Kerala all set to launch One Time Settlement scheme to recover ₹700 cr land lease arrears

Thiruvananthapuram: The Kerala Revenue Department will soon announce a one-time settlement scheme to recover over ₹700 crore in outstanding lease arrears from government-owned land.

According to sources, the scheme will likely offer discounts ranging from 25% to 50% on the total outstanding dues. This scheme, however, will not apply to large-scale plantations leased prior to the formation of the state of Kerala.

The Revenue Department estimated the lease arrears in November this year at ₹665.30 crore across 584 cases. This figure, however, has since increased. Government land has been leased to a diverse range of entities, including individuals, industrial firms, socio-cultural organisations, cooperative societies, aided/medical institutions, public sector undertakings, local bodies, and libraries.

Records indicate that land has been leased for purposes ranging from agriculture to the establishment of foreign liquor outlets. Annual lease rates are currently fixed between 0.5% and 5% of the land's market value. But with the surge in real estate prices,  many lessees have found these market-linked rates unsustainable, leading to a massive accumulation of dues. The Comptroller and Auditor General (CAG) has repeatedly highlighted the failure to recover these arrears in its previous reports.

Land is leased under the Land Assignment Rules of 1964 for rural areas and the Rules of 1995 for urban areas. Under these rules, the lease for the first year should be paid in advance to secure the land. Subsequently, payments must be made before April 30 of each year. Failure to meet this deadline attracts interest, while the regulations also mandate that a notice be issued, and continued default can result in the cancellation of the lease.

Ernakulam leads in arrears
While Ernakulam district holds the highest total amount of unpaid arrears, Idukki district has the highest volume of individual cases at 256 (totalling ₹6 lakhs in dues).

District     -    number of cases  -  amount owed

Ernakulam  -             60               -    ₹280 cr

Thrissur      -                15            -    ₹201.3 cr

Thiruvananthapuram-    157      -     ₹104.7 cr