing breach of condition for allotment of land
Sr. Name of the Description of the Area of the land (sqm) Nature of breach
No. lessee/occupant Land and purpose of allotment
1 2 3 4 5
1 Shetkari CTS No. 1238, 286.20 sqm Land was used for
Sahkari Sangh, 1257 to 1262 As per Dy. Superintendent constructing shops
Nasik Village & Tahsil - of Land records, Niphad and renting them
Niphad, Nasik letter dated 20/01/2017 the out.
land was allotted for
godown.
2 Kanda Survey No. 40,000.00 sqm Land was sold to
Nirjalikaran 517/A/1/4 Village As per SDO, Niphad letter the Agriculture
Karkhana - Pimpalgaon dated 04/02/2017 the land Produce Market
Pimalgaon (B) Basvant, Tahsil - was allotted for drying Committee
Niphad, Nasik onion.
3 Shri. Pardeshi CTS No. 1050 1,045.50 sqm Land was used for
Somnath Paithan, The property card of survey construction of
Sitaram Aurangabad number 1050, Paithan Marriage hall.
showed land for touring
talkies.
4 Pune Club Survey No. 6 and 2,988.88 sqm Land (1,217 sqm)
6B Tahsil Pune As per Tahsildar Pune City was used for
City, Pune letter dated 09/06/2015 land commercial
was allotted for recreational purpose.
activities.
5 Rashtriya Survey 880.40 sqm Not used by the
Apang Vikas No.63/2B1/1 As per the District Sanstha itself, the
Sanstha, Pune Village Pravati Collector, Pune letter dated land was used by
Tahsil Pune City 13/06/2016 the land was the Alliance Club,
allotted for welfare of Pune
physically handicapped
person.

13
Haveli, Niphad, Nasik, Pune City and Paithan.

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1 2 3 4 5
6 Progressive Survey No.85/1B 10,000.00 sqm Land (242.02 sqm)
Education & 86/1/1 Village As per District Collector was sub-leased
Society, Pune Aundh Tahsil letter dated 16/05/2016 the (01/07/1991 to
Pune City land was allotted for 30/06/2011) to
educational purpose. Bank and stationery
shop
7 Rajgadh Dhanakwadi, 4,900.00 sqm Construction of a
Dyanpith Bhor, Haveli, Pune As per mutation register the three storey
Pune land was allotted for building which
educational purpose. included hotel,
beauty parlour and
shops on ground
floor.
8 Shiv Smarak Gat No.40 3,300.00 sqm In addition to the
Samiti, Pune Village As per District Collector, said purpose, land
Dhankawadi, Pune letter dated was also used for
Tahsil Haveli 16/09/1989 the land was 20 shops, marriage
allotted for cultural hall and hall, one College
hostel for students. and office.

9 Ramchandra CTS. No. 947, 1,700.00 sqm Operating Bar and

Jiwaji More Survey No.377/1 As per Additional Restaurant since
Village - Bhagoor, Collector letter dated last 20 to 25 years
Tahsil - Nasik 04/02/1960 the land was without any
allotted for stocking permission of
firewood, charcoal. revenue authorities.

In exit conference (September 2017), Principal Secretary agreed to issue

directions to concerned District Collectors for taking appropriate action in
these cases and also stated that a policy would be framed to address the issue.
The reply of the Principal Secretary may be viewed in the light of the fact that
the District Collectors took no action to evict the unauthorised occupants of
Government land despite statutory and administrative directives.

4.3.4 Monitoring of encroachment of Government land

RFD vide circular of May 1999, instructed that squad should be formed at
District level for identification and prevention of encroachment. It was also
instructed that District Collector, Sub-Divisional Officer and Tahsildar should
review the encroachment status in monthly meetings.
As per information furnished, out of six selected Districts, no squad for
identification or prevention of encroachment was formed in four
Districts14. In Pune District squad was formed but the report on action
taken was not made available to audit nor was it found on record. The
District Collector, Nagpur did not furnish information.
Further, monthly meetings to review the status of encroachment were
not being conducted in two Districts viz. Amravati and Nasik. In
remaining Districts, it was observed that monthly review meetings

14
Amravati, Aurangabad, Nasik and Thane.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

were taking place. District Collector, Nagpur did not furnish any
report.
It was also instructed (February 1987) by RFD that a six monthly
report should be submitted through District Collectors, containing
details of total Government land in Tahsil, number of encroachment on
the land, area of land encroached upon and land remaining vacant. No
such report was prepared in any of the six Districts and twelve Tahsils
test-checked.
RFD vide resolution of September 2010 and October 2013 directed
that details of the land in possession of local bodies and punishment for
its misuse should be displayed at the local Revenue Offices/Local
Bodies. In the all the test-checked Tahsils, notice board showing
details of Government land in Tahsil and mentioning punishment for
its misuse was not displayed.
RFD’s circular of May 1999 states that a police complaint should be
made against the encroacher of the Government land. In all the test-
checked Tahsils, no police complaints were lodged against the
encroachers and audit also did not notice instances in which police
complaints were lodged.
Thus, the monitoring by the Department was weak on account of (i) absence
of periodical reports for keeping a check over encroachment, (ii) lack of
efforts to obtain data/information on Government land and (iii) laxity of the
Department in taking penal action against encroachers.
In exit conference (September 2017), Principal Secretary accepted the
observations regarding internal control and stated that issue of formation of
squad, quarterly returns was addressed in the Maharajaswa Abhiyan with
effect from August 2015. He also agreed to issue instructions regarding
unavailability of returns at District Collectors and Tahsil level, display of
notice boards and lodging of police complaint against the encroachers.
The facts remained that squads were not formed (June 2017) in five test-
checked Districts and the returns submitted under Abhiyan were also not
reliable and incomplete.

4.3.5 Conclusion and Recommendations

The Government did not maintain the databank of the total open Government
land in the State and also data on encroachment on government land was not
available at District and Tahsil level. The data prepared under the
Maharajaswa Abhiyan was not reliable. There were discrepancies in
maintenance of encroachment register. No action was taken for eviction of
encroachment. No periodical survey was conducted by Circle Officers for
identification of encroachment.
Information of a Government land in given place and identification
of encroachment are two important aspects that need to be
addressed for effective action to deal with encroachment.
Accordingly a database should be prepared for the open
Government land and encroachment thereof, detailing name of the
encroachers, period of encroachment, area of encroachment and
action taken.

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No action for eviction of encroachment was taken even after noticing it. In
Thane District, Government land was transferred to Municipal Corporations
(MC) for protection against encroachment. However, it did not serve the
purpose as cases of encroachment by MC itself were noticed on the transferred
land. The encroachment on grazing land was not removed as Revenue
Department passed on the responsibility to concerned Local bodies.
A system should be devised for taking action against encroachment.
Government may issue directives that in case of land transferred to
local bodies, the responsibility to monitor encroachment and its
removal should remain with Revenue Authorities.
In cases of breach of condition of allotment of land on lease/occupancy right
basis, no action for restoration of land was taken; renewal of lease was not
done in case of allotment of land on leases. The system of monitoring the
encroachment was weak. Periodical reports were not submitted.
The Collector should verify the land allotted on lease and on expiry of
lease period it should be either renewed or the lessee evicted. In case
of occupancy right, Revenue Authorities should ensure that land is
being used for the purpose for which it was allotted. The dedicated
squad at District should be formed to monitor the Government land.
In exit conference (September 2017), Principal Secretary accepted the
recommendations regarding formation of database, strengthening the
mechanism prescribed for identification and reporting of encroachment and
devising system for timely action against encroachment. In case of
recommendations for issuing directives for land transfer to local bodies,
Principal Secretary suggested that the holder/assignee of the land should be
primarily responsible for protection of Government land and in case of its
failure, RFD would ensure protection of land. In case of mechanism for
corrective action against unauthorized retention of Government land for
specific purposes, he suggested that there should be a specific policy regarding
renewal of leases or otherwise.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

4.4 Audit of “Management of Nazul Lands in Vidarbha Region”

Introduction
Prior to independence, erstwhile Government of Central Province (CP) &
Berar and prior to formation of Maharashtra State (Maharashtra State was
formed in May 1960) the Government of Madhya Pradesh in Vidarbha15
Region of Maharashtra, allotted Nazul lands on lease subject to certain terms
and conditions to public for residential, commercial, educational and
charitable purposes. Nazul land means any type of Government land used for
non-agricultural purpose such as building, market, playground or any other
public purpose or the Nazul land which has potential for such use in future
including such lands granted on long or short term lease.
The renewal of lease was being done by fixing lease rent at three times the old
rent mentioned in the expired lease as per Government Resolution (GR) dated
January 1983, till June 2007.
The Government of Maharashtra framed a policy for renewal of leases,
regularisation of breach committed in lease conditions and other matters by
issue of GR dated June 2007 which inter-alia prescribed fixation of lease rent
based on the market value of property on renewal of leases. Thereafter the
lease rent was revised from time to time.
In March 2015, Government of Maharashtra vide Maharashtra Land Revenue
Code (Amendment) Act, 2012 inserted a provision, new Section 37A, in
Maharashtra Land Revenue Code, 1966 (MLRC) making a provision to levy
unearned income on sale/transfer of Government land. The sale/transfer of
Government land could only be made after prior approval of Government.
Prior to this the levy of lease rent and unearned income on sale/transfer of
Government land was done by issue of GRs.

Scope of audit
Audit was conducted during January to May 2017 covering leases renewed
from June 2007 to 31 March 2017. Audit selected five districts (Akola,
Amravati, Gondia, Nagpur and Wardha) having highest number of Nazul
leases out of 11 districts, with a view to examine efficiency of the Department
in renewal of the leases and recovery of government revenue. The Revenue
and Forest Department (Department) renewed 4,03916 cases in these five
districts up to 31 March 2017. Out of these, audit test checked 1,52817 cases.
The observations were communicated to the Department and to the
Government in July 2017. The replies of District Collectorates wherever
received have been incorporated in the relevant paragraphs. Replies from the
Government have not been received.

15
Covering 11 districts in two divisions: Nagpur Division – Bhandara, Chandrapur,
Gadchiroli, Gondia, Nagpur, Wardha and Amravati Division - Akola, Amravati, Buldhana,
Washim and Yavatmal.
16
Akola: 11 cases, Amravati: 1,932 cases, Gondia: 950 cases, Nagpur: 216 cases and
Wardha: 950 cases.
17
Akola: 7 cases, Amravati: 280 cases, Gondia: 340 cases, Nagpur: 216 cases and Wardha:
685 cases.

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4.4.1 Trend of renewal of leases of Nazul Land

As per terms and condition of lease, if the lessee fails to pay the rent or
breaches the terms and conditions of the lease agreement, then the
Government can resume the land granted under lease. The statistics of
progress of renewal of Nazul Leases furnished by the Revenue and Forest
Department (Department) as on 31 March 2017 is given below in Table 4.4.1:
Table 4.4.1
Division No. of Districts No. of Nazul No. of leases No. of leases No. of leases yet
leases whose term of renewed to be renewed
lease has expired
Total Selected Total Selected Total Selected Total Selected Total Selected
districts districts districts districts
Nagpur 6 3 25,059 20,580 12,989 9,262 2,219 2,096 10,770 7,166
Amravati 5 2 12,492 8,265 9,288 7,173 3,861 1,943 5,427 5,230
Total 11 5 37,551 28,845 22,277 16,435 6,080 4,039 16,197 12,396
Source: Statistics furnished by Divisional Commissioner, Nagpur and Amravati
It would be seen from the above that 16,197 cases of Nazul leases have not
been renewed as of 31 March 2017. In five test checked Districts out of total
28,845 Nazul leases, 12,396 leases were yet to be renewed as on 31 March
2017. District Collectorate, Wardha, stated that notices were issued to the
lessees for renewal of the lease, but, they did not turn up for the renewal.
However, there was nothing on record to indicate that any action had been
taken by the Department for resumption of the Government land. The reason
for non- renewal of leases was not received or found on records in the
remaining four districts.
4.4.1.1 Development of software for management of Nazul land
The Divisional Commissioner, Nagpur had floated a tender for development
of software for management of Nazul land in Nagpur Division in 2012. After
tendering process, the work was allotted (2012) to M/s Karvy Data
Management Ltd, Hyderabad for ` 15 lakh. No record indicating the progress
made in this regard by the Department was made available to audit. As such
audit could not ascertain the status of work executed. However, audit found
that records were being maintained manually in all the Collectorate offices.
4.4.1.2 Maintenance of proper records of Nazul Leases
The Collector was responsible for renewal of the leases, collection of lease
rent and other matters relating thereto. For this purpose a register called
“Demand Register” was prescribed under the provisions of Revenue Book
Circular (RBC). The RBC was issued under Central Province and Berar Land
Revenue Code. The Code was repealed with effect from August 1967 and the
Nazul lands were governed under MLRC, 1966. However, the Government
had not made any provision for maintenance of such demand register in the
MLRC, 1966.
Scrutiny of records in five Collectorates revealed that demand registers was
being maintained only in two Collectorates viz. Gondia and Wardha while the
remaining three Collectorates viz. Akola, Amravati and Nagpur had not
maintained demand registers of Nazul leases. A comparison of the demand

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Audit Report for the year ended 31 March 2017 on Revenue Sector

registers of these two Collectorates indicated that these were in different

formats. While the Collectorate, Gondia had included all the necessary
columns like amount of lease rent, date of renewal, etc., these were not
included by the Collectorate, Wardha. The Collectorate Nagpur stated that it
was preparing the demand register on the basis of the information obtained
from City Survey Office. The remaining Collectorates did not furnish any
reply.
In the absence of registers the Department did not have any watch over the
timely collection of lease rent and the compliance with terms and conditions of
lease by lessees. Annual leases rent of many years are collected in arrears only
at the time of renewal of lease in most of the cases.
It is recommended that a provision be made for maintenance of the demand
register for Nazul lands under the MLRC, 1966.
4.4.1.3 Execution, registration and absence of standard format of lease
deeds
Registration of lease deed is compulsory under section 17 of Indian
Registration Act, 1908 and as per article 36 of Maharashtra Stamp Act, 1958
stamp duty on lease of 30 years was leviable at the prescribed18 rate on 90 per
cent of the market value of property. Further, the Revenue Book Circular
(RBC) provided for execution of lease deed in Form F and the subsequent
renewal in Form H. However, RBC issued under Central Province and Berar
Revenue Code was repealed with the introduction of the MLR code, 1966. No
such forms were specified in MLR code, 1966.
Execution of lease deeds:-
• Audit noticed that the Department had not adopted a uniform system
for grant, execution and registration of renewal of lease. In Amravati
Division, audit of the test checked districts (Akola and Amravati)
revealed that at the time of renewal of leases, lease deeds were not
being executed and the leases were renewed on the “Office Orders”
issued by the district authorities. In Nagpur Division, audit of test
checked districts (Nagpur, Gondia and Wardha) revealed that lease
deeds were executed and registered only in Nagpur Districts; in
remaining two districts the lease deeds were executed but not
registered. The lease deeds were required to be registered under the
provisions of Section 17 of the Registration Act. Non-execution of
lease deed is fraught with the risk of delayed payment of the lease rent
and non-monitoring of the terms and conditions of lease. Besides, non-
execution / registration of leases at the time of renewal resulted in non-
realisation of stamp duty and registration fee of ` 16.8119 crore in 80
illustrative cases test checked in three districts (Amravati, Gondia and
Wardha).

18
Five per cent in Municipal area (A and B class) and four per cent in Municipal Councils.
19
Stamp duty at the rate of four percent and registration fee at the rate of one percent leviable
on ` 387.61 crore (90 percent of land cost of ` 387.61 crore in terms article 36
Maharashtra Stamp Act, 1958) worked to ` 16.81 crore.

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Format of lease deeds:-

• Further, out of five districts test checked, in three districts (Nagpur,
Gondia and Wardha) the leases continued to be renewed in Form H
with modification by District authorities from time to time. There was
no uniformity in the format of the renewed lease deed. The essential
terms and conditions like provision of levy for unearned income,
interest on delayed payment of lease rent etc. were not specified in the
lease agreement. In the remaining two districts (Amravati and Akola),
no lease deeds were executed. It would be in the interest of revenue, if
uniform format is prescribed for renewal of leases of Nazul land. After
being pointed out the Collectorate Wardha stated that there was no
provision in GR of 2015 for levy of stamp duty. The reply is not
relevant as levy of stamp duty is governed under the Maharashtra
Stamp Act, 1958 and its registration is governed under the Indian
Registration Act, 1908.
4.4.1.4 Non-existence of mechanism to detect transfer of lease of Nazul
land and incorrect description of property cards
The transfer and change of use of Nazul Land without permission could be
regularised by payment of unearned income @ 40 and 50 per cent of market
value of land used for residential and commercial purpose respectively as per
the Government resolution of December 2015. The title of the land shall
remain with the Government irrespective of sale or transfer and the occupants
could hold the land on lease basis.
Audit noticed that in Nagpur, the title of Nazul Land in property cards was
shown in the name of the Government while in the remaining four Districts
(Wardha, Gondia, Amravati and Akola), the title of Nazul Land in property
cards was shown in the name of the lessees and not the Government.
Audit obtained information regarding the sale of lands from the Registration
Department through E-search facility of i-SARITA (Software used by the
Registration Department) in two Districts (Amravati and Akola where separate
Zone was prescribed for Nazul land in Annual Statement of Rates.) and
identified 79 cases of sale/transfer and sub-leasing of Nazul land during
2016-17. Of these, cross verification in respect of 15 instruments of sale and
lease deeds furnished by the Registration Department with the records in
Collectorates revealed that unearned income was not recovered as detailed
below:
• In five cases sale of Nazul land was made at ` 4.06 crore but these
cases were not regularized and unearned income of ` 1.61 crore was
not recovered.
• In the remaining 10 cases change in use of land as well as transfer of
land valued at ` 8.26 crore was made. However, unearned income of
each of ` 4.13 crore for change in use and transfer of land totaling to
` 8.26 crore was not recovered.
Thus there was non-realisation of ` 9.87 crore on account of unearned income.
The records in respect of the remaining 64 cases need to be rechecked to
ascertain the status of payment of the unearned income.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

The Department may co-ordinate with Stamps and Registration Department

and obtain statistics of transactions in respect of Nazul lands periodically for
effective monitoring and collection of unearned income. The Nazul lands were
being sold by the lessees/occupants by executing “sale deeds” thereby
conveying all the rights on the land to the subsequent purchasers as if they
were the exclusive owners/title holders of the land. Since, the occupants of
Nazul Land had only the right to enjoy the benefit of land during the currency
of lease, they could not transfer the land by way of sale deed as they were not
the owners of the land. Government may put in place a mechanism so that the
sale of Government Nazul land is prevented.

4.4.2 Renewal of Nazul lease - Incorrect assessment of lease rent

Government of Maharashtra, Government Resolution dated 11 January 1983
revised the lease rent in respect of Nazul land as where the terms and
conditions of the leases specifically provide for the manner and extent up to
which the rates are to be revised, the revised rent should be worked out in
accordance with the conditions laid down in the respective lease deeds. In all
other cases, the revised lease rent should be worked out at three times of the
previous lease rent. Once the lease rent is fixed, it shall be remain in force for
the entire lease period. There after the lease rents were revised from time to
time as mentioned in the following Table 4.4.2.
Table 4.4.2
GR of June 2007 GR of December 2011 GR of December 2015
The R&FD vide resolution of As per resolution, the As per resolution, the
June 2007 revised the lease revised lease rent was revised lease rent was
rent based on current market fixed equal to 0.10 to 0.50 fixed equal to 0.02 to 0.10
value of the land. As per per cent of the existing per cent of the existing
resolution, the revised lease market value of land, area market value of land, area
rent was fixed equal to prime and use of the land. and use of the land.
lending rate20 (declared by the Where lease had expired Where lease had expired
Bank) Where lease had prior to December 2011, prior to December 2015,
expired prior to June 2007, the lease rent shall be the lease rent shall be
the lease rent shall be levied at the old rate and levied at the old rate and
increased annually by four recovered as arrears. recovered as arrears. The
percent of the old rate and rate fixed shall be revised
The rate fixed shall be
recovered as arrears. The rate after every five years.
revised after every ten
fixed shall be revised after
years.
every ten years.

The term old rate has not been defined in the GRs. The Department continued
to levy the lease rent in accordance with the GR of 1983 up to 2011 despite the
fact that a number of leases had expired and were renewed between 2007 and
2011. This had resulted in loss of revenue as detailed in the following
paragraph.

20
Prime lending rates on 10, 20 and 25 per cent of the existing market value of land viz.
residential, commercial or educational/charitable purpose respectively.
Year 2008- 12.75 per cent, 2009 – 12.25 per cent, 2010 – 11.75 per cent and 2011 – 12.50
per cent.

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• In two Districts viz., Nagpur and Gondia, test check of the files
revealed that 81 leases were renewed between June 2007 and
December 2011. The lease rent of these cases was fixed at pre revised
rates in accordance with the resolution of 1983 instead of rates
prescribed in the resolution of June 2007. The annual least rent paid
by the lessees was ` 0.94 lakh instead of ` 2.45 crore. This resulted in
under assessment of annual lease rent of ` 2.44 crore with cumulative
effect of ` 24.40 crore for ensuing 10 years.
• In another two districts viz. Wardha and Amravati, 35 Nazul land
leases were renewed in 2016. The leases had expired between 1978
and 2015. The Department renewed the leases and levied rent of ` 0.17
crore for the period from 1978 up to December 2015 in accordance
with the rates mentioned in the GR of 1983 and not ` 4.50 crore in
accordance with the GRs of 2007 and 2011. This resulted in short levy
of lease rent of ` 4.33 crore.
• As per GR June 2007 and December 2011 the lease rent shall be
revised after every 10 years while as per GR of December 2015 the
lease rent shall be revised after every 5 years. Once the lease rent was
fixed it remained constant till the date of next revision. The lease rent
had been reduced in 2011 and 2015 as compared to the year 2007. The
minimum rate of lease rent was reduced from 0.10 per cent in 2011 to
0.01 per cent in 2015, i.e. fall of 90 per cent of the previous rates.
Despite the revision in rates of the lease rent in 2015, the lease rent
fixed under the GRs of 2007 and 2011 remained unchanged. Thus
there was no uniformity in revision of the lease rent fixed under
different GRs.
The Collectorate Nagpur stated that the Nazul plot holders were aggrieved by
the revised lease rent which was 100 to 300 times of the old rents in many
areas. Accordingly, the then Revenue and Forest Minister had instructed
(27 November 2007) to stay the GR dated June 2007. The instructions and
relevant documents were not produced to audit. The facts however, indicates
that no serious efforts was made by the Department to fix the rates and period
of lease rent. The parameters on which the lease rent was fixed were not also
made available to audit. Besides in absence of the definition of the Old rates,
the Department continued to treat the old rates mentioned in the GR of 1983.
Thus, the rates of lease rent as per GR dated June 2007 and December 2011
could not be made effective. Thus there is a need to remove the anomalies and
ensure uniformity in fixation of lease rent and its revision.

4.4.3 Levy and collection of unearned income

Government vide resolution of December 2011, August 2014 and December
2015 prescribed the rates of unearned income leviable for change in use,
transfer or breach of conditions of lease agreement in case of Government land
(Nazul) given on lease. Transfer of land or change in use of land without
permission from Government, it is treated as breach of conditions and
accordingly rate of unearned income is leviable. Further, all these resolutions
stipulated that lessees were liable to pay unearned income on the market value
of land as on the date of breach of condition of lease (for change in use or sale

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Audit Report for the year ended 31 March 2017 on Revenue Sector

of land), provided that the prescribed documentary evidence for change of use
from the said date was produced. If the prescribed documentary evidence is
not produced, unearned income is leviable on the current market value of land.
The rates of unearned income applicable as per the resolutions are given below
in Table 4.4.3(A).
Table 4.4.3(A)
(In percentage of market value)
Resolution Unearned income for Unearned income leviable Unearned income for
breach committed prior to if permission obtained breach committed after
issue of GR from Government issue of GR
Current Residential Commercial Residential Commercial Residential Commercial
Land use
December 25 25 Not 12.5 Not 50
2011 prescribed prescribed
August 2014 25 25 Not 12.5 Not 50
prescribed prescribed
December 10 25 5 12.5 40 50
2015

The cases of non/short levy of unearned income in test-checked districts are

detailed below in Table 4.4.3(B).
Table 4.4.3(B)
Name of Audit observation Amount
Districts involved in
crore
1 2 3
Nagpur Audit selected 100 cases of Nazul leases renewed (April 2005 to July 2016) 22.67
by the Collector, Nagpur for residential purpose and cross checked their
land use with the property tax records of the Nagpur Municipal Corporation
(NMC) to ascertain the correctness of land use and found that in 19 cases,
the lessees used land measuring 14,718.81 sqm for commercial purpose i.e.
for shops. The land was allotted for residential purposes.
Thus, there was unauthorised change in use of land. The value of the land
was ` 90.68 crore, the unearned income payable to the Government at the
rate of 25 per cent of market value amounting to ` 22.67 crore was
recoverable.
After this was pointed out the Collectorate Nagpur agreed to conduct physical verification of these lands and if
the lands were found to be used for commercial purpose, unearned income as per GR dated Dec. 2015 would be
recovered.
Amravati and As per the GRs of 2015, unearned income shall be levied separately for 2.25
Wardha sale /transfer and for change of use of land without permission.
It was observed that in 20 cases the lessees had sold the land as well as
changed the use of land between 1963 and 2012. The regularization of sale
of the land was applied for in 2015 and order for commercial use and sale
was given in 2016.The Department was liable to recover unearned income
of ` 4.50 crore for sale of land and change in use of land. However, the
Department recovered only ` 2.25 crore only for one breach i.e. sale and
did not levy unearned income for change in use. This resulted in non-levy
of unearned income of ` 2.25 crore.
The Collectorate Wardha had stated that as per local bodies, the lands fall under the residential as well as
commercial zone. Hence, the unearned income was not leviable for change of use. Reply is not tenable as leases
were given for residential purpose. The commercial use of land in contravention of condition of lease is a breach
which needs to be regularized on payment of unearned income. Classification of land by local bodies is
immaterial. The Collectorate Amravati had not furnished any reply.

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1 2 3
Amravati and Six owners of six shops located at six different commercial places had 15.80
Nagpur approached (January 2015 to October 2016) the Collectorates for
regularisation of their shops. Scrutiny of the documents21 submitted by
these applicants revealed that the erstwhile lessees from whom the
shops were purchased had changed the use of the pieces of land from
residential purpose to commercial complexes by constructing shops on
the six pieces of land admeasuring 23275.13 sqm valued at ` 63.90
crore.
The Department regularized only these six shops and did not take any
action to levy and collect unearned income from remaining shops
existing in those commercial places. The unearned income leviable was
` 15.80 crore.
The Collectorate Nagpur stated that unearned income from remaining occupants would be recovered after
spot verification of the lands. The Collectorate, Amravati had not furnished reply.
Gondia Scrutiny of Renewal files revealed that a lessee had sold land 0.27
admeasuring 1,326.70 sqm without permission in 1992. The breach was
regularized (February 2017) by levying unearned income at residential
rate of 10 per cent of market value of land. However, the reports of spot
verification made by Department in 2011 and statement of lessee on
record indicated that the lessee was using 1,000 sqm out of total area of
1,326.70 sqm for commercial purpose. As such, for this portion,
unearned income at the rate of 25 per cent of the market value of ` 1.08
crore was leviable. However, the Department did not levy unearned
income for unauthorised commercial use of land, which worked out to
` 27 lakh.
The Collectorate Gondia stated that the lessee had used the land for commercial purpose as beedi factory in
the past, now the building on the land was vacant and no commercial activity was being undertaken. Fact
remains that the land was used for commercial purpose hence unearned income was recoverable for change
in use of the land.
Amravati Scrutiny of Renewal files revealed that three Nazul plots total 10.39
admeasuring 10,928.10 sqm were regularised in March 2016 for
commercial purpose. However, while working out the unearned income,
the area of three plots was considered as 2,323 sqm instead of 10,928.10
sqm. Besides, while working out the market value of the property,
Department applied the land rates of the year 1964 instead of Annual
Statement of Rates 2015-16. The omissions on the part of the
Department resulted in short levy of unearned income by ` 10.39 crore.
Collector, Amravati stated that matter would be taken up with higher authorities and thereafter reply would
be furnished.
Wardha Scrutiny of Renewal files revealed that lease of Nazul land measuring 0.94
2,787.00 sqm (FSI 1.42 i.e 3,900.85 sq. mtr) valued at ` 96 lakh was
renewed (February 2015) for the period from 1978 to 2008 for
residential purpose. As per a report of the Municipal Council,
Hinganghat, the purchaser of land (M/s. Mrugnayani Infrastructure)
changed the land use to commercial in 2013 without obtaining
permission from Department. This was regularised by levying unearned
income of ` 12.19 lakh (approximately at the rate of 12.5 per cent).
However, the market value of the land based on the FSI index amount
to ` 2.12 crore. The unearned income payable worked out to ` 1.06
crore at the rate of 50 per cent of the market value. This resulted in
short levy of ` 94 lakh.

21
Copy of sale deed or deed of declaration.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

1 2 3
Wardha Permission to sell the shops admeasuring 3,900.85 sqm located in 0.13
survey no. 28 was granted by the Department in May 2013. The
Department levied unearned income of ` 25 lakh on the market value of
` 2.03 crore. However, audit noticed that Department had worked out
incorrect market value as per land rate of Nazul Sheet No. 27 instead of
Sheet No. 28. The market value of the property aggregated to ` 3.04
crore on which unearned income of ` 38 lakh was leviable. Incorrect
application of rates resulted in short levy of unearned income by ` 13
lakh.
Total 52.45

4.4.4 Internal Control Mechanism

The Collectors have delegated the powers related to management of Nazul
Land to Sub-Divisional Officers in their respective Districts. For effective
administration of Nazul land and to have effective check, it is imperative that
Sub-Divisional Officers in a prescribed interval send progress reports of lease
renewals to the Collector. The Collectors in turn should submit prescribed
periodical report to Divisional Commissioners to achieve an assurance on
timely renewal of lease, collection of rent, correctness of levy of unearned
income etc.
It was observed that the SDOs submitted progress reports only when called for
by the Collectors/Divisional Commissioners. There was no mechanism for
periodic reporting and monitoring in the Department for effective management
of Nazul Land.

4.4.5 Conclusion and Recommendations

Collectorates did not maintain database of Nazul leases and demand registers
to ascertain timely collection of lease rent and expired leases. The property
cards of Nazul Lands in four Districts did not bear the name of Government as
title holder (Muldharak) which resulted in unchecked sale and transfer of
Nazul land. Standard format for renewal of Nazul lease under MLRC was not
prescribed due to which sale deeds for Nazul land were being executed
irregularly. In cases of non-payment of lease rent, the action for resumption of
land from lessee was not taken. Lease agreements were not registered which
led to loss to Government by way of non levy of stamp duty.
The Government may consider issuing instructions for keeping up-
to-date records of Nazul land and correcting the details contained in
property cards. The Government may consider framing Rules under
MLRC, 1966 prescribing the basic forms in which the Nazul
Records should be maintained to achieve uniformity in record
keeping across 11 Districts of Vidarbha for effective management of
Nazul Lands.
Cases of incorrect assessment, short/non levy and incorrect application of rates
for levy of lease rent as well as that of unearned income were noticed. In some
cases regularisation of change in use of land was made incorrectly.
Government may issue instructions to ensure correct assessment and
levy of lease rent and unearned income, their timely collection and

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action in case of breach of conditions by obtaining data from Local

Bodies. The Department should co-ordinate with Department of
Stamps and Registration and obtain statistics of transactions in
respect of Nazul lands periodically for effective monitoring and
collection of unearned income.

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Audit Report for the year ended 31 March 2017 on Revenue Sector

4.5 Other audit observations

During scrutiny of records of the various land records and land revenue
offices, we noticed several cases of non-compliance of the provisions of the
Maharashtra Land Revenue Code, 1966 (MLR code), Government
notifications/instructions as mentioned in the succeeding paragraphs of this
chapter. These are illustrative cases and are based on the test check carried out
by Audit. As, such cases are pointed out by Audit repeatedly; there is need on
the part of the Government to improve the internal control system so that
recurrence of such cases can be avoided.

4.5.1 Short levy of occupancy price

Application of incorrect rate for valuation of land to calculate occupancy
price22 resulted in short levy of ` 1.42 crore
GoM, R & FD sanctioned (March 2012) allotment with advance possession of
Government land to Maharashtra State Electricity Distribution Company
Limited (MSEDCL), Aurangabad. The land admeasuring 52.00 Hectare (i.e.
5,20,000 sqm) bearing gut number 264 situated at mouza Ektuni, Tahsil
Paithan, District Aurangabad was sanctioned for erecting of Electricity Sub-
Station. The occupancy price of ` 2.90 crore was levied on the market value
determined by the Joint District Registrar, Aurangabad (City). The details of
market value worked out were not available.
Scrutiny of records in Office of the Collector, Aurangabad revealed
(November 2013) that the rate of the said land was ` 275 per sqm. Based on
the slab rates23 the market value of the property comes to ` 8.64 crore24. As
per instruction 30 of the Annual Statement of Rates (ASR) 2012, 50 per cent
of the cost of the land was required to be paid to the Government as
occupancy price which worked out to ` 4.32 crore. This resulted in short levy
of occupancy price of ` 1.42 crore25.
This was pointed out by the audit between November 2013 and December
2013), the reply of the Collector, Aurangabad is awaited (February 2018).
This was brought to the notice of Government (April 2017 and August 2017).
Reply thereto was awaited (February 2018).

22
As per rule 2 (k-i) of Maharashtra Land Revenue (Disposal of Government Land) Rules,
1971, occupancy price means the price payable as consideration for the grant of the right to
occupy and use land. It is the market value of the land determined as per the rates
prescribed in ASR.
23
Government of Maharashtra, Revenue & Forest Department vide resolution (2008)
prescribed the specific slabs for valuation of Government land allotted to the various
institutions.
24
2,000 X ` 275 X 100% = ` 5,50,000
2,000 X ` 275 X 90% = ` 4,95,000
2,000 X ` 275 X 80 % = ` 4,40,000
4,000 X ` 275 X 70% = ` 7,70,000
5,10,000 X ` 275 X 60 % = ` 8,41,50,000
Total = ` 8,64,05,000.
25
` 4.32 crore - ` 2.90 crore.

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4.5.2 Short recovery of unearned income

Department did not calculate the market value as per the rate prescribed
in Annual Schedule of Rates for levy of unearned income, which resulted
in short recovery of ` 36.53 lakh
As per Government resolution (July 2002 and May 2006) of Revenue and
Forest Department, if Class-II land26 is converted into Class-I land27 for non-
agricultural purposes, then the unearned income28 amount equivalent to
50 per cent of market value29 of the land determined as per the rates prescribed
in ASR, should be recovered from the applicant.
Additional Collector, Dhule passed an order (September 2012) granting the
permission for conversion of Class-II land into Class-I land. The area of the
land was 3.06 Hectare (i.e. 30,600 sqm) bearing gut number 203/3, 203/4
situated at mouza Jaitane, Tahsil Sakri, District Dhule. The market value of the
land was assessed at ` 9.18 lakh and unearned income amounting to
` 4.59 lakh30 was recovered (September 2012). However, details of
calculation of market value were not found on record.
Scrutiny of records in the Office of the District Collector, Dhule revealed
(March 2015) that the market value of the land was ` 400 per sqm as per
ASR-2012. The market value worked out to ` 82.24 lakh. Accordingly,
unearned income, amounting to ` 41.12 lakh31 was required to be recovered.
Thus, incorrect assessment of market value of the land resulted in short
recovery of unearned income by ` 36.53 lakh (` 41.12 lakh - ` 4.59 lakh).
Additional District Collector stated (March 2015) that the matter will be
scrutinized and reply will be submitted.
This was brought to the notice of Government (May 2017 and August 2017).
Reply thereto was awaited (February 2018).

26
Class-II land means the land which occupant hold unalienated land in perpetuity subject
to restrictions on the right to transfer.
27
Class-I land means land without any restriction on the right to transfer.
28
Unearned income means an amount equal to difference between current market value or
the price realised by way of sale, whichever is higher.
29
Market value as per Section 2 (na) of Maharashtra Stamp Act,1958, means the price
which such property would have fetched if sold in open market on the date of execution
of such instrument, or the consideration stated in the instrument, whichever is higher.
30
50 per cent of ` 9.18 lakh.
31
50 per cent of ` 82.24 lakh.

87