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Madhavi P.Patil
History of the Urban Land Ceiling
Act, 1976

• The Urban Land ceiling Act (ULCRA) was introduced during Prime
Minister Indira Gandhi’s 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 areas.

• 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 Urban Land (Ceiling And Regulation) Act,

ACT NO. 33 OF 1976 [ 17th February, 1976.]

• As per the Preamble of the Act:
An Act to provide for the imposition of a ceiling on vacant land in urban
agglomerations, for the acquisition of such land in excess of the ceiling limit, to
regulate the construction of buildings on such land and for matters connected
therewith, with a view to preventing the concentration of urban land in the
hands of a few persons and speculation and profiteering therein and with a view
to bringing about an equitable distribution of land in urban agglomerations to sub
serve the common good.

Major Provisions of the Act
• The ULCRA was enacted by the Government of India and came into force on
17February 1976 simultaneously in 11 states of India: Andhra Pradesh,
Gujarat,Haryana, Himachal Pradesh, Karnataka, Maharastra, Orissa, Punjab, Tripura.Uttar
Pradesh and West Bengal, and all the Union Territories.

• The Act had been made applicable to all cities with a population of 0.3 million and
above and in a few other smaller cities which have had high growth rates. Significantly, the
Act was applied not just to the city but the city agglomeration, generally identified by a 5
km belt around the city and within which the conflict between prime agricultural land and
future urbanisation is most prominent.
Objectives of the Act
• The basic objectives of this Act, were to ensure orderly urban development, to
check speculation and price escalation in land, and to promote the production
of low income housing.
• These objectives were to be implemented through:
• (1) imposition of a ceiling on the vacant land holdings of individuals or companies;
• (2) limiting the size (in terms of plinth area) of the dwelling units to be built in the future
on lots; and
• (3) regulating the transfer of urban property.

• A separate department known as the "competent authority" is set up to implement the
Act. The competent authority is vested with all powers of the civil court.
Ceiling limit.
• Subject to the other provisions of
this section, in the case of every
person, the ceiling limit shall be,-

• For category A areas, peripheral
area is 8 kms., for category B areas
and category C areas its 5 kms and
its 1 km for category D areas.
Land Ceiling Limits
Class B
Class C Class D
Class A
• Class A (Delhi, Bombay, Calcutta,
Madras) -500 sq. m;
• Class B (Cities with a population
of over a million, e.g. Bangalore,
Hyderabad, Ahmedabad,
Kanpurand Pune) - 1,000 sq. m;
• Class C (Cities with a population of
0.3 to 1 million)- 1,500 sq. m;
• Class D (Smaller cities with a
population of 2-300,000) -
2,000sq. m.

Important sections of ULCRA-1976
Some of the most important provisions of the Urban Land (Ceiling and Regulation) Act, 1976 are:
• Section 6: Filing of statement by persons holding vacant land in excess of the ceiling limit.
• Section 6(1): Liability to file statement before CA for all vacant land & other ceiling limit.
• Section 6(2): Issue of notice upon a person directing him to file statement of his holding as referred to in sub-
section (1).
• Section 8: Preparation of draft statement as regards vacant land held in excess of ceiling limit.
• Section 9: Preparation of final statement as regards vacant land in excess of ceiling limit.
• Section 10: Acquisition of vacant land in excess of ceiling limit.
• Section 10(1): Issue of Notification in respect of particulars of vacant land held by the person in excess of the
ceiling limit as shown .
• Section 10(3): Declaration by the CA that the excess vacant land referred to in the Notification published
under sub-section (1) be deemed to have been acquired by the State Govt.
• Section 10(5): Taking over possession of Govt. land vested under sub-section (3), by the person authorised by
the CA within stipulated period as provided in this sub-section.
• Section 11: Payment of compensation for vacant land acquired.
• Section 20: Exemption of certain category of vacant land from the preview of the Act — power of the State
• Section 22: Retention of vacant land emergency upon destruction or demolition of any holding or any holding
or any for redevelopment in accordance with the master plan furnished by the applicant/returnee.
• Section 26: Notice to be given before transfer of vacant lands.
• Section 27: Prohibition on transfer of urban property.
• Section 29: Regulation on construction of building with dwelling units (certain restriction imposed).
• The compensation payable for the excess land is fixed at 8.3 times the net average annual income
from land, if any, derived during the preceding 5 consecutive years (Section 11). In case no income was
derived from such land, the government could fix a price taking into account various factors
such as location, price of land in the past 20 years and so on. For this purpose, the state
government would divide the urban agglomeration into various zones and fix the rate per sq. m of vacant
land in each zone; but the rates are not to exceed Rs. 10 per sq. m for categories A and B, and
Rs. 5 per sq. M for categories C and D cities.
• In Ahmedabad, for example, the rates of compensation varied between 50 paise to Rs. 10 per sq. m for
land in various zones (Wadhva, 1983, p. 77).
• The Act specifies a cash compensation to the tune of 25% of total compensation, subject to a
ceiling of Rs. 25,000, and the rest in negotiable bonds redeemable after 20 years but
carrying an annual interest of 5% (Section 14).The land, thus acquired, can be disposed of in any
manner at the discretion of the state government (Section 23). The state could also reserve this land for
public benefit or for some future use.
Limitations due to Master Plans
• After the circulation of Model Town and Country Planning Act, 1961 by the national
government, the state governments initiated activities to prepare master plans for the
development of urban areas under their jurisdictions. So far, more than 575
conventional master plans have been prepared, of which only a few have been
implemented. But unless the Master Plan of a city declares any land as vacant land. It is not
treated as such by the urban Land (Ceiling and Regulation) Act of 1976. Consequently, a
substantial part of land, which is used for agricultural purposes in many cities,
gets exempted from the provisions of the Act. Exemptions are also granted to
those pieces of land where construction of buildings is prohibited by the
master plan. This provision of the Act is inconsistent in the sense that not many master
plans have legal backing. But under this provision. lands designated for utility networks
and social services will have to be acquired under different laws and Acts.
Jurisdictional limitations
• Although the Act is applied not just to the city but also to the city
agglomeration generally identified by a 5 km belt around the city,
there are some jurisdictional limitations on the applicability of this
• The problem arises in respect of peripheral areas or urban
agglomerations in one state which fall within the
boundaries of another state. For example. this Act excluded
peripheral areas of Delhi agglomerations which fell within the
boundaries of Haryana.
• Another consequence of this jurisdictional concern is that the Act
appears to be causing large distortions in the physical
development of cities. Land is developed outside the ULCRA
limits because closer land is not available.
• Furthermore, the pursuance of a growth centre strategy by the
urban development authorities maybe for a need to be outside the
limits of the Act where land can be acquired (for example, the Draft
Development Plan of the Ahmadabad Urban Development
Authority calls for the development of 4 growth centres in its
jurisdictional area at Kalol, Sanand, Dehgam and Mlehmdabad;
Shape of the vacant land
• There is a practical difficulty relating
to the shape of the vacant land which
would be available to the government. The
Act gives the option to the landowner to
decide upon the shape, dimensions and the
relative location of the plot which he could
retain within the ceiling limits.
• The landowner is thus in a position to
leave with the government excess
land in a shape which may be difficult
for building construction.
Consequences of densification
• As the Act encourages fragmentation of vacant land in excess of the
ceiling, it will also affect the existing densities in built-up areas. This
may have both the positive as well as negative effects on the
community as a whole.
• The positive result is obtained if the development leads to achieving
an optimum density through densification.
• But the negative results such as overcrowding, traffic congestion.
lack of open space, and burden on the already overloaded urban
services are likely to overweigh the positive results.
The Urban Land ( Ceiling and Regulation ) Repeal Act
1999 [22nd march 1999]
• 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 ha75. Of estimated excess vacant land, 50,046
ha. Of vacant land vested in the State Governments76. 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 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.
• With the repeal of the ULCRA, the greater availability of land would naturally push
down the price effectively.
• The competent authorities also misused their powers while determining excess
vacant lands.
• 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.
The Urban Land ( Ceiling and Regulation ) Repeal Act
1999 [22nd march 1999]

An Act to repeal the Urban Land (Ceiling and Regulation ) Act 1976.
Be it enacted by Parliament in the Fiftieth Year of the Republic of India as

Short title, application and commencement.
• This Act may be called the Urban Land (Ceiling and Regulation) Repeal Act, 1999.
• It applies in the first instance to the whole of the States of Haryana and Punjab and to all
the Union territories; and it shall apply to such other State which adopts this Act by
resolution passed in that behalf under clause (2) of article 252 of the Constitution.

• It shall be deemed to have come into force in the States of Haryana and Punjab and in all
the Union territories on the 11th day of January, 1999 and in any other State which adopts
this Act under clause (2) of article 252 of the Constitution on the date of such adoption; and
the reference to repeal of the Urban Land (Ceiling and Regulation) Act, 1976 shall, in
relation to any State or Union territory, mean the date on which this Act comes into force in
such State or Union territory.
• Repeal of Act 33 of 1976
The Urban Land (Ceiling and Regulation) Act, 1976 (hereinafter referred to as the principal
Act) is hereby repealed.
Provisions of the Repeal ULCA Act-1999
The repeal of the principal Act shall not affect-
• (a) 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
in this behalf or by the competent authority;
• (b) the validity of any order granting exemption under sub-section (1) of section 20 or any action
taken there under, notwithstanding any judgment of any court to the contrary;
• (c) any payment made to the State Government as a condition for granting exemption under sub-
section (1) of section 20.
• (a) 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 in this behalf or by the competent authority;
• (b) 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.

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