PUNJAB CRACKS DOWN ON INDUSTRIAL PLOT SCAM, INTRODUCES NEW I CONVERSION POLICY

A cancellation clause is built in for cases of misrepresentation or non-compliance. The Chief Minister is empowered to amend the policy if needed, keeping it adaptable to future requirements.

- Taruni Gandhi, Chandigarh

In a landmark decision aimed at curbing decades-old malpractice in industrial plot conversions, the Punjab Cabinet has rolled out a transparent and legally sound policy to regulate the conversion of leasehold plots into freehold. This move targets what officials describe as a systemic abuse of power by previous governments and bureaucrats, which led to the illegal conversion of hundreds of plots without any financial gain to the state exchequer.

At the heart of the problem was the controversial unearned increase clause—introduced in 1975—which mandated that 50% of the land's appreciated value must be paid to the government upon transfer after a lock-in period. Over time, this clause was effectively nullified through corrupt practices. Instead of following due process, many industrialists allegedly used bribes and political connections to convert their leasehold plots to freehold without paying a single rupee to the government.

According to official records, before the year 1992, out of 1,850 industrial plots governed by this clause, around 1,425 to 1,430 were transferred without adherence to the policy. These transactions, conducted without enforcement of the unearned increase clause, are estimated to have cost the Punjab treasury several thousand crores over the years. The irregularities weren't just fiscal; they created a deep trust deficit between the industrial community and the state machinery, leading to paralysis in several industrial estates. Legitimate allottees who followed the rules found themselves stuck in legal limbo, while those with influence walked away with clear titles.