CHANDIGARH: Owners of around 50,000 leasehold residential properties of different sizes in the city can soon become sole owners of the houses. After dragging its feet for over three years, the UT administration has approved rates for conversion of leasehold residential properties to freehold. The proposed rates on Friday were sent to the ministry of home affairs (MHA) for final approval following a nod from UT administrator V P Singh Badnore. The administration would notify the rates after the approval.
According to the proposed rates, for properties measuring between 0 to 50 square yards, nothing would be charged. For properties ranging between 51 to 150 square yards, owners would have to pay 7.5% of the collector rate, while for properties ranging between 151 to 250 square yards, the rate has been fixed at 10% of the collector rate. For 250 to 350 square yards, the owners would have to shell out 15% of the collector rate. Rate of 20% has been fixed for properties measuring between 351 to 500 square yards.
The collector rate is the lowest rate at which a property is registered. It is fixed by the administration and revised every year. As per the proposed rates, allottee of 150 square yard plots in Sectors 1 to 12 would have to pay around Rs 9 lakh as one-time chargeable conversion fee.
Last year, the administration had proposed a rate for conversion in which an allottee was to be charged 50% of unearned profit – difference of amount paid by original allottee and current market value of the property. Various resident welfare bodies and property consultants raised objections and demanded calculation of rates on Delhi pattern.
The administration has now fixed the rates following the Delhi pattern and allottees would not have to pay unearned profit.
Since 2013, there was an embargo on transfer of leasehold properties to freehold, following directions from then administrator Shivraj Patil. Prior to embargo, the administration was charging Rs 1,710 per square yard as conversion fee. Talking to media, UT finance secretary Sarvjit Singh said that the rates have been fixed keeping in mind the welfare of city residents. “We tried to keep the rates very nominal as we want people to get their properties converted,” he said.
Kamaljit Singh Panchi, adviser of Chandigarh Federation of Property Dealers, termed the proposed rates as “unreasonably high”. “The collector rates in Chandigarh are very high. The administration should first reduce the collector rates before notifying the conversion rates,” said Panchi.
Conversion would be allowed only in cases where the building on the plot has been constructed and completion certificate for the building has been obtained. Allottees would have to clear all the dues, including charges towards misuse, ground rent and damages before conversion. Conversion to freehold would not be allowed in properties encroached on government land. In case of legal dispute, conversion would be allowed only after the legal dispute was settled.
0-50 square yards | Nil
51 to 150 square yards | 7.5% of collector rate
151 to 250 square yards | 10% collector rate
251 to 350 square yards | 15% collector rate
351 to 500 square yards | 20% collector rate
Sector 1 to 12 (Rs 82,368 per square yard)
Sectors 14 to 37 (Rs 78,250)
Sector 30 onwards (Rs 74, 131)
Difference between leasehold and freehold
Credits ET Realty