How to Convert a Leasehold Property to Freehold in India

Converting leasehold property into freehold gives the owner full title and control over the land and removes recurring ground-rent/lease obligations. The process and cost vary widely by the authority that granted the lease (for example, DDA/land-owning agencies in Delhi, municipal or state authorities in Maharashtra, Jaipur Development Authority, MCGM in Mumbai), but the basic steps, documents, charges and risks are similar. This guide explains the legal route, the typical costs and timelines, state differences with concrete examples, and practical tips, all backed by official sources and recent reporting.

What Does “Conversion” Mean?

Conversion changes the legal tenure from a lease (a right to possess for a fixed period under conditions) to freehold (outright ownership of the land). Freehold status:

• Removes periodic ground rent or renewal uncertainty.
• Simplifies resale, lending, and transfer.
• May require a one-time conversion premium and statutory formalities.

Which properties can be converted, and under what terms, depends on the lease deed and the land authority (for example the Delhi Development Authority (DDA), municipal corporations, state land departments). See DDA’s conversion brochure for Delhi examples.

Quick facts from recent policy changes (2024-2026)

• Delhi: DDA runs specific conversion schemes for its leasehold flats; applicants follow published forms and pay conversion charges according to DDA schedules. DDA periodically updates circle rates used to calculate conversion fees, councils and notices in 2025-26 affected charges.
• Maharashtra: The state issued rules (2019) and notifications in 2024-25 allowing conversion of leasehold and Occupancy Class II lands to freehold, often at a capped premium (examples reporting up to 25% of Annual Statement Rate / Ready Reckoner for some categories). Variants and special schemes (e.g., concessions for particular groups) exist.
• Many cities and authorities (Jaipur Development Authority, MCGM, etc.) now provide online application and digital workflows for conversion; charges and processes are published on their portals.

Eligibility For Conversion

Eligibility is defined in the original lease deed and the authority’s conversion scheme. Typical eligible applicants include:

• Individual leaseholders and allottees named in the lease/conveyance.
• Cooperative housing societies formed by leaseholders (often eligible as a society).
• Allottees of industrial or commercial plots where the authority’s conversion brochure permits conversion.

If the lease was a licence or a private lease from a private landlord (not a government authority), conversion effectively requires the landowner’s consent and a negotiated conveyance/settlement.

Step-By-Step Conversion Process

1. Check the lease deed and authority rules
   Confirm the land authority named in the lease, the lease terms (term, renewal clauses, reversionary rights), and whether the authority has an active conversion scheme. For statutory authorities (DDA, MCGM, JDA, state housing boards), conversion schemes, forms and checklists are usually on their websites.
2. Obtain a certified title and dues statement
   Get a search report/title search showing the chain of allotment, the original lease or conveyance deed, and a certificate of no-due (clearance of ground rent, property tax, maintenance, penalties). Authorities normally require that all dues are cleared before conversion.
3. Apply to the concerned authority (online or offline)
   Submit the conversion application in the prescribed format with documents (lease deed, identity, society resolution if applicable, tax receipts, layout plan, NOC from other departments where required). Many authorities have digitised the form submission; use the authority portal (DDA, MCGM, JDA).
4. Authority scrutiny and demand notice
   The authority will examine the file and raise a demand for conversion charges (calculated per the authority’s formula, see next section). They may also seek additional documents or rectify defects. Typical timeframes vary; Delhi’s DDA scheme aims for an in-principle decision within weeks to months depending on workload.
5. Payment of conversion charges & stamp duty
   Pay the conversion premium/charges to the authority. Separately, stamp duty and registration charges apply when executing the conveyance deed converting the title. Stamp duty rates vary by state (for example, Delhi has set percentages for conversion registration duty); check state revenue websites.
6. Execution of conveyance deed / deed of release
   After receipt of payment the authority executes a conveyance or release document transferring freehold rights (or amending the lease) and issues a no-objection / conversion certificate. The conveyance deed is stamped and registered at the sub-registrar.
7. Mutation and land records update
   After registration, apply for mutation in municipal records/property tax records to reflect the new status. This updates the revenue/civic records and ensures future property tax and title searches show freehold ownership.

How Conversion Charges Are Calculated?

Conversion formulas differ by authority. Two representative examples:

• Delhi (DDA flats / DDA land): DDA publishes an Annexure list of one-time conversion charges and allows staggered payments under certain conditions. The conversion charge uses land/plot area, circle rates, and schedule multipliers. Applicants should consult the DDA brochure and zone office for exact calculation.
• Maharashtra (state rule example): Maharashtra’s 2019 Rules and 2025 notifications allow conversion of leasehold / Occupancy Class II to freehold by paying a premium often expressed as a percentage of Annual Statement Rate (ASR) or Ready Reckoner (RR), public reporting cites up to 25% of ASR/RR for residential cases in generic notifications; categories (societies, refugees, commercial plots) may have different caps or concessions. Always verify the latest notification on the state revenue / municipal website.

Important: conversion charges can vary from a few percent of land value to much higher amounts (particularly for commercial plots or older low-premium leases), because authorities may factor historical premiums, reversionary rights, policy choices, or past consideration received.

Other Fees & Taxes to Budget for

• Conversion premium / charges payable to the lessor authority. (Varies by state/authority.)
• Stamp duty and registration fees for the conveyance deed (state government rates; e.g., Delhi lists conversion duty rules).
• Professional costs: lawyer fees for title search/drafting, architect survey charges, notary fees.
• Clearance of arrears: outstanding property tax, ground rent, or penalties must be cleared.

Typical timelines

• Simple cases (authority online schemes, complete documents): 1-3 months (scrutiny, demand, payment, registration). DDA aims for decisions within set windows but practical timelines can extend.
• Complex cases (historical leases, disputed title, large commercial plots): 6 months-2 years (additional clearances, litigation risk).

Practical examples & recent developments

• Delhi (DDA): DDA runs conversion camps and has published specific procedures and annexures. Recent reporting in 2026 shows DDA updating circle rates and temporarily freezing some conversions while recalculating charges, illustrating how policy adjustments change costs. Prospective applicants must track the authority’s latest circulars.
• Maharashtra: In 2024-25 the state published rules permitting conversion at capped premiums (reporting commonly cites up to 25% of RR/ASR for residential categories). Subsequent special schemes (for specific groups) offered lower rates. Check Maharashtra state revenue / municipal pages for the exact SRO.

Common Complications and How to Avoid Them

• Missing/defective title chain: Ensure conveyance/lease chain is clean. Get a professional title search before applying.
• Outstanding dues and encumbrances: Clear all taxes, maintenance arrears and utility bills; authorities will not convert until clearances are furnished.
• Circle rates and sudden policy changes: Authorities can change circle/ready-reckoner rates affecting conversion maths (example: DDA’s adoption of new circle rates in Jan 2026). Track authority notices to time your application.
• Special conditions in old leases: Some leases have reversionary clauses or statutory limits. Legal advice is critical for old pre-independence or colonial-era leaseholds.

Checklist Before Starting Conversion

1. Read your original lease deed and note the lessor authority.
2. Get a title search / encumbrance certificate from the sub-registrar.
3. Obtain no-due certificates for taxes, ground rent and maintenance.
4. Check the authority’s portal for conversion application form and fee schedule (DDA, MCGM, JDA, State portals).
5. Budget for conversion premium + stamp duty + registration + professional fees.