Lease lands policy revised

Mumbai:In a decision expected to impact redevelopment of scores of properties in Mumbai, the state administration has decided to levy a premium on redevelopment of lands leased by the government. 

    The state revenue department will impose a premium of up to 10% of a plot's market value on redevelopment proposals for leased lands. 

    The proposal, which will be applicable for lease lands across the state, could come up for discussion at the state cabinet meeting on Wednesday. The proposal comes barely two weeks after a Comptroller and Auditor General (CAG) report came down heavily on the government for mismanagement of revenue lands leased to private institutions and trusts. 

    The decision has special bearing on close to 1,200 leased lands in Mumbai. A number of these have been allocated at nominal rents for lease terms that extend to 90, 99, and 999 years. Some have even been allocated in perpetuity. 

    "Value of the land rises manifold after redevelopment. Laws applicable to such lands lack provisions to collect premium. As a result, the government does not benefit from redevelopment despite being the plot owner," the proposal says. 

    A premium of 7.5% of the market value would be applicable for redevelopment of plots meant for residential, educational, and religious purposes, whereas, 10% in other cases. 

    The policy will also be applicable for proposals sanctioned six months before it comes into force. An NOC would have to be procured from the revenue department within six months for such cases, the proposal states. A penalty amounting to another 5% of the market value would be imposed on those missing this deadline. An additional premium of up to 10% will be collected for additional built-up area sanctioned over and above the permissible base FSI. 

    A penalty of 1% of market value will be collected annually for delays in initiating and completing the redevelopment work. Also, the premium, in such cases, would be computed on the basis of the prevalent market value on the day work commences.