Move to hike stamp duty irks tenants in the island city
The state government's decision to levy stamp duty based on the market value for sale of tenanted property in the island city has upset those living there.mumbai Updated: Mar 25, 2011 02:15 IST
The state government's decision to levy stamp duty based on the market value for sale of tenanted property in the island city has upset those living there.
In fact, even the ruling party legislators have decided to oppose the new rule fearing losing their vote banks. The said amendment is expected to exorbitantly hike the duty by at least 10 times than the current one.
Congress Mumbadevi legislator Amin Patel, who first dissented against the proposal in the party meeting, will write a letter to chief minister Ashok Chavan on this matter.
“This would sound a death knell for the tenants, who are already living in old, dilapidated structures,” said Patel.
Calling it a bad move that would hurt the labour class, Sewri legislator Bala Nandgaonkar said: “These people cannot afford to buy flats in new constructions and tenanted properties were their only hope.”
The Maharashtra Chambers of Housing Industry has asked the state government to reconsider the move.
“This would only encourage corrupt practices as it gives more discretionary powers to the officials,” said Sunil Mantri, president of the Maharashtra Chambers of Housing Industry.
Most of these tenanted properties were built prior to 1970 and are located in the island city.
The tenants are protected under the Maharashtra Rent Control Act because the landlords cannot evict them and the rent they pay is meager.
Currently, stamp duty is collected at the rate of Rs 20 per sq ft for residential properties and Rs 200 per sqft for commercial ones.
“The entire realty market is bound to stagnate because people will think twice while
buying property,” said Viren Shah, president, Federation of Retail Traders Welfare Association.
Activist Gaurang Vora, who owns a tenanted property, said the rates are set to increase substantially.
“The landlords take a chunk of money in the transaction and now with the state vying for a big share, the seller is left with hardly anything,” said Vora.