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Rajasthan notifies new rules for rural land use conversion: Instant permission, self-assessed premium and deferred scrutiny
The Government of Rajasthan, Revenue (Group-6) Department, on September 29, 2026, notified the Rajasthan Land Revenue (Use of Agricultural Land for Non-agricultural Purposes in Rural Areas) Rules, 2026 (“2026 Rules”) under Section 261(2)(xi-A) read with Section 90-A of the Rajasthan Land Revenue Act, 1956.
From November 2, 2026, the 2026 Rules replace the Rajasthan Land Revenue (Conversion of Agricultural Land for Non-agricultural Purposes in Rural Areas) Rules, 2007 (“2007 Rules”) and do away with waiting for an officer’s approval. Permission is system-generated on the portal the moment an applicant files a complete online application and pays the self-assessed premium. The Sub-Divisional Officer (“SDO”) remains the sole competent authority. However, permission is now verified after it is issued, rather than before. This speeds up the process but also increases the risk of non-compliance. Use of land without permission attracts a penalty of 4 (four) times the applicable premium. Further, the intimation-only route previously available to renewable energy projects under the 2007 Rules has been withdrawn.
With permission now granted first and checked later, what does this mean for landholders and developers?
Background
For nearly 2 (two) decades, the 2007 Rules have governed the use of agricultural land held by khatedar tenants in rural Rajasthan for non-agricultural purposes. Successive amendments during this period created a layered framework in which the competent authority depended on both the proposed use and the area involved. The tehsildar decided small residential units, while larger residential colonies and commercial, industrial and food processing projects moved progressively up the hierarchy to the SDO, the Collector, the Divisional Commissioner and, ultimately, the State Government. Timelines, in turn, were linked to payment; once the applicant deposited the balance of the conversion charges, the authority had to issue the conversion order within 15 (fifteen) days, with a tatkal (expedited) option available for an additional fee. Running alongside this process were routes that dispensed with a conversion order altogether. Rule 6B allowed a khatedar tenant to use land for renewable energy projects merely by giving 30 (thirty) days’ prior intimation to the tehsildar and the Rajasthan Renewable Energy Corporation. The khatedar could similarly set up food processing units on their own land, up to a prescribed area, without conversion.
The result was a fragmented process in which applicants had to identify the correct authority, track differing timelines and navigate parallel routes depending on the intended use. The 2026 Rules seek to replace this patchwork with a single, portal-based regime, effective from November 2, 2026. They repeal the 2007 Rules and aim to simplify the use of agricultural land for non-agricultural purposes in rural areas and reduce unnecessary delays. The transition, however, is protected by a saving clause. The repeal does not affect any order made, action taken, right or liability accrued, or enquiry or proceeding initiated under the 2007 Rules. Accordingly, an existing conversion order already issued remains valid and need not be obtained again. The charges that are already paid and penalties that are already incurred will not be reopened. Further, any application pending on November 2, 2026, will continue to be processed under the 2007 Rules.
Key provisions of the 2026 Rules
Permission replaces conversion
Under the 2007 Rules, a landholder seeking to use agricultural land for a non-agricultural purpose was required to obtain a conversion order. Once the prescribed authority issued the order, the tehsildar updated the revenue records by deducting the converted area from the landholder’s khatedari land and recording it as non-agricultural land in the Jamabandi. As a result, the converted area was removed from the landholder’s agricultural holding in the revenue records.
The 2026 Rules no longer use the concept of ‘conversion’. Instead, the SDO issues a ‘Non-Agricultural Land Use Order’ authorising the use of the land for the specified non-agricultural purpose. Rule 8 of the 2026 Rules expressly provides that this does not affect the landholder’s title to the land. The revenue records are still updated, but the process is now automatic. 1 (one) month after the order is issued, mutation entries are made and the land classification is changed under Rule 13 of the 2026 Rules, without requiring a separate order from the tehsildar.
Single authority and automatic permission
The SDO now decides all applications for permission to use agricultural land for non-agricultural purposes, as well as applications for a change in purpose. Applicants will be required to file Form-A on a unified online portal, which the State Government is yet to establish, together with proof of the self-assessed premium and a non-refundable application fee. The fee ranges from INR 2,000 (Indian Rupees two thousand) for a residential unit to INR 20,000 (Indian Rupees twenty thousand) for other purposes. Once a complete application is filed, the portal generates the permission in Form-B automatically, without any discretionary review. This removes decision-making delays but places the burden of accuracy squarely on the applicant, who must also make good any shortfall in the premium.
District Level Committee-linked premium
Schedule-2 of the 2026 Rules fixes the premium solely as a percentage of the rates recommended by the District Level Committee (“DLC Rates”), as follows:
- 5% for residential units, public utility, industrial uses and stadiums;
- 10% for commercial, institutional, residential colony, medical, hydrocarbon exploration and integrated township uses;
- 5% for food processing; and
- 5% for renewable energy projects and salt manufacturing.
By contrast, the 2007 Rules charged the highest of a per square metre rate, a percentage of the DLC Rates or a percentage of the sale-deed price and charged residential colonies at 7.5%. The new single-metric approach cuts both ways. The colony developers will pay more, as the rate rises from 7.5% to 10%, while purchasers who paid above the DLC Rates may pay less, as the sale-deed price is no longer relevant.
Post-permission audit and lock-in
Automatic permission does not mean unchecked permission. The SDO must verify the facts and documents within 1 (one) month of the order and may cancel an order obtained by fraud, with a penalty of 2 (two) times the premium. During that month, no party may create third-party rights in the land. Purchasers and lenders should accordingly schedule sale deeds and mortgages after this window closes.
Stricter enforcement
The 2026 Rules also strengthen on-ground monitoring. The Patwari must survey land use at least 2 (two) times a year and report violations in Form-E, following which the SDO levies a penalty of 4 (four) times the premium. In contrast, the 2007 Rules regularised an unauthorised change of purpose at 25% of the conversion charges, so the cost of non-compliance has risen sharply.
Other changes
The 2026 Rules also: (a) list 18 (eighteen) categories of restricted land in Schedule-1; (b) permit reversion of land to agricultural use, without refund of the premium; (c) provide an online appeal to the Collector within 30 (thirty) days, on deposit of 50% of the disputed premium; and (d) cap a residential unit at 1,000 (one thousand) square metres, against 4,000 (four thousand) square metres under the 2007 Rules.
End of the intimation route for renewable energy
Rule 6B of the 2007 Rules allowed a khatedar tenant to use or sublet land for solar, wind, biomass, biogas and Bio-CNG/CBG projects without obtaining a conversion order. The khatedar tenant only had to inform the tehsildar and the Rajasthan Renewable Energy Corporation in Form-E 30 (thirty) days before the intended use, after which the tehsildar noted the use in the jamabandi, and the land continued to remain agricultural khatedari. Importantly, this route did not require the payment of any conversion charges.
The 2026 Rules omit this route completely. Renewable energy projects now fall within the listed non-agricultural purposes and require a permission in Form-A, along with a payment of premium of 0.5% of the DLC Rates and an application fee of INR 20,000 (Indian Rupees twenty thousand). The only exemption from premium applies where the land belongs to a scheduled caste or scheduled tribe khatedar tenant. As a result, developers who previously set up renewable energy plants on khatedari land without any conversion cost will now need to factor the premium and application fee into their project costs.
Conclusion
The 2026 Rules bring long-awaited simplicity to rural land use in Rajasthan by replacing a tiered, discretionary process with a single, portal-based permission administered by the SDO. For landholders and developers, automatic permission and a uniform DLC-linked premium substantially reduce approval timelines and uncertainty. At the same time, the 2026 Rules shift the risk of error to the applicant and bring uses that earlier required no conversion within the permission regime.
More broadly, the 2026 Rules signal a policy shift from approval-based control towards self-certification backed by post-facto scrutiny, which the State Government appears to regard as more efficient for rural development. The streamlined front end is, however, matched by a more stringent back end. Landholders and developers should treat the filing as a compliance exercise, supported by proper diligence on DLC Rates, land category and intended use, rather than as a routine formality.
Key issues
- Transition: The 2026 Rules apply from November 2, 2026; conversion orders under the 2007 Rules remain valid, and pending applications will be decided under the 2007 Rules.
- Premium: The premium is solely a percentage of the DLC Rates (5%, 10%, 2.5% or 0.5% depending on use), the sale-deed price is no longer relevant, and land of Scheduled Caste or Scheduled Tribe khatedar tenants is exempt.
- Incorrect self-certification: The applicant must pay for any premium shortfall. The SDO may cancel a permission obtained by fraud, concealment, forged documents or a false declaration under Rule 14 of the 2026 Rules, with a penalty of 2 (two) times the premium. Continued use attracts a further 4 (four) times the premium under Rule 7 of the 2026 Rules and requires a fresh application.
- Enforcement: The Patwari surveys land use at least 2 (two) times a year and use without permission attracts a penalty of 4 (four) times the premium, against regularisation at 25% of the conversion charges under the 2007 Rules.
- Implementation: The unified online portal has not yet been established, so the system’s readiness by November 2, 2026, remains to be seen.
Key takeaways
- Treat filing as compliance: Verify DLC Rates, Schedule-1 status, land category and intended use before filing Form-A, since the Form-B permission issues automatically and errors surface only at the audit.
- Time transactions around the audit: No third-party rights may be created during the 1 (one) month audit window, so purchasers and lenders should schedule sale deeds and mortgages after it closes and confirm that the permission has survived the audit.
- Title and remedies: Rule 8 of the 2026 Rules preserves the landholder’s title. Mutation follows automatically after 1 (one) month. An appeal may be filed online before the Collector within 30 (thirty) days, subject to depositing 50% of the disputed premium. The land may also revert to agricultural use without refund.
Sectoral impact
- Renewable energy: With the Rule 6B intimation route withdrawn, projects on khatedari land now need a Form-A permission, a premium of 0.5% of the DLC Rates and a fee of INR 20,000 (Indian Rupees twenty thousand). A material new cost for land-intensive solar and wind parks should be factored into budgets, bid tariffs and land arrangements.
- Food processing: Units that a khatedar could earlier set up on their own land without conversion now attract a premium of 2.5% of the DLC Rates plus the application fee.
- Real estate, industrial and commercial: Colony developers pay more (10% of the DLC Rates under the 2026 Rules against 7.5% of the DLC Rates under the 2007 Rules). The 2026 Rules also cap residential units at 1,000 (one thousand) square metres, against 4,000 (four thousand) square metres under the 2007 Rules. Industrial and commercial projects gain most from a single, SDO-led process.
This Prism has been prepared by:
M. Arun Kumar | Bhavesh Gupta | Devanshi Bhatia
For more details, please contact km@jsalaw.com.
