Applications under the Building Regularisation Scheme (BRS) and the Layout Regularisation Scheme (LRS) have become a substantial source of income for GHMC, not by dint of the regularisation fee, but by additional taxes levied on such properties.
Property holders who have applied for regularisation under these schemes have become sitting ducks for the corporation, which has collected more than ₹38 crore in 2017-18, merely by way of penal tax on the BRS properties.
Besides, the applicants are being charged with retrospective effect for five and half years preceding the assessment year as per norms, officials informed.
While the corporation has not violated any norm in doing so, and in fact acted as per government orders for enhanced collection of property tax penalising the deviations, the new assessees feel cheated because the regularisation has not happened as promised.
More than 1.17 lakh applicants, who have applied under BRS, could not get their properties regularised as a PIL was filed in the High Court against the scheme over two years ago.
The issue is pending ever since in the court, and none of the properties could be regularised as the court issued a stay on the same.
Interestingly, the orders fixing the penalties to be levied on violations came in December 2016, one year after the announcement of BRS. “We may have violated the law. But this is like luring a criminal out by announcing a rehabilitation package, and putting him in jail after voluntary surrender,” quips an applicant under BRS.
Property tax has been enhanced for a total of 28,344 properties, and levied afresh on 2,426 properties — all pending regularisation under BRS. These were part of the 12,18,335 properties assessed during 2017-18 which have yielded ₹1,320 crore property tax.
The assessment of BRS properties is a continuing process, and more properties will be included in the coming years, officials say.
Government orders have prescribed 25% penalty over property tax for the structural deviations of upto 10%, 50% for deviations of over 10% and 100% for unauthorised floors or unauthorised construction.
LRS applicants, on the other hand, are brought under the Vacant Land Tax (VLT). As per officials, the VLT is being levied only on the lands regularised under LRS, and not on all vacant plots.
“There are many vacant plots in the city, and we have no means to verify the ownership. Many owners stay outside the city too, and quite a few are caught in legal wrangles. Hence, we are levying VLT only on plots regularised under LRS, and on those approaching for building permissions,” says an official.
The tax is levied for only a year preceding the regularisation or the date of building permission at the rate of 0.5% on the registered market value.
