SIPCOT Land Allotment: Price Rules, Deadlines and Cancellation

SIPCOT does not sell industrial land. It leases plots for 99 years on a strict clock: 30 days to pay, 36 months to build, five years before the plot is taken back. Those rules, and the land price discount by district, decide who sets up where around Chennai.

The numbers

An industrial plot in a SIPCOT park is a long lease, not a sale. The corporation’s citizens charter sets the term at 99 years, renewable for another 99 on agreed or prevailing terms. The allottee must pay the full plot cost, including a 5% caution deposit, within 30 days of the allotment order, and finish the project within 36 months. If the project is not running within five years, extensions included, the allotment is cancelled and the plot taken back.

The price itself varies by district. Under the Tamil Nadu Industrial Policy 2021, SIPCOT allots land in industrially backward ‘C’ category districts at a 50% concession on land cost, given up front, while in ‘A’ and ‘B’ districts the concession is 10% and paid back later, according to the Industries department policy note for 2024-25. Districts around Chennai are not in the C category, so a unit at Oragadam pays close to full price at allotment.

Taken together, the rules are designed to stop land banking: a company that takes a plot and sits on it loses money at each stage.

From application to lease deed

Applications go online through the SIPCOT portal with the required documents, an initial deposit and a processing fee plus GST. The charter sets a target of 60 days from application to decision and names the Chairman and Managing Director or the Managing Director as the deciding authority. Paying the deposit does not guarantee a plot; if the application is rejected or closed, the applicant must claim the deposit back within 30 days of the letter or lose it.

Source: SIPCOT Citizens’ Charter, land allotment section

Penalties, surrender and cancellation

Two details matter for anyone reading a SIPCOT dispute. Penalties are pegged to the ‘prevailing’ plot cost, so a late allottee pays at today’s rate rather than the rate at allotment. And a company that surrenders a plot voluntarily gets back what it paid less 1%, which is far cheaper than being cancelled after missing the implementation deadline.

Approvals that sit outside SIPCOT

A plot alone does not allow construction. The charter lists the approvals the allottee must obtain separately: building plan approval from the Directorate of Town and Country Planning or the local body, consent to establish and later consent to operate from the Tamil Nadu Pollution Control Board, compliance with the park’s environmental clearance, and an application for power supply. Running costs follow too: a monthly maintenance charge for roads, street lighting, drainage, sewerage and common buildings, and water charged on the committed or consumed quantity in the allotment order.

How the land bank has grown

Source: Tamil Nadu Industries department policy notes 2015-16, 2023-24 and 2024-25 (2015-16 figures are for 2014-15)

The jump from 28 to 40 parks in a year looks larger than the land figures support; area rose only about 2,300 acres. The notes do not explain the change, and it may reflect how parks and expansions are counted. The 2015-16 note also separated acquired land (31,645 acres) from allottable land (24,115 acres), a distinction the later notes do not make, so the series should be read as indicative.

The 2024-25 note sets a land bank target of 45,000 acres, with acquisition in progress for 21,404.11 acres and 14,669.75 acres identified for new parks. Simple division gives about ₹4.5 crore of cumulative investment per acre of SIPCOT land, ₹1.83 lakh crore over 40,839 acres, though that includes roads, common areas and unallotted land.

The parks around Chennai

The 2024-25 note gives the extent of each park. Those within reach of Chennai are among the largest in the system:

Source: Industries department Policy Note 2024-25, SIPCOT section

Together these seven account for 13,409.57 acres, about a third of SIPCOT’s total. Some newer parks are being allotted by sector: the note records 126 acres to three units in the International Furniture Park, 39 acres to 20 units in the Medical Devices Park and 13.43 acres to five units in the Future Mobility Park. Another state agency, TIDCO, lists its own industrial park at Thiruvallur among ongoing projects, so not every industrial plot near Chennai comes through SIPCOT.

What this means for you

• Budget for 100% of the plot cost within 30 days of allotment; SIPCOT does not offer instalments in its charter.
• Plan the project timeline around the 36-month limit; an extension costs a bank guarantee of 15% of the current plot price.
• If a project is unlikely to proceed, surrendering the plot early costs 1% of what was paid, far less than forfeiture after cancellation.
• Check the district’s category under the Industrial Policy 2021 before comparing sites; the land concession is 50% up front in C districts and 10% back-ended elsewhere.

What to watch

Checked against official sources on 23 October 2026. Figures and rules change; confirm on the linked official pages before relying on them.

Sources

1. Citizens’ Charter, SIPCOT (State Industries Promotion Corporation of Tamil Nadu)
2. Industries, Investment Promotion and Commerce Department Policy Note 2024-25 (Government of Tamil Nadu)
3. Industries, Investment Promotion and Commerce Department Policy Note 2023-24 (hosted by SIPCOT)
4. Industries Department Policy Note 2015-16 (Government of Tamil Nadu)
5. TIDCO ongoing projects (Tamilnadu Industrial Development Corporation)