Andhra Pradesh High Court Orders Formation Of Apex Committee To Recover Agricultural Land Conversion Tax Dues

The Andhra Pradesh High Court has recently directed the State's Chief Secretary to constitute an Apex Committee to identify defaulters and recover unpaid conversion tax dues under the Andhra Pradesh Agricultural Land (Conversion for Non-Agricultural Purposes) Act, 2006.

A Division Bench of Chief Justice Dhiraj Singh Thakur and Justice Challa Gunaranjan ordered, “… we feel that steps have to be taken for ensuring recovery of the outstanding tax. We, therefore, direct the Chief Secretary of the State of Andhra Pradesh to constitute an Apex Committee which would include the Principal Secretary of the Revenue department to draw a list of defaulters who have not paid the conversion tax based upon data from various Districts. Steps be then taken for recovering the tax by following the procedure as is otherwise prescribed under the Act of 2006 as also the Rules of 2018.”

The directions came while hearing a Public Interest Litigation filed by A.P. United Forum for RTI Campaign. The petition alleges large-scale failure by authorities to collect statutory conversion charges from landowners who put agricultural land to non-agricultural use without paying the mandated levy.

Under the 2006 Act, agricultural land cannot be used for non-agricultural purposes without prior permission and payment of conversion tax.

The petitioner informed the Court that a list of defaulters has already been identified. Some of them have been impleaded as party respondents. It was stated that Rs.167.52 crore remains outstanding from one zone of Vijayawada North alone. The petitioner described this as “only a tip of the iceberg,” and alleged similar lapses across other districts.

The court noted that although an affidavit had been filed by the authorities. it did not disclose details regarding the number of defaulters across the State.

Authorities submitted that the 2006 Act has been repealed by Andhra Pradesh Ordinance No.5 of 2025, published in the Gazette on September 3, 2025. However, the bench observed that “the liability may still continue insofar as the period prior to the issuance of the Ordinance is concerned.”

The court also recorded that a show cause notice issued to one of the respondents has been challenged before a single judge and remains pending.

Clarifying the scope of recovery, the bench said, “We make it clear that such of the lands which are otherwise covered under Section 7 of the Act of 2006 may not strictly fall within the ambit of the Act of 2006 for purposes of collection of tax.”

The court directed that an action taken report be submitted before the next date of hearing.

The matter is listed for May 6, 2026.