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PMC to auction properties over unsettled property tax
On Saturday, PMC published notices in newspapers and started the auction process, which will conclude on February 5, 2024
To intensify action against property tax defaulters, the Pune Municipal Corporation (PMC) has initiated the auction process of 32 properties in the first phase this year. The civic authority has stepped up property tax recovery to achieve the set target of ₹2400 crore for the year 2023-24. During a survey of property tax, PMC found 1,400 defaulters of which PMC has shortlisted 200 defaulters’ properties for auctioning.
On Saturday, PMC published notices in newspapers and started the auction process, which will conclude on February 5, 2024.
According to Property tax department officials, it is the first time; that PMC is carrying out an auction of 200 properties. Last year, PMC auctioned nine residential properties for recovery of around ₹8 crore.
Initially, PMC shortlisted those 32 properties for auction which have maximum recovery pending. In this list of 32 properties, 23 are commercial while the rest include open plots and flats.
Ajeet Deshmukh, head of property tax department said, “We have decided to auction 200 properties to recover the dues. We have already initiated a process of 32 properties in the first phase. We are expecting around ₹100 crore from 200 properties. Most of the properties are commercial units.”
In the 2023-24 annual budget, PMC has set a target of ₹2400 crore from property tax collection. Till date, the civic body has collected ₹1830 crore taxes so far, with a deficit of ₹570 crore to achieve the target.
Vivek Velankar of Sajag Nagrik Manch, a citizens’ group said, “It has been done very late, but it is a welcome move. It will help recover arrears and send a message to defaulters to pay tax on time. Such actions should be carried out regularly instead of waiting until the end of the year.”
He further said, “Instead of an amnesty scheme for the benefit of tax defaulters, auction is the best option to recover arrears. The Amnesty scheme sends out a wrong message, adversely affecting its income.”
According to Property tax department officials, PMC is working to increase its revenue by imposing property tax on the Metro authority. This tax will apply to 18 stations, two depots, and other properties owned by the Maharashtra Metrorail Rail Corporation (Maha-Metro). PMC officials estimate annual revenue of approximately ₹20 crores from these Metro properties.
There are about 12 lakh properties in the PMC’s jurisdiction that must pay this tax. To encourage prompt payment, the civic administration offers a special discount to taxpayers settling their dues before May 31 each year.
The civic administration faces a significant challenge in recovering ₹8,000 crore from tax defaulters, which includes taxes on mobile towers and substantial defaulters such as industries, commercial complexes, IT parks, and hospitals.
With property owners failing to settle arrears despite repeated warnings, PMC has opted to auction properties as a stringent measure. PMC imposes a penalty of two per cent per month on overdue property tax payments. Individuals consistently defaulting on property tax for multiple years face asset confiscation by the civic body.
Recovery of income tax arrears has also been given priority by the PMC administration, sending notices to the arrears of crores of rupees, levying fines, and sealing the incomes that do not pay income tax by issuing repeated notices, such action is being taken by the property tax department.
PMC Commissioner Vikram Kumar earlier stated that the civic body has already sealed 2,000 properties. There are around 14,000 properties with outstanding property tax dues, though only 200 will be auctioned in the coming days, he said.
Civic officials said PMC aims to increase the number of lawyers to expedite the resolution of pending litigation cases related to outstanding property taxes. Numerous property owners have neglected property tax payments for an extended period.
