MUMBAI: In a major move, right before the crucial BMC elections, the Maharashtra government has decided to waive stamp duty and registration fees for residents of old buildings who are allotted homes in newly redeveloped buildings under the cluster redevelopment scheme in Mumbai. The decision will be applicable to all those eligible for homes measuring 400 square feet to 600 square feet under the scheme. An order to this effect was issued by the Inspector General of Registration and Controller of Stamps on November 18.
State revenue minister Chandrashekhar Bawankule said the decision would bring relief to residents who dreamed of owning a home in Mumbai and would also help boost cluster redevelopment in the city. The scheme allows for the combined redevelopment of multiple old and unsafe buildings into a single, large project. It aims to improve urban infrastructure, safety, and housing by offering benefits like higher FSI and potentially larger, more modern homes.
“So far, the residents of old buildings had to pay stamp duty and registration fees on the increased area received after redevelopment, which was based on the construction cost or the ready reckoner rate,” said a senior revenue official. “Now, to enforce the waiver, the combined valuation of the original area, additional area, and extra construction area will be calculated at a concessional rate.”
Bawankule explained that each tenant was eligible for a minimum of 35 square metres of carpet area under cluster development. “In addition, depending on the cluster size, they receive 10% to 35% extra area and 35% fungible area (additional permissible construction),” he said. “All this additional area will now be treated as area received in exchange for the old premises and will be valued at a nominal rate.”
For instance, the government used to charge full stamp duty on the additional area in a small cluster redevelopment project covering 4,000 square metres, resulting in high costs. With the new decision, concessional rates will be applicable for plots up to 51.975 square metres and will afford the developer a saving of approximately ₹21.14 lakh per project.
“Similarly, for a large project approved on 50,000 square metres, the waiver amount will be significant, considering the larger number of eligible units. It goes up to around ₹4.36 crore in stamp duty,” states a release issued by Bawankule’s office. The minister said the policy would improve the financial viability of redevelopment projects and pave the way for long-delayed cluster projects in Mumbai.
Mumbai Congress chief spokesperson Sachin Sawant said that the decision indicates that the BMC elections have arrived. “BJP remembers voters only before elections. The decision would have come soon after the formation of the new government but they waited for a year to announce it just before polls,” Sawant said and added, “If the people want a decision to be made then they should wait for the elections.”