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Gurgaon malls face home truths

Shoppers watch out. The book or dress of your choice may cost even more in a Gurgaon mall, thanks to the cascade effect of shops paying more tax.

delhi Updated: May 15, 2009 00:25 IST

Shoppers watch out. The book or dress of your choice may cost even more in a Gurgaon mall, thanks to the cascade effect of shops paying more tax.

The Municipal Corporation of Gurgaon (MCG) is going to send by May-end shops bills of house tax they never paid before, being outside municipal limits.

The news has rattled storeowners, already dealing with fading footfalls and shrivelled profits—results of the recent economic downturn.

The DLF mall, for instance, which would see 40,000 visitors on a weekend till eight months ago, now welcomes only 28 to 20,000.

“We already pay very high maintenance charges to the tune of Rs. 20 per sq foot,” said Tony Singh, owner of a garment showroom in DLF Mega Mall. "We would not be able to tolerate the burden of house tax as well."

So why were these shops exempt from house tax before now?

“Before the formation of the corporation in June last year, commercial property owners either in private or government colonies were not included in municipal limit and hence were not eligible for paying house tax,” said Rajeev Sharma, Gurgaon Municipal Commissioner.

“But now, these areas having come under the MCG, We expect to collect Rs. 250-300 crores in the next one year,” he added.

Those renting out their residences In private colonies such as DLF City would also get similar bills, said the MCG commissioner.

But shopowners, it seems, are not going to give in timidly to the MCG's new rule

"Private townships in Gurgaon are still to be handed over to the MCG and therefore it has no right to ask for house tax until the area is handed over to it. We would move the court against the order," said BR Wassan, president of MGF Metropolitan Mall Occupants Association.

Still others have said they may seek judicial help or stage demonstrations.