In a significant development that could reshape land transactions across Himachal Pradesh, Revenue Minister Jagat Singh Negi on Tuesday introduced the Himachal Pradesh Tenancy and Land Reforms (Amendment) Bill 2025 in the state assembly.
The proposed amendments to Section 118 of the 1972 Act—one of the most critical and debated land laws in the state—aim to balance the protection of agricultural land with modern economic needs. The bill has sparked immediate attention as Section 118 has been the backbone of land ownership regulations in Himachal for over five decades.
WHY SECTION 118 MATTERS
Section 118 has been Himachal Pradesh’s primary safeguard preventing unrestricted land sales to non-agriculturists, protecting the state’s limited agricultural land and preventing large-scale land grab by outsiders. Any amendment to this section directly impacts land ownership, real estate development, and the rights of local farmers.
GAME-CHANGING PROVISIONS
1. 10-year lease freedom in rural areas
In what could be a major boost for rural entrepreneurship, buildings or portions of buildings in rural areas can now be leased for commercial activities for up to 10 years without Section 118 permission. This means:
- No bureaucratic clearance needed for rural business rentals
- Small businesses, startups, and shops can operate freely
- Rural tourism ventures will face fewer barriers
- Non-agriculturists can legally rent commercial spaces for a decade
2. RERA projects get blanket exemption
Non-agriculturists purchasing flats or buildings up to 500 square meters from RERA-registered projects for residential use will no longer need Section 118 permission. This exemption applies to all future buyers as well—a significant departure from current practice.
3. Himuda and TCP buyers’ heirs protected
Previously, only the original buyer from HIMUDA or TCP schemes was exempt from Section 118. Now, all subsequent buyers and legal heirs will enjoy the same exemption, resolving a long-standing issue affecting thousands of property owners.
4. Agricultural cooperatives empowered
Cooperative societies with 100% agriculturist members can now purchase land, provided they maintain strict farmer-only membership. Any violation results in the land automatically vesting with the state government—a strong deterrent against misuse.
5. Extension provisions introduced
For the first time, the government will have the power to grant extensions beyond the mandatory three-year land utilization period:
- Initial extension: Up to 2 years
- Further extensions: One year at a time, totaling up to 5 years
- Penalty: Based on percentage of land value
- Consequence of non-compliance: Land vests with government free of cost
6. Government acquisition projects clarified
Land acquired by government bodies under the Land Acquisition Act 2013 will be clearly exempt from Section 118 restrictions, removing previous ambiguity.
WHAT THE CHIEF MINISTER SAYS
CM Sukhvinder Singh Sukhu emphasized that the amendments are not drastic but address practical challenges. “If someone has completed 70 percent work within five years, there was no provision to grant extensions. This bill gives the government that power, with appropriate penalties,” he explained.
The CM stressed that the core spirit of Section 118—protecting local farmers’ land and state interests—remains intact while introducing flexibility for modern economic activities.
NEXT STEPS
The bill will be taken up for detailed discussion in the coming days before being put to vote. Given the sensitivity and far-reaching implications of Section 118, the debate is expected to be intense, with opposition parties likely to scrutinize every clause.
This amendment represents one of the most significant changes to Himachal’s land laws in recent years and will be closely watched by farmers, businesses, real estate developers, and citizens across the state.
