AMITY LAW SCHOOL (II)

Land Law Project on,

Land Ceiling Legislation in INDIA

Submitted By:Sarthak Nema

(A11921613028)
Student of B.Com, LL.B (H) - 6th Semester

Submitted To,
Dr. Manish Yadav

ACKNOWLEDGEMENT

On the very outset of this report, I would like to extend my sincere & heartfelt obligation towards
all the personages who have helped me in this endeavor.
Without their active guidance, help, cooperation & encouragement, I would not have made
headway in the project.
I am ineffably indebted for conscientious guidance and encouragement to accomplish this
assignment.
I am extremely thankful and pay my gratitude to my faculty Dr. Manish Yadav for his valuable
guidance and support on completion of this project in its presently.
I extend my gratitude to AMITY LAW SCHOOL (II) for giving me this opportunity.
Any omission in this brief acknowledgement does not mean lack of gratitude.

DECLARATION OF AUTHENTICITY

I, the undersigned, SARTHAK NEMA, student of B.Com, LL.B (H) 6th Semester, Amity Law
School II, Amity University, Noida, declare that this dissertation is my original work, gathered
and utilized especially to fulfil the purposes and objectives of this study, and has not been
previously submitted to any other university for a higher degree. I also declare that the publications
cited in this work have been personally consulted.

Signature: ____________________________________

Date: ________________________________________

TABLE OF CONTENTS

S. No.

PARTICULARS

Page No.

1.

INTRODUCTION........................

2.

HISTORY.....

3.

ECONOMISTS VIEWS ON LAND CEILING.....

4.

NEED FOR LAND CEILING LEGISLATION..

5.

CONSTITUTIONAL VALIDITY..

6.

LAND CEILING LEGISLATION

Provisions under Urban Land (Ceiling and Regulation) Act,

1976.

16

Rationale for Repeal.

16

LAND CEILING LEGISLATION IN UTTAR PRADESH

19

8.

Legislation under Urban Land (Ceiling and Regulation) Repeal

Act, 1999.

7.

10

Compensation...

20

CONCLUSION.....

21

INTRODUCTION
Land continues to be of growing importance in today's age of technology and development and
the essence of land is etched deep within the history of India. The concept of ownership of land
was not prevalent in ancient India and from Vedic era till the establishment of Lord Ashoka
"zamindars" were non-existent. Kings thereafter did not own land and they were only responsible
to provide security to its subjects, whereas it was the subjects who gave a certain percentage of the
agricultural produce to the Kings as revenue. In the age of the Mughals, land or "Mouza" attained
a lot of value and collectors become frequent, who in turn were concerned with only extortion of
revenue from the tillers of the land. With the establishment of East India Company in Bengal,
zamindars attained the status of erstwhile Kings and they engaged themselves in extortion and
torture of farmers to return a fixed amount to the British government. The important step of land
reforms relates to the imposition of ceiling on land holdings. Ceiling on land holdings implies the
fixing of the maximum amount of land that an individual or family can possess. Land ceiling has
two aspects: one, the fixation of ceiling limit and two, the acquisition of surplus land and its
distribution among the small farmers and landless workers. The imposition of ceiling on
agricultural holding is preeminently a redistributive measure. Prof. Gadgo rightly observes,
Among all resources, the supply of land is the most limited and the claimants for its possession
are extremely numerous. It is, therefore, obviously unjust to allow the exploitation of any large
surface of land by a single individual unless other overwhelming reasons make this highly
desirable. According to some economists small farms are more efficient than large farms. Prof.
C. H. Hanumatha held the view that small farms provide more employment opportunities. They
require less capital compared to the large farms. He further added that small farms can be made
into large farms through cooperative effort so as to have scale economies. The idea of imposing
ceilings on agricultural land holdings is novel to India. It was Prof. Radha Kamal Mukherjee
who, perhaps for the first time, mooted the idea in his memorandum submitted to the SubCommittee for Land Policy of the National Planning Committee. After Independence. Bombay,
Uttar Pradesh and a few other Slates imposed ceiling on future acquisition of land. The principle
that there should be an absolute limit to the amount of land which an individual may hold was
officially commended for the first time in the First Five Year Plan. It was reiterated in the Second
Plan. Though the imposition of ceiling on land holdings has been accepted by the Government of
India in principle, the State Government have not shown much enthusiasm for its implementation.
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Ceiling on land holdings as an integral part of the programme of agrarian reforms of the main
planks of the Congress election manifesto in 1952 and in 1957. The failure of the various State
Governments to fulfil the election pledge of ushering in land reforms naturally proved to be a
source of real embarrassment to the Congress High Command.

HISTORY
The Urban Land Ceiling Act (ULCRA) was introduced during Prime Minister Indira Gandhis
regime as a means for lower income sections to fulfill their dreams for a home. The main purpose
of the Act was to prevent hoarding or excessive holding of land in urban agglomerations by few
people so as to facilitate proper distribution and uniform development of all sectors of urban areas1.
It had been noticed that private dealings were leading to speculation and profiteering and
prevention of this kind of trade was one of the objectives of the UCLRA. The Act applied to large
cities because the shortage of land was felt more grievously there as there was a constant influx of
population. Urban Agglomerations were covered in their entirety by the Act and the peripheral
areas were specially considered to prevent haphazard growth. The statement of objectives of the
Act reads as follows:The Repeal Act is intended to achieve the following objectives:i.

To prevent concentration of urban property in the hands of a few persons and speculation
and profiteering therein.

ii.

To bring about socialization of urban land in urban agglomerations to subserve the common
good by ensuring its equitable distribution.

iii.

To discourage construction of luxury housing leading to conspicuous consumption of

scarce building materials and to ensure the equitable utilization of such materials.

iv.

To secure orderly urbanization.

The Urban Land (Ceiling and Regulation) Act, 1976 came into force on 17.02.1976. The States of Andhra Pradesh,
Haryana, Gujarat, Himachal Pradesh, Karnataka, Maharashtra, Orissa, Punjab, Tripura, Uttar Pradesh and West
Bengal initially adopted the Act. Subsequently it was adopted by six more states namely Assam (25.03.76), Bihar
(01.04.1976), Madhya Pradesh (09.09.76), Manipur (12.03.76), Meghalaya (07.04.76) and Rajasthan (09.03.76). The
Act was being implemented in the urban agglomeration having population of more than two lakhs as per the 1971
Census (64 urban agglomerations).

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Even though government took over a considerable amount of land, it did nothing at all to meet
these objectives. The land that was easily available earlier became scarce because it completely
went out of circulation and the buying process came to a standstill, creating shortage in housing.
The bureaucrats/ politicians and builders came together and the government gave the land as 10
per cent from the chief ministers quota to take care of the problems of shortage in housing 2. The
land was either being exempted under Sections 20/21 altogether or being acquired under Section
6-14 but not being used for the purposes of the Act and therefore, not affecting the housing market
favorably. Thus the Urban Land Ceiling Act (1976) distorted land markets in urban areas,
exacerbated the growth of slums and limited the growth of private enterprises by creating an
artificial shortage of land where none existed and this led to land rates shooting up beyond their
actual value. This completely defeated the objectives of the Act, as the land was further out from
the reach of the marginalized sections of the society than before the Act was passed. The Central
Government repealed this 1999, but the state governments have not followed the lead. States like
Punjab, Uttar Pradesh, Madhya Pradesh, Rajasthan, Gujarat and Haryana have repealed this act
but states like Maharashtra and Bihar, Delhi are still favoring the ULC Act.

ECONOMISTS VIEWS ON LAND CEILING

The economists believing in free market/capitalism, didnt liked land ceiling. These were their
arguments:Anti-Land Ceiling

Land ceiling should be abolished, even

Pro Land Ceiling

corporate sector should be allowed to buy

agricultural land.

income tax.

This will enable the enterprising farmer to

enlarge his holding by buying or leasing
lands of small farmers.

Agricultural income is exempted from

So, if land ceilings are removed, the rich

people will rush to buy farm land.

Thus land prices will soar. A new

intermediary group of Agricultural land
mafia will emerge.

http://www1.economictimes.indiatimes.com/articleshow/msid-1581961,curpg-2.cms.

3|Page

Although landlessness will increase but

these

small

farmers

could

find

employment in agricultural and allied

But millions of small and marginal farmers

will be pushed off their land.

Hence, the time is not yet ripe to bring

sector as a result of capitalist mode of

forth such drastic reforms (of removing

production.

land ceilings).

Capitalist mode of agriculture =>more

Capitalist mode of agriculture uses more

surplus income => invested back into the

machines, less laborers => unemployment

agriculture will finally lead to economic

increased.

growth.

Yes, Economic growth will be achieved

If corporate sector is allowed to enter in

but at the cost of unemployment and

agriculture => Agriculture exports will

subsequent fall in human development.

increase

=>more

foreign

exchange

incoming =>Current Account deficit gone,

rupee will strengthen.

Small farms are not productive because

Large farms tend to prefer monoculture

they hinder mechanised farming.

(single crop), because they can be easily

Small farmers have limited capital to

managed with heavy machinery will lead

invest

to more susceptible to pest attacks which

in

improving

agricultural

Production.

is not good from soil fertility point of view.

Small farmers usually have mixed crops

(intercropping), they combine and rotate
crops and livestock, with manure and the
soil fertility improves.

Land ceiling and distribution => poverty

and disguised unemployment continues.

Villagers should be kept self-employed,

even if on small and marginal farms.

4|Page

Some people need to be shifted from

agricultural

sector

to

This fits with Gandhian ideas of village

republics.

manufacturing/service sector. There is no

need to give land to each and every
landless person.

NEED FOR LAND CEILING LEGISLATION

After abolition of Zamindari, the (superior) tenant farmers became virtual owners of the land. They
owned tens and hundreds of acres of land. While other (inferior tenants/sharecroppers/landless
laborers) owned nothing. Many Zamindars themselves kept lot of land in pretext of personal
cultivation. The Constitution of India itself directs for necessary Articles regarding land reforms.
These directives are provided in the Part IV of the Constitution of India, i.e., Directive Principle
of State Policy (DPSP). Such directives are:i.

Article 383 seeks to minimize the inequalities of income, status, facilities and opportunities.
Land ceiling minimize inequality in the land ownership and thus reduces inequality of
income.

ii.

Article 394 wants to ensure that the operation of economic system does not result in the
concentration of wealth. In a village, land is equal to wealth, hence land ceiling is necessary
to prevent concentration of wealth in the hands of few. It also wants to give right to
adequate means of livelihood for all citizens. Land ceiling (and subsequent land
redistribution) provides self-employment opportunities to landless agricultural laborers.

The Constitution of India, 1949: Article 38: State to secure a social order for the promotion of welfare of the people

The Constitution of India, 1949: Article 39: Certain principles of policy to be followed by the State: The State shall,
in particular, direct its policy towards securing

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There are also some other reasons which makes the implication of Land Ceiling legislation
necessary:i.

If there is no land ceiling, rich farmers will buy all the land of entire village and tehsil. But
since they cannot cultivate all the land by themselves, theyll lease it to small farmers
(tenants). Small farmer (tenant) doesnt have any motivation to work harder because he
doesnt own the land and he has to give 30-50-70% of the produce to that rich farmer, as
rent is equal to exploitation.

ii.

So, after abolishing Zamindari, if State Governments had not implemented Land ceiling,
then rich farmers or superior tenants would have become the new de-facto or virtual
Zamindars of Modern India.

iii.

If the individual/family owns more land than the ceiling limit, the surplus land is taken
away (with or without paying compensation to original owner), so that this surplus land is
distributed among small farmers, tenants, landless labourers or handed over to village
panchayat or given to cooperative farming societies.

iv.

If land ceilings are removed, the rich people will rush to buy farm land. Thus land prices
will soar. A new intermediary group of Agricultural land mafia will emerge.

v.

Large farms tend to prefer monoculture (single crop), because they can be easily managed
with heavy machinery so it will be more susceptible to pest attacks, not good from soil
fertility point of view. And Small farmers usually have mixed crops (intercropping), they
combine and rotate crops and livestock, with manure and soil fertility improves.

6|Page

CONSTITUTIONAL VALIDITY
Under Article 2465 of the Constitution of India, the Parliament has the exclusive power to make
laws with respect to matters enumerated in Union List of the seventh schedule. Under Article 2496
and 2507, Parliament can legislate with respect to matters in the state list for national interest and
during the period when emergency has been declared. Now under Entry 188 of List II, land whether
agricultural or non-agricultural falls under the purview of states jurisdiction. Therefore, if the
centre wants to make a law on the same, then as per Article 2529, at least two states have to pass a
resolution stating that they want the centre to make law on the point for them. On this point itself
there have been conflicts, with the state of Andhra Pradesh claiming that the centre was given
power to enact a low on ceilings on immoveable property whereas they went ahead and enacted a
law placing ceilings on urban land. But the Supreme Court said that ceilings on immoveable
property are wide enough to include ceilings on urban land10. So far as the state of Madhya Pradesh
was concerned it was contended by a resolution passed before the enactment to the Act by various
states, Parliament derived power to legislate for those states and that as the legislature of the State
of MP had not passed any such resolution, the centre had no power to pass the legislation for MP.
But the High Court held that the Parliament has jurisdiction under Article 252(1) of the
Constitution to enact the legislation for the state of MP.11 In a recent case, it was held that when
two or more state legislatures resolve under Article 252 that a particular state list item would there
forward be regulated by the Parliament by law and such a law is enacted by the Parliament, then
the states concerned for the period for which the Act is applicable would have no jurisdiction to
amend or repeal the Act12. The constitutional validity of the Act was also considered in Maharao

The Constitution of India, 1949: Article 246: Subject matter of laws made by Parliament and by the Legislatures of
States.
6

The Constitution of India, 1949: Article 249: Power of Parliament to legislate with respect to a matter in the State
List in the national interest.
7
The Constitution of India, 1949: Article 250: Power of Parliament to legislate with respect to any matter in the State
List if a Proclamation of Emergency is in operation
8
Land, that is to say, rights in or over land, land tenures including the relation of landlord and tenant, and the collection
of rents; transfer and alienation of agricultural land; land improvement and agricultural loans; colonization.
9
The Constitution of India, 1949: Article 252: Power of Parliament to legislate for two or more States by consent and
adoption of such legislation by any other State.
10
Union of India v. Valluri Basavaiah Chowdhuryi, AIR 1979 SC 1415.
11
Rajendra Kumar v. State of MP, AIR 1979 MP 108.
12
Birajananda Das Gupta v. Competent Authority Under the Urban Land Ceiling Act, AIR 1988 Cal. 8.

7|Page

Sahib Shri Bhim Singhji v. UOI13. The Act itself was constitutionally valid but Sec. 27(1) of the
same which deals with restrictions on transfer of any urban land which was within the ceiling area
as invalid. The case of Dattatreya v. State of Maharashtra14 also declared the Act to be
constitutionally valid.

LAND CEILING LEGISLATION

Ceiling legislations in India have been enacted and implemented in all states in two phases. The
first phase continued upto 1972. The second phase started from 1972. The important provisions of
ceiling legislations constitute:a. Unit of application: In the first phase, i.e., prior to 1972, the basis of ceiling fixation was

an individual as a unit instead of a family. Since 1972, a family has been accepted as the
unit of application of ceilings. The family is defined as a unit consisting of husband, wife
and children.
b. Upper limit for land holdings: In the first phase there were wide variations in the ceilings
on land holdings. Different states fixed different upper limits for land holdings. For
example, in Andhra Pradesh, the limit of ceiling varied from 27 to 216 acres. In Rajasthan
it varied from 22 to 366 acres.
Under the new revised policy, the upper limit of ceiling has been lowered. For example,
for lands which have assured supply of water and where at least two crops are raised, the
upper limit has been fixed at 10 to 18 acres depending on the productivity of the land. In
areas where there is irrigation provision only for one crop, the ceiling has been fixed at 27
acres. However, for the remaining types of land, the ceiling limit is fixed at 54 acres.
c. Exemptions: Certain types of land were exempted from ceiling laws. Among the types of
land exempted were orchards, grazing lands, sugar-cane fields of sugar factories, cooperative farms etc.
d. Surplus land and its distribution: The progress in respect of surplus land and its
distribution has been quite unsatisfactory. The sixth plan target was that the entire surplus

13
14

AIR 1981 SC 234.

AIR 1989 SC 1796.

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land was to be taken possession of and distributed by 1982-83. But this is far from being
achieved still.
A number of factors such as illegal transfer of land, judicial interventions, loopholes in
ceiling laws, non-availability of land records, inefficient administration, political pressure
etc. account for the failure of the land ceiling. Prof. M.L. Dantwala rightly observed, By
and large, land reforms in India enacted so far are in the right direction, and yet due to lack
of implementation the actual results are far from satisfactory.
The Urban Land (Ceiling and Regulation) Act, 1976 (Act no. 33 of 1976) being the Central
Governments legislation was enacted by the Parliament of India with the view to make provisions
as to imposition of a ceiling on vacant land in urban agglomerations, also to acquiring such land
in excess of the ceiling limit, for regulating the construction of buildings thereon. The Act make
further provisions for preventing the concentration of urban land in the hands of a few persons and
speculation and profiteering therein, as such the Act sought to provide for equitable distribution of
land in urban agglomerations in common good. The subject matter of this legislation is Land and
the same comes under the authority of State legislature, however, with the view to ensure the
uniformity in approach, the Government of India has took initiative and certain states passed
resolutions under Article 252(1)15 of the Constitution of India, wherein the Parliament was
empowered to enact this Act. So far as the applicability of this legislation is concerned, the Act
under its first section says that the States of Andhra Pradesh, Gujarat, Haryana, Himachal Pradesh,
Karnataka, Maharashtra, Orissa, Punjab, Tripura, Uttar Pradesh and West Bengal and all the Union
territories are subjected to this Act and other States can also adopt this Act by passing resolutions
as aforesaid. However, this act was repealed through the Urban Land (Ceiling and Regulation)
Repeal Act, 1999 by the Government of India. However, the State of West Bengal continues to
adopt and implement this said legislation for social benefit and ceiling of urban land. The purpose
behind the Act is to prevent concentration of urban land in the hands of few persons and to prevent

15

ARTICLE 252 (1): If it appears to the Legislatures of two or more States to be desirable that any of the matters with
respect to which Parliament has no power to make laws for the States except as provided in Articles 249 and 250
should be regulated in such States by Parliament by law, and if resolutions to that effect are passed by all the House
of the Legislatures of those States, it shall be lawful for Parliament to pass an Act for regulating that matter
accordingly, and any Act so passed shall apply to such States and to any other State by which it is adopted afterwards
by resolution passed in that behalf by the House or, where there are two Houses, by each of the Houses of the
Legislature of that State.

9|Page

profiteering so that equitable distribution of land can be achieved for the benefit of the entire
population.
Provisions under Urban Land (Ceiling and Regulation) Act, 1976
The provisions of Section 316 of the Act provides that in respect of the territories concerned under
this Act for which the ceiling limit is provided, no persons should be entitled to hold any vacant
land in excess of that ceiling limit. Section 417 deals with such ceiling limit for every person.
Ceiling limit is the maximum limit upto which a person can hold the land. Under the said Act,
there are four types of urban agglomeration and the ceiling limit varies accordingly:a. Where the vacant land is situated in an urban agglomeration falling within category A
specified in Schedule I, five hundred (500) square metres.
b. Where such land is situated in an urban agglomeration falling within category B specified
in Schedule I, one thousand (1000) square metres.
c. Where such land is situated in an urban agglomeration falling within category C specified
in Schedule I, one thousand five hundred (1500) square metres.
d. Where such land is situated in an urban agglomeration falling within category D specified
in schedule I, two thousand (2000) square metres.
Where any person holds vacant land situated in two or more categories of urban agglomeration
specified in Schedule I then, for the purpose of calculating the extent of vacant land held by him:a. One square metre of vacant land situated in an urban agglomeration falling within category
A shall be deemed to be equal to two square metres of vacant land situated in urban
agglomeration falling within category B, three square metres of vacant land situated in an
urban agglomeration falling within category C and four square metres of vacant land
situated in an urban agglomeration falling within category D.
b. One square metre of vacant land situated in an urban agglomeration falling within category
B shall be deemed to be equal to one and one-half square metres of vacant land situated in

16

The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 3: Except as otherwise provided in this Act, on and from
the commencement of this Act, no person shall be entitled to hold any vacant land in excess of the ceiling limit in the
territories to which this Act applies under sub-section (2) of section 1.
17
The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 4.

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an urban agglomeration falling within category C and two square metres of vacant land
situated in an urban agglomeration falling within category D.
c. One square metre of vacant land situated in an urban agglomeration falling within category
C shall be deemed to be equal to one and one-third square metres of vacant land situated
in an urban agglomeration falling within category D.
Where in respect of any vacant land any scheme for group housing has been sanctioned by an
authority competent immediately before the commencement of this Act, then, the person holding
such vacant land at such commencement shall be entitled to continue to hold such land for the
purpose of group housing, but not more than one dwelling unit in the group housing shall be owned
by one single person and further, that the extent of vacant land which such person shall be entitled
to hold shall, in no case, exceed:a. The extent required under any building regulations governing such group housing.
b. The extent calculated by multiplying the number of dwelling units in the group housing
and the appropriate ceiling limit referred to in sub-section (1), whichever is less.
Group Housing means a building constructed or to be constructed with one or more floors, each
floor consisting of one or more dwelling units and having common service facilities. There are
also some other limits on ceilings:a. Where any firm or unincorporated association or body of individuals holds vacant land or
holds any other land on which there is a building with a dwelling unit therein or holds both
vacant land and such other land, then, the right or interest of any person in the vacant land
or such other land or both, as the case may be, on the basis of his share in such firm or
association or body shall also be taken into account in calculating the extent of vacant land
held by such person.
b. Where a person is beneficiary of a private trust and his share in the income from such trust
is known or determinable, the share of such person in the vacant land and in any other land
on which there is a building with a dwelling unit therein, held by the trust, shall be deemed
to be in the same proportion as his share in the total income of such trust bears to such total
income and the extent of such land apportionable to his share shall also be taken into
account in calculating the extent of vacant land held by such person.

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c. Where a person is a member of a Hindu undivided family, so much of the vacant land and
of any other land on which there is a building with a dwelling unit therein, as would have
fallen to his share had the entire vacant land and such other land held by the Hindu
undivided family been partitioned amongst its members at the commencement of this Act
shall also be taken into account in calculating the extent of vacant land held by such person.
d. Where a person, being a member of a housing co-operative society registered or deemed
to be registered under any law for the time being in force, holds vacant land allotted to him
by such society, then, the extent of land so held shall also be taken into account in
calculating the extent of vacant land held by such person.
e. Where a person holds vacant land and also holds any other land on which there is a building
with a dwelling unit therein, the extent of such other land occupied by the building and the
land appurtenant thereto shall also be taken into account in calculating the extent of vacant
land held by such person.
f. Where a person owns a part of a building, being a group housing, the proportionate share
of such person in the land occupied by the building and the appurtenant thereto shall also
be taken into account in calculating the extent of vacant land held by such person.
The Section 518 of the Act says that the transferred vacant land either by way of sale, mortgage,
gift, etc. by the persons in the State to which this Act is applicable should also be considered while
calculating the extent of vacant land held by him. All the persons holding such excess vacant land
should file a statement within the prescribed period before the competent authority. Such statement
should specify the location, extent, value, etc. of such vacant land and also land over which any
building is erected. As per Section 819 of the Act, the competent authority is required to prepare a
draft statement in respect of such persons, based on the Statements filed by them and all such draft
statements are required to serve upon the person along with notice wherein any objection thereto
should be invited and the period for making of such objection is thirty days. And such Objections
to be dealt with by the competent authority and pass appropriate orders thereon. As such, the
competent authority is required to proceed for making final Statement wherein the determined
vacant land held by the person concerned in excess of the ceiling limit should be stated. After
complying all such procedure, the next move is to acquire the vacant land in excess of ceiling limit
18
19

The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 5.

The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 8.

12 | P a g e

by publishing a notification by the competent authority. Such notification is to contain that the
concerned land will be acquired by the concerned State Government; and also claims of interested
persons can be made by them. On determination of such claims, the competent authority to declare
by notification that the concerned land is acquired by the State Government.
Further, Section 1120 being important makes provisions as to making of payments by the State
Government concerned for acquiring such vacant land, to the persons interested therein. And for
determining the disputes as to such acquisition, the persons being aggrieved can approach to the
Urban Land Tribunal with his appeal. The said Tribunal is to be constituted by the State
Government and while deciding such appeals the Tribunal are conferred with all powers and
procedure of the Civil Court dealing with the appeals within the Code of Civil Procedure, 1908.
Provisions as to second appeal have also been provided under the Act, which should lie before the
concerned High Court.
Besides all these most relevant provisions, the Act also provides for several other provisions
including, the provision empowered the competent authority to enter in the Vacant land or land
consisting building thereof for making survey and doing measurements for the purposes of this
Act. However, if any particulars respecting the concerned land, is being concealed, etc. then
persons liable thereof will be held responsible to pay penalty. All such lands so acquired under this
Act are required to be disposed of as per provisions of Section 2321 of the Act, where the State
Government can allot such lands to the persons for industrial purpose or for providing residential
accommodation of approved type to the employees of any industry. Besides this, the further
provisions are also made being relevant to the purpose of the Act, and some of those are explained.
The objects of the Urban Land (Ceiling and Regulation) Act, 1976 inter alia are to impose a ceiling
on vacant lands in urban agglomeration and to acquire vacant lands in excess of the ceiling limit.
Under Section 2(q)22 of the said Act, the expression vacant land shall not include "land mainly
used for the purpose of agriculture".

20

The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 11.
The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 23.
22
The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 2 (q): vacant land means land, not being land mainly
used for the purpose of agriculture, in an urban agglomeration, but does not include
21

(i) land on which construction of a building is not permissible under the building regulations in force in the area in
which such land is situated;

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In Birajananda Das Gupta (Deceased) vs. Competent Authority23, the Hon'ble Calcutta High
Court while dealing with the question whether the competent authority under the Urban Land
(Ceiling and Regulation) Act, 1976 can inquire and investigate whether a particular land registered
in the Record-of-rights as agricultural land is actually being used for such said purpose, held that
Explanation (B) to Section 2(o) of the Act reads- 'land shall not be deemed to be used mainly for
the purpose of agriculture, if such land is not entered in the revenue or land records before the
appointed day as for the purpose of agriculture'. The court further held that 'land must satisfy two
tests' (1) it must in fact be used mainly for the purpose of agriculture, and (2) it must also be entered
as such in the relevant records. Both the tests must be satisfied and both the user and the entry as
agricultural land must concur. The provisions, therefore, unmistakably demonstrate that mere entry
in the records as agricultural is not, by itself, at all decisive as to the land being used mainly for
the purpose of agriculture within the meaning of the Urban Land Ceiling Act to justify its exclusion
from its operation. And, therefore, if the mere entry in the records does not determine the character
of the land, such an entry, by itself, cannot stand in the way of initiation of proceeding under the
Act in order to determine as to whether the land is in fact mainly used for agriculture to go outside
the ambit of the Act, as neither mere user without corresponding record, nor mere record without
actual user, is decisive of the matter, it should be, and it really is, obvious that a mere record as
agricultural land cannot prevent the Competent Authority from initiating proceeding in order to
ascertain as to whether the land in question is really one which is mainly used for agricultural
purpose within the meaning of the Act. Explanation (B) to Section 2(o) of the Urban Land Ceiling
Act clearly indicate that entry in the Record-of-Rights classifying the land as agricultural is only
one of the two requirements required to be satisfied before a land can be deemed to be mainly used
for the purpose of agriculture to justify exclusion of the land from the operation of the Act and the
Competent Authority would obviously be required to inquire further as to whether the other
(ii) in an area where there are building regulations, the land occupied by any building which has been constructed
before, or is being constructed on, the appointed day with the approval of the appropriate authority and the land
appurtenant to such building; and
(iii) in an area where there are no building regulations, the land occupied by any building which has been constructed
before, or is being constructed on, the appointed day and the land appurtenant to such building: Provided that where
any person ordinarily keeps his cattle, other than for the purpose of dairy farming or for the purpose of breeding of
live-stock, on any land situated in a village within an urban agglomeration (described as a village in the revenue
records), then, so much extent of the land as has been ordinarily used for the keeping of such cattle immediately before
the appointed day shall not be deemed to be vacant land for the purposes of this clause.
23

AIR 1988 Cal 8.

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requirement as to the land being actually used for the purpose of agriculture has also been satisfied
before it can order exclusion of a land from the operation of the Act.
The Competent authority is having certain other powers under the Act, which are provided under
Section 3124 and are similar to that of certain powers of civil Court provided under provisions of
the Code of Civil Procedure, 1908. The State Government can issue necessary directions to the
competent authority and the Central Government can give necessary directions to the State
Governments. The Competent authority is required to furnish relevant returns and reports to the
State Government concerned.
Section 3825 of the Act describes certain offences under this Act and also provides for punishment
in relation thereto. Section 3926 provides for offences by companies under this Act and person
liable thereof. Further, the Court taking cognizance of offences under this Act, should proceed
with, only after there is a written complaint made by the competent authority or authorised officer
thereof and such Court should not be inferior to that of Metropolitan Magistrate or a Judicial
Magistrate of the first class. All officers who are acting under this Act, Rules, etc., under this Act,
should be treated as Public servant. The Central Government under this Act is empowered to
provide for Rules, for carrying on the provisions of this Act and such rules to provide on matters
enlisted under Section 4627. Lastly, the said Government is also empowered to provide for orders
removing difficulties which can arise while giving effect to the provisions of this Act. The present
Act is, however, now repealed by the provisions of the Urban Land (Ceiling and Regulation)
Repeal Act, 1999 (Act no. 15 of 1999). Although the Act of 1976 was repealed by the parliament
through the act of 1999, but this act is still in force in some states like Andhra Pradesh which have
not yet adopted the repealed act of 1999.
Section 3 of the Act of 1999 having certain provisions will not affect which state that there are
certain activities which cannot be affected by the repealing act of 1999.

24

The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 31.
The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 38.
26
The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 39.
27
The Urban Land (Ceiling and Regulation) Act, 1976: Sec- 46.
25

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Legislation under Urban Land (Ceiling and Regulation) Repeal Act, 1999
The Urban Land (Ceiling and Regulation) Repeal Act, 1999 has repealed Urban Land (Ceiling and
Regulation) Act, 1976. The repealing act however has certain savings and these savings are
provided in Section 3 of the repealing act. The repealing act shall not affect the vesting of any
vacant land under Sub-Section (3) of Section 10, possession of which has been taken over by the
State Government or any person duly authorised by the State Government or by the competent
authority. It will also not affect the validity of any order granting exemption under sub-section (1)
of section 20 or any action taken thereunder, notwithstanding any judgment of any court to the
contrary and also any payment made to the State Government as a condition for granting
exemption under sub-section (1) of section 20.
Where any land is deemed to have vested in the State Government under sub-section (3) of section
10 of the principal Act but possession of which has not been taken over by the State Government
or any person duly authorised by the State Government or by the competent authority and any
amount has been paid by the State Government with respect to such land then, such land shall not
be restored unless the amount paid, if any, has been refunded to the State Government. All
proceedings relating to any order made or purported to be made under the principal Act pending
immediately before the commencement of this Act, before any court, tribunal or other authority
shall abate provided that, this act shall not apply to the proceedings relating to sections 11, 12, 13
and 14 of the principal Act in so far as such proceedings are relatable to the land, possession of
which has been taken over by the State Government or any person duly authorised by the State
Government or by the competent authority.
Rationale for Repeal
"The Urban Land (Ceiling & Regulation) Act has failed to achieve its objectives due to its poor
performance. Out of 2,20,675 ha.28 of estimated excess vacant land, 50,046 ha. of vacant land
vested in the State Governments29. Physical possession was acquired only of 19,020 ha. of vacant
land by the State Governments. There has been a demand to repeal this Act so that the stock of

28
29

Hectares.
http://www.ebc-india.com/lawyer/articles/9902a1.htm.

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urban land increases and development of urban land for various sectors, namely, housing,
transport, industry, etc. may be available. The Government has decided to repeal this Act.
Repeal of this Act will also facilitate the availability and affordability of urban land, by increasing
supply of urban land....", was stated by the Minister of Urban Affairs and Employment in the Rajya
Sabha. The figures given in the above statement show that though 23 years elapsed since the
ULCRA came in force in 64 towns, no effective results could be achieved. Its dismal performance
was attributable to a plurality of reasons. Amongst them, one of the main reasons was the illusory
amount of compensation (Re 1 to Rs 10 per sq. mt.), evidencing its confiscatory nature i.e., it was
almost amounting to a fine people paid for owning excess land instead of proper reimbursement
and therefore, no feeling of coercion. The Act was penalizing people for holding excessive lands.
This is a problematic idea because land- holding is a perfectly legal right and if your title if good
then no one can question the amount being held by you. But here the state was questioning it in
the basis of public interest and taking it away for so small a compensation that it was forcing people
to not agree to their land holdings. In fact state was exploiting its position and trying to impose
charitable intentions upon people. Also the ULCRA institutionalized corruption. Sections 20/
21 were subjective in nature and allowed for exemptions under the Act and this was being utilized
by all bureaucrats to earn favors and majority of land was exempted under one pretext or another.
The repeal of the ULCRA was also necessitated to accelerate the growth rate of the housing stock.
As per the 1991 Census, 162 million households were living in 131 million usable housing stock,
indicating a backlog of about 31 million, which is to rise to 41 million in 200179. The ULCRA
froze the building activity substantially by proving to be regulatory impediments to housing and
land development30. The acquired land was outside the jurisdiction of builders and entrepreneurs
and the state itself was not doing any construction work. So the remaining land became extremely
expensive firstly, because people were not too keen on parting with it and secondly because
demand was constantly increasing, anyways. With the repeal of the ULCRA, the greater
availability of land would naturally push down the price effectively. The market forces would
govern the prices without there being artificial scarcity. The worst victims of the ULCRA were the
marginal and small farmers, who had their holdings in the peripheral areas of the urban
agglomerations. There lands were acquired for such low compensation rates that they were pushed
into lower social strata as they were technically out of work. The competent authorities also
30

Sec. 20-22 of the Act.

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misused their powers while determining excess vacant lands. The definition was ambiguous. The
exemption granted to agricultural lands was being exploited on the basis of zoning laws, as if lands
were situated there, then they couldnt be acquired, even if in reality they were actually super malls
or some other commercial set- up. The determination of excess vacant land, though theoretically
looked simple, was found to be most tedious in practice. The procedural hassles of the ULCRA
including right to appeal (vide Section 33) and the right to revision (vide Section 34) against every
order had also led to endless innings of litigation. There was no one common authority whose
orders were considered to be final. The concern for the urban poor felt by the antagonists to the
repeal can be well appreciated. But their interest can be effectively served by other means also.
One of the ways can be to legislate a special law for the shelter to the poor. In retrospect, the
Supreme Court has upheld such law. To illustrate, the Tamil Nadu Acquisition of Land for Harijan
Welfare Scheme Act, 1978 and the Tamil Nadu Slum Areas (Improvement and Clearance) Act,
1971 were upheld in the State of T.N. v. Ananthi Ammal31 though they provided lesser amount of
compensation. Other means can be by creating "shelter fund", imposing stiff taxes on vacant land,
higher rate of capital gains arising from transfer of such lands, higher stamp duty, tariff etc. From
various standpoints, the view taken by the Standing Committee as well as the decision of the
Government for the repeal reflects a well-considered policy decision, which deserves to be
commended as a pragmatic and progressive step in the right earnest. Also, Section 21 is a major
loophole that allows land owners to get exemptions on the grounds of constructing dwelling houses
and then starting construction but delaying completion, or selling them off to builders who even
though comply with the requirements, make houses which are well beyond the reach of the
marginalized sections of the society. And the compensation rates are unrealistically low, almost
amounting to fines and therefore, discouraging people from declaring excess land and therefore,
the objectives of the Act are not being fulfilled. Unless by mistake excess land was found, it was
not possible to detect it on paper. An argument often taken as a counter against repeal is to
introduce stricter rent control laws, but this works on the presumption that adequate dwelling units
are already available just not affordable, while in reality there is not enough land available to
construct more dwelling units to reduce the pressure on the available supply. Therefore, ceilings
are good and assure supply of land. But this supply is not governed by the private sector and the
red-tapism of the bureaucracy just clogs up the markets more. With the ceilings removed the
31

1995 AIR 2114.

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private sector can move in and claim these lands at adequate prices from land owners and build
cheap housing units at a considerable profit thereby achieving the objectives of the Act faster than
it could. Also, the government has hardly anything to show of the lands it acquired under the Act
and there has been little or no reconstruction for the weaker sections. Infact, the bureaucracy has
exploited these lands to earn more money by selling them off to MNCs and industrialists as the
peripheral lands are best for new set- ups. Therefore, the Act should be repealed on a cost-benefit
analysis, as a profit driven private sector will be more conscetituos than the government has been
and the government can encourage reconstruction for the poor by providing private sector
subsidies in other areas, or by offering builders FSIs in other buildings for construction of a
particular number of dwelling units. Also safety cant be sacrificed at the altar of profit and
therefore, strict checks need to be undertaken. The government should feel embarrassed and
ashamed of its own failure and now consciously undertake measures to rectify the damage it has
perpetuated for two and a half decades by allowing the poor an opportunity to live.

LAND CEILING LEGISLATION IN UTTAR PRADESH

Uttar Pradesh land ceiling laws are governed by the UP Imposition of Ceiling on Land Holdings
Act, 1960. The U P Ceilings Bill, 1959 fixes the ceiling for an individual or a family of not more
than live members at 40 acres of Fair Average Quality land. For a family of more than five, the
ceiling will be 40 acres of Fair Average Quality land plus 8 acres of such land for every additional
member of the family subject to a maximum of 24 acres. A "Family' means husband, wife,
dependent father, dependent mother, children other than married daughters and separated children,
and unseparated son's wife or widow. A child shall be deemed to be separated where the land is
recorded separately in his name or where his separate share has been declared under a family
settlement or a decree of court, etc. In determining the applicable ceiling land which but for the
transfer or area, any transfer or partition of partition would have been declared surplus land under
the provision of this Act made after the 15th August 1959 shall be ignored and not taken into
account.

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Compensation
Rates of compensation have been prescribed as follows. For holdings of:i.

Bhumidar: Forty (40) times the land revenue determined at the applicable hereditary rates,
or eighty times the land revenue payable, whichever is greater.

ii.

Sirdar: Twenty (20) times the land revenue determined at applicable hereditary rates.

iii.

Occupancy, ex-proprietary and hereditary tenants: Twenty (20) times the rent
determined at the applicable hereditary rates.

Surplus land shall vest in the State Government, free from all encumbrances. The surplus land
found after determination of ceiling area may be settled with any member or members of society,
so however that no member holds land in excess of 12 acres and the balance, if any, shall be
settled in accordance with the provisions of Sub-Section (4). This Sub-Section lays down that
surplus land in a village, if it is more than 15 acres may be settled with a registered co-operative
farming society of landless agricultural labourers; if less than 15 acres, then it should be settled
with a registered cooperative farming society of uneconomic tenure holders, i.e., persons holding
less, than 3.125 acres each.

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CONCLUSION
The object of imposing a ceiling on existing holdings as visualized in the First Five Year Plan was
to utilize the surplus land either to increase the size of the un-economic holdings or to distribute it
to the landless for co-operative cultivation. One of the immediate problems facing the country is
to increase food production and that is also the objective of land reforms as enunciated in the
Second Five Year Plan. The use of surplus land to increase the size of the un-economic holdings
is a better and more practical proposition than its distribution to the landless for cooperative
cultivation, as the efficacy of the latter is still in doubt. On the other hand, uneconomic holdings
are at the root of many of the difficulties of Indian agriculture. Agriculture cannot be developed as
an efficient industry unless the unit of management becomes much larger than it is at present". But
the Nagpur Go tigress thinks otherwise and recommends the second course of distribution of the
surplus land to the co-operatives of landless. And most of the State Governments seem to think
alike in this matter and propose to manage the surplus land through co-operatives of the landless.
U P have, however, departed from the doctrinaire approach of the Nagpur Congress and have
adopted a more practical course. In U.P. it is proposed to redistribute the surplus land among the
villagers so that no one gets more than 12 acres of land and the balance, if any is to be managed
through co-operatives of landless agricultural labourers. These august measures of land reform are
going to adorn the statute book of every State. But how much surplus land will be surrendered in
each State as a result of ceiling laws is a matter of speculation. The provisions regarding restriction
on transfers have been so loosely worded, as if by design, in almost all the bills that they are not
likely to be effective at all. The Planning Commission suggested that restrictions should be
imposed on all transfers made since 1953 to avoid ceiling, and also that all the transfers that have
already taken place should be reviewed. But none of the States have felt it necessary to act on these
lines. Thus the ceiling law will be nothing but a harmless piece of legislation to be dangled before
the parasites. As far as one can see there is little likelihood of surplus land being surrendered, or
of land being redistributed to the landless and the needy in the near future to any appreciable extent.

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