Maharashtra Lifts Ban on State Land Allotment to Housing Societies

Maharashtra has lifted its decade-long freeze on allotting state-owned land to cooperative housing societies, opening the process to new societies under a revised policy that includes social reservations and a transparent auction mechanism.

According to ETRealty, citing PTI, the state had suspended allotments to new cooperative housing societies after a controversy in 2010. The government had previously allotted land under resolutions issued in 1999 and 2007.

Under the revised policy, at least 20% of members in every housing society receiving government land must belong to backward classes, while 5% must be persons with disabilities, Revenue Minister Chandrashekhar Bawankule said on Wednesday.

The method of allotment has also changed. Government plots will no longer be distributed through the earlier lottery system. District collectors will identify available plots and invite bids through public advertisements, followed by technical and financial evaluation. The society offering the highest bid will be selected.

The base price will be set at 2.5% of the land's market value in Mumbai city and its suburbs, and 5% in the rest of Maharashtra. Land will be allotted on a 30-year lease and can be converted to Class-I occupancy only after the lease period is completed.

The policy also sets aside portions of available plots for several categories. Forty per cent will be reserved for the general category, while 15% will be allocated to state government, local body and corporation employees. Another 10% will be reserved for Scheduled Castes, Scheduled Tribes and nomadic tribes, and 10% for writers, artists, sportspersons and journalists.

Five per cent allocations have also been earmarked for Central government employees, serving and former armed forces personnel, elected and former MPs and MLAs, freedom fighters and their heirs, persons with disabilities, and economically weaker sections.

The government has revised income limits and carpet-area eligibility in line with the Seventh Pay Commission. Group-D employees will be eligible for flats of up to 300 sq ft, subject to a monthly income limit of Rs 50,000. Group-C employees can qualify for up to 450 sq ft with monthly income between Rs 50,001 and Rs 1 lakh. The limits rise to 650 sq ft for eligible Group-B employees, while Group-A employees can receive up to 1,076 sq ft without an income ceiling.

The new policy also introduces tighter controls on ownership and transfers. Husband and wife will have to hold joint membership in societies allotted government land. District collectors will have powers to take over dummy or benami flats without compensation. Prior approval will be required before a flat is transferred, mortgaged for a bank loan or taken up for redevelopment.

Bawankule said the revised system would make government land-based housing accessible to thousands of government employees, journalists, artists, members of backward communities and other citizens.

The policy was prepared following a petition by the Sanjay Gandhi Cooperative Housing Society in Kolhapur before the High Court and observations made by the Supreme Court on November 25, 2024, according to ETRealty's report.