Mumbai: In a relief to renewable energy developers, the Maharashtra government has decided to waive the 25% land transfer fee levied when land acquired for projects such as solar and wind power is transferred from a parent company to its project-specific subsidiary.
Decision Aims To Boost Investment
The decision, taken by Revenue Minister Chandrashekhar Bawankule on the directions of Chief Minister Devendra Fadnavis, is aimed at reducing project costs and facilitating investments in the state's renewable energy sector.
Under the Maharashtra Tenancy and Agricultural Lands Act, companies acquiring land for industrial purposes were required to pay a transfer fee equivalent to 25% of the land's market value, calculated on the basis of ready reckoner rates, to the district collector when transferring the land.
High Transfer Costs Delayed Projects
Renewable energy companies often transfer land to separate subsidiaries to secure bank loans or attract foreign investment. Although such transfers may involve no change in ownership and are largely internal corporate arrangements, the 25% fee significantly increased project costs and, in some cases, delayed the development of energy projects.
The government has now decided to waive the fee in line with the decision taken at the state Cabinet meeting on August 18, 2026.
However, the exemption comes with a condition that the land must be used exclusively for renewable energy development. If a company benefiting from the waiver subsequently uses the land for residential, commercial or any other purpose, or sells it to a third party, the exemption will be withdrawn. The government will recover the entire transfer fee along with interest.
Bawankule said the decision would eliminate the additional financial burden on companies, reduce project expenditure and encourage large-scale investments in Maharashtra's green energy sector.
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