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In a move that promises considerable relief to the real estate sector, the Maharashtra state government declared that there will be no imposition of stamp duty on permanent accommodations in redeveloped housing societies. This announcement follows the Bombay High Court's ruling in February and concludes a legal battle that has been ongoing since 2006.
The proclamation by the Maharashtra government holds that residents of a housing society under redevelopment are required to pay only Rs 100 as stamp duty. The primary agreement between the housing society and the developer, however, will be subject to charges as per the conveyance.
In the past, both the development agreement between the developer and the society and the PAAA between the developer and the members required stamping. But the February court ruling nullified previous circulars and stated that a PAAA need not be stamped again if the development agreement has already been stamped.
Redevelopment and rehabilitation projects form the backbone of Mumbai's real estate market due to the city's land scarcity. The revised norm is also expected to positively affect other major property markets in Maharashtra, including Thane, Navi Mumbai, Pune, Nashik, and Nagpur.
The state government has been actively promoting the cluster redevelopment of old and rundown buildings in Mumbai by providing incentives to developers. This latest decision is anticipated to further encourage the redevelopment of many aged housing societies across the state's key cities.
In conclusion, this ground breaking move by the Maharashtra government is anticipated to stimulate the real estate sector, particularly the redevelopment segment. By removing the additional financial burden of stamp duty, the government has cleared the way for expedited redevelopment of many aging and dilapidated housing societies, providing respite to developers and residents alike.
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