Madras High Court ban set to promote planned development

However, revenue of government from registration of sale deeds is likely to dip by at least 10 per cent.

September 11, 2016 12:00 am | Updated November 17, 2021 04:53 am IST - CHENNAI:

With the Madras High Court on Friday issuing an order banning registration of plots and houses constructed in unauthorised housing layouts in Tamil Nadu, stakeholders, particularly those who had purchased such properties over the past many years, are keeping their fingers crossed.

While the court directive is expected to promote public policy on planned urban development, check corruption and reduce conversion of agricultural land for non-farming purposes, the revenue for the State government by registration of sale deeds would also dip by at least 10 per cent.

What the court order means is that all the housing layouts in the State, including those on the outskirts of Chennai such as Old Mahabalipuram Road, GST Road and East Coast Road, that were ‘approved’ by village panchayats in the past would remain dead assets as people won’t be able to sell them. Only layouts that were approved by the Chennai Metropolitan Development Authority and the Directorate of Town and Country Planning would be legal.

A section of those in the real estate market feels that any statutory intervention carried out without a proper study of the condition would reduce the supply of affordable housing in various parts of the State.

According to sources in the Registration Department, more than 10 lakh sale deeds of properties are registered every year in Tamil Nadu. At least 2.5 lakh registrations pertain to the sale of plots in layouts.

However, less than 50,000 of the plots registered are authorised by planning agencies such as CMDA and DTCP.

The DTCP has already compiled a list of authorised and unauthorised layouts in the State. However, enforcement remains a challenge. The CMDA is yet to complete the work owing to lack of manpower and inadequate support from civic bodies such as Greater Chennai Corporation.

According to official sources, the number of authorised layouts is relatively high in Chennai Metropolitan Area, with a number of buyers opting for bank loans for purchasing plots. A chunk of the layouts in other areas including major Municipal Corporations such as Coimbatore, Tiruchi, Madurai, Vellore, Tirunelveli, Tirupur, Thoothukudi and Salem are unauthorised.

‘Poor will be hit’

Even as key players in the real estate industry welcome the move to ban unauthorised layouts, a few claim that the poor will be denied opportunity to own homes. For example, some builders are constructing homes on small unauthorised plots in areas such as Tirupur, selling a house at Rs.3.5 lakh to the poor. Developers who sell plots in authorised layouts sell it at a higher price, stressing the need for building homes in areas unaffected by floods and natural calamities.

Officials of the Registration Department said the G.O.(MS) No. 150 by the Commercial Taxes Department dated September 22, 2000 banned unapproved layouts. “It was withdrawn. So the registration of sale deed for unauthorised layouts has been permitted for the past few years,” said the official.

A Madurai Corporation official said that unapproved layouts were increasing in the added areas of the city.

In Tiruchi Corporation, officials estimate that there are about 16,000 plots in unapproved layouts in the city. Several houses have already come up in the residential localities with building plan approvals issued by the erstwhile panchayats.

A few years ago, the civic body requested the government to issue an order for regularising these unapproved layouts nut a decision is awaited.

In Hosur too most unapproved layouts were developed as part of erstwhile panchayats that have now come to be added areas of Hosur Municipality after 2013. Many of the layouts were developed on the mere strength of an NOC issued by the panchayat president and often not inspected by the Town and Country Planning Department.

“There appears to be no committee that was competent to decide on the NOC, or a committee of TCP that inspected the said area,” says a senior revenue official.

Sources in the Housing and Urban Development Department said, more than three lakh layouts have been developed in the State.

“All these layouts have to be extended with civic infrastructure facilities. That requires huge cost. We have to fix some charges to collect from people of unauthorised plots. In rural areas, most of the residents are middle income group and lower income group. We have to look at their paying capacity also. That is the challenge. But we cannot do anything to condone the violations if the key aspects such as road width is not adequate,” said an official.

(Inputs from Aloysius Xavier Lopez in Chennai, S. Ganesan in Tiruchi, S. Sundar in Madurai, M. Soundariya Preetha & Karthik Madhavan in Coimbatore, P.V.Srividya in Hosur, K.Raju in Dindigul, S.P. Saravanan in Salem and P. Sudhakar in Tirunelveli)

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