Haryana Government Centralizes Municipal Land Sale Revenue to Prevent Fund Misuse
The Haryana government has implemented a significant policy shift by centralizing the handling of proceeds earned from the sale of municipal land and revenue roads across the state. Under this new system, revenue from all urban local bodies (ULBs) will be deposited into a single bank account controlled by the directorate, rather than remaining with individual civic bodies as was previously the practice.
New Centralized Accounting System
Separate ledgers will be meticulously maintained for each municipality to accurately record the amount contributed by each city. Officials have emphasized that this move is specifically designed to prevent misuse of funds at the local level and ensure that accumulated money is later allocated for major infrastructure and revenue-generating projects within the same city. Such projects may include commercial complexes, parking facilities, and modern markets.
Policy Amendments and Implementation
The decision follows amendments to the state land rate policy, which was first notified on November 25, 2021. Clause 5(3)(c) of the policy was revised on June 27, 2025, explicitly allowing for the centralized handling of income from land sales. The department has issued strict instructions to officials to comply with the order and maintain detailed records of all property transactions.
The official order states: "The amount collected from the sale of municipal land or surplus revenue road shall be deposited into a centralized bank account managed at the directorate level. The directorate will maintain a detailed ledger tracking land sales on a municipality-wise basis. Once sufficient funds are accumulated, the amount will be allocated to the respective municipalities for the creation of revenue-generating assets within those jurisdictions."
Financial Impact in Urban Centers
This policy is expected to have the greatest financial impact in high-value urban centers such as Gurgaon, where municipal land commands premium prices. Until now, if a municipal corporation sold land to private buyers or developers, the proceeds were retained in its own account. This practice has now been officially discontinued.
Gurgaon's Land Sale Context
MCG records reveal that several parcels of revenue road land have already been sold to private developers. In 2024, eight private builders approached the corporation to purchase revenue road land falling within their housing societies in sectors 63A, 65, 106, 111, and 113.
In the current financial year, the corporation has estimated an income of Rs 5 crore from the sale of municipal land. In the previous financial year, it earned Rs 3.4 crore from such sales. Although the revenue last year was limited, the corporation had in earlier years sold land to private builders valued at several crores.
Historical Context of Revenue Roads
According to corporation data, in 2018 builders encroached on more than 26 acres of government revenue road land. Officials noted that encroachment cases have since increased, with more than 25 builders applying to purchase such road land from the corporation. Revenue roads were originally created as access paths to agricultural fields in village areas. They came under the jurisdiction of municipal corporations after licensed colonies were developed.
