Tag Archives: Immovable Property

Delhi Government comes up with Fresh Directive on Sale of Properties

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Government of Delhi issued a fresh directive to the revenue department asking it to allow sale and purchase of immovable properties only through proper sale and not allow any such transactions by way of General Power of Attorney.

The direction issued by Divisional Commissioner Vijay Dev came as registration of properties at 13 sub-registrar offices across the city had slowed down drastically due to confusion on the issue following issuance of an advisory last month by the government clamping down on property transaction through GPA. “In today’s direction, the government has asked all concerned officials to strictly comply with the Supreme Court order on the issue. The order has been issued to remove the confusion,” said an official.

The government had put restrictions on GPA as a mode of property transfer following the apex court order on October 12 last year but such transactions had been taking place despite the order, prompting the government to issue the advisory. Following the advisory, registration of properties has come down at the sub-registrar offices.

The Supreme Court had on October 12 last year ruled that sale transactions carried out in the name of GPA will have no legal sanctity and immovable property can be sold or transferred only through registered deeds.

Budget 2012: 1 per cent TDS imposed on property sales.

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The government has proposed one per cent TDS (tax deduction at source) on transfer of immovable property if the sale value exceeds Rs 50 lakh in urban centres and Rs 20 lakh in other areas.

Finance Minister Pranab Mukherjee said in his Budget speech that the measure is proposed in the Budget and is being taken to “deter the generation and use of unaccounted money.” Immovable properties, other than agricultural land would be covered under the new provision.

The application of TDS would be effective from October 1 this year. It has been provided that transfer of property would not be registered unless the buyer furnishes proof of deduction and payment of TDS.

At present, tax is required to be deducted at source by the transferee on transfer of immovable property by a non- resident. But, there is no such requirement on transfer of such property by a resident except in few cases, it added.

Reacting to the proposal, the apex realty body CREDAI said that this would lead to increase in property prices.

“It looks like that the proposal of TDS would apply on transactions in the secondary market and not on sale of builder’s flat,” Confederation of Real Estate Developers’ Association of India (CREDAI) Chairman Pradeep Jain said.

The new proposal intends to collect tax at the earliest point of time and have a reporting mechanism of transactions in the realty sector.

The provision would apply if the consideration exceeds Rs 50 lakh if property is situated in “specified urban agglomeration” and Rs 20 lakh if property is situated in any other area.

RBI Restricts UCB’s

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The Reserve Bank of India on Wednesday clamped restrictions on Urban Co-operative Banks (UCBs) to exposure on realty sector up to 15% of their total deposits.

Gift House Loans
Photo by jeremy screen nameSpecified in the circular issued by the Reserve Bank of India , it said the total exposure of UCBs to realty sector, including individual housing loans and commercial real estate, should be restricted to 15% of total deposit resources of any bank.

It further mentioned that the loans granted against the security of any immovable property should be classified as Real Estate Loans. The source of repayment will determine whether the exposure is against commercial real estate. Moreover, the ceiling of 15% is to be reckoned on total deposits of a bank based on the audited balance sheet as on March 31 of the fiscal year 2009-10.

RBI’s latest move will benefit the real estate sector or not is only to be told by time.

Revision in Property Registration Fee

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After a long gap of 45 years, finally this Monday, Delhi cabinet approved the proposal of increasing the registration fee of property in the city. It is expected that through this revision, the revenue collection will be increased from Rs 1.5 cr. per year to Rs 100 cr.

This revised fee is as follows-

  • 1% of the stated value or the circle rate whichever is higher up to a fee of Rs 50,000 will be charged for registering sale deed, conveyance deed, gift deed etc in case of immovable property.
  • Rs. 1000 will be charged if the value of property is not mentioned.
  • In case of immovable property, Rs 1,000 is the fee for registration of lease.
  • Registration of wills will be done at Rs. 500.
  • Rs. 1000 per document will be the cost of miscellaneous registration of documents.
  • Rs. 10 per page will be the cost of copies of registered documents.
  • Rs. 50 will be charged for filling the translation.