UP moves to make land freehold in industrial townships | india | Hindustan Times
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UP moves to make land freehold in industrial townships

In a step towards making land freehold in industrial townships, the Uttar Pradesh State Industrial Development Corporation (UPSIDC) has decided to make residential plots in two of its projects at Greater Noida and Ghaziabad freehold.

india Updated: Jun 12, 2012 21:18 IST

In a step towards making land freehold in industrial townships, the Uttar Pradesh State Industrial Development Corporation (UPSIDC) has decided to make residential plots in two of its projects at Greater Noida and Ghaziabad freehold.

UPSIDC is industrial promotion and infrastructure development undertaking of the state government. Thousands of people in Ghaziabad and about 1,000 in Greater Noida will benefit in this exercise. The Ghaziabad Development Authority currently allots residential plot on freehold basis, but the UPSIDC will make a fresh beginning.

In Noida, Greater Noida and Yamuna Expressway areas, all land – whether residential, commercial, industrial or institutional – is allotted on lease. As a result, even flat buyers in Noida are not owners of the properties for which they invest huge sums. Flats are sub-leased by builders to them.

The state government has proposed allotment of land by all seven industrial development authorities in Uttar Pradesh on freehold basis. But the authorities are resisting the move. “Allotting land on lease is our main source of revenue generation. Besides, this helps us control use as well as transfer of land,” said a senior officer in Noida.

In its board meeting held on Monday, the UPSIDC decided to frame a policy to grant freehold status to housing plots and fix conversion charges within a fortnight.

The two immediate beneficiaries are: allottees of residential plots in Tronica City in Loni (Ghaziabad) and in Surajpur (Greater Noida). UPSIDC regional manager Mayank Srivastava said, “At Surajpur, we have sold residential and group housing plots. Around 1,000 allottees there would benefit.”

“UPSIDC board has given its approval and it will be sent to the state government for clearance before the plan can be introduced.

Our board will decide conversion charges,” said Srivastava. “For future residential schemes if any we will give option of freehold conversion at the time of allotment itself,” he said.

UPSIDC’s Tronica City has residential and industrial sectors. There are 12 residential sectors. Several private developers are building group housing projects.

“Once the freehold policy is implemented, all residential projects here will benefit,” said Rakesh Jha, UPSIDC in-charge of Tronica City.

The two beneficiaries
Residential plots in Tronica City at Loni (Ghaziabad) and in Surajpur (Greater Noida) will become freehold. At Surajpur, UPSIDC has sold residential and group housing plots. Around 1,000 allottees there would benefit. Tronica City has 12 residential sectors.

Several private developers are building group housing projects there. The UPSIDC board on Monday decided to frame a policy to grant freehold status.

Noida still under leasehold system
The three industrial townships in Noida, Greater Noida and Yamuna Expressway are still under the leasehold system. The state government has proposed allotment of land by these three authorities on freehold basis, but they are resisting. Even flat buyers in Noida are not owners of the properties for which they invest huge sums. Flats are sub-leased by builders to them.

What is leasehold property
The authority allots plots or flats for a period of time, which is usually 90 years. A nominal lease rent is charged annually. On expiry of the lease period, the title shifts back to the authority, which is original lessor. Thereafter the allottee once again has to renew the lease for next 90 years, which almost amounts to re-buying the property.

What is freehold property
The property is enjoyed by the purchaser forever and heirs can continue to do so. They can sell, mortgage and deal with it in any manner. There is no expiry period for such properties. Various state agencies such as Awas Vikas Parishad and other development authorities including the one in Ghazibad have introduced the freehold system long back.

Advantages of freehold
Once land in Noida is freehold, it will ease the process of sale and purchase. People will not need to obtain transfer of memorandum. They will not have to seek mortgage permission from the authority while taking bank loans. Freehold land has for long been a major demand in Noida. RWAs have been demanding the conversion for more than a decade now.

Why authorities are protesting
The infrastructure and industrial development department of the state government has proposed allotment of land by all seven industrial development authorities, including the two in Noida and Greater Noida, on freehold basis. But the authorities are resisting the move. Allotting land on lease is one major source of revenue. This helps the authority control use as well as transfer of land.