8/8/22, 7:47 PM CHAPTER X

(ii) That the rental obtained will provide a margin of profit.

(iii) That, except as provided in clause (ii) of the conditions on which the management of the land may be entrusted to a State
Government (paragraph 1011) no liability attaches to the railway administration for any compensation on resumption; and that
except under the general or specific orders of the Railway Board, the Railway Ad- ministration is not committed (though it may retain
an option) to the purchase, on resumption of the land, of buildings or structures erected thereon.

1022. Licensing of Land to Railway Staff.As an exception to Clause (ii) of the preceding paragraph, railway staff may, at the
discretion of the Railway Administration be permitted the cultivation of small plots of "available" land and the enjoyment of usufruct
free of charge. Plots of vacant railway land may also be licensed to railway employees, or to such non-railway organisations as
provide facilities to railway employees, for the purpose of playing games at a nominal rent, where necessary, provided that it is made
clear in the agreement in each case that the land will be resumed at short notice, not exceeding a month, without compensation for
any buildings erected or improvements effected thereon.

1023. License fee for Railway land licensed to private parties.-For fixation of license fee for Railway land licensed to private
parties, a return of six per cent on the market value of the land as assessed by the local revenue, authorities should be treated as
"standard rent". But in actual licensing out, Railway Administration should aim at obtaining the best possible rent. They may accept
in individual cases, variation from "standard rent" on merits and for good and sufficient reasons. The minimum rent in such cases
should be Rs. 100/- per annum.

The assessment of market value of the land as made by the revenue authorities need not always be treated as final or binding. It
may require to be suitably adjusted and escalated if sufficient time has passed since the last assessment was made or if information
was available with the railway of higher prices having been paid for private and other transactions of land in the vicinity.

1024. Periodical revision of rent for Railway land licensed to private parties.-A quinquennial revision of rent for railway land
licensed to private parties should be made in large towns and commercial centres. At other locations rent should be revised at
interval of 10 years only. The exact locations at which five yearly revision should be applied is to be decided by the Railway
Administration in consultation with their Financial Advisers and Chief Accounts Officers. In all relevant agreements provisions should
exist for such periodical revision of rent and recovery of enhanced rent with retrospective effect.

1025. Security Deposit in the case of railway land licensed to outsiders.-In all cases of licensing of railway land to outsiders
the license agreement should provide inter alia for :-

(i) recovery of occupation fees monthly in advance.

(ii) payment of security deposit, equivalent to 12 months occupation fee.

(iii) when the duration of license is one year or more, 12 months occupation fees should be recovered in advance every year
with a grace period of one month.

(iv) where the duration of license is less than a year, the occupation fees for the full period should be recovered in advance.

(v) in case of advance occupation fees as per sub-para (iii) above is not paid by the party within the stipulated period of one
month the occupant shall also pay liquidated damages at the rate of one per cent per month or part thereof to be reckoned
from the due date to the date of actual payment.

(vi) in case payment of occupation fees in not made within a further period of 3 months the Government shall be entitled to
:-

(a) forfeit the Security Deposit referred to above.

(b) initiate eviction proceedings for getting the Railway premises vacated and take ac- tion for recovery of
occupation fee and liquidated damages up to the date of actual vacation.

1026. Licenses could be permitted to make the security deposit not necessarily in cash but also in other forms as approved in the
case of other contracts (refer para 1246).

1027. While payment of advanced rent as indicated in para 1025 should be insisted in the case of land licensed to Government
owned undertakings, payment of security deposits may not be insisted upon provided the concerned Ministry gives a guarantee to
the railway against payment of dues by the Government undertakings. In the case of land licensed to Government Departments
payment of advanced rent should be insisted, but security deposit may not be insisted upon.

1028. Railway land licensed to other Government Departments.-In the case of land licensed to other Government
Departments, a uniform rate of 6 percent of the market value of land as assessed by local revenue authorities is to be levied. A
provision for revaluation of rent at fixed intervals (refer para 1024) in the case of long term lease should be provided in the
agreement.

1029. Leasing of Railway land to Defence Department.-In the case of railway land leased to Defence Department the rent for
the first 10 years of occupation will be fixed on the basis of 6 per cent of the market value of the land, as assessed by local revenue
authorities. If the total period of occupation extends beyond 10 years, the rent will be subject to revision after every 10 years period
of occupation on the same basis of 6 per cent of the market value as assessed by local revenue authorities.

1030. Licensing of Railway lands for religious purposes.-In case of railway lands licensed for use as religious places the fee
should be recovered on a uniform rate of Rs.1,000/- per annum.

(Authority: Railway Board’s letter No. 2002/LML/21/16 dated 4.6.2003)

1031. Licensing of Land for Schools to be opened by State Government in Railway Colonies.-Railway land required by the
State Government for opening of new schools for the children of Railway employees in Railway colonies may be licensed to them at a
nominal fee. The period of license should not exceed 30 years and the amount of nominal fee should be settled by the Railway
Administration in consultation with their Financial Adviser and Chief Accounts Officer.

1032. (i) License Form.A sample license form, for Bulk Oil Depots, is given in Appendix VI but other forms may be adopted to suit
requirements provided that, whether for a Lease or a License, they are drafted under competent legal advice.

https://indianrailways.gov.in/railwayboard/uploads/codesmanual/EngCode/chapter-x.htm#1025 4/10