11 - 06 - 2020

CREDAI Bengal Daily News Update | 11.06.20

WEST BENGAL NEWS

Stores in Calcutta malls seek rent relief

Some even pitching for a revenue-share model with the eshtablishments

Malls in the city have reopened but many of their stores have not.

Remaining shut for two months because of the lockdown has dealt a body blow to businesses,

officials of such stores said. Many owners have cited the “unprecedented” slump while

demanding that mall authorities waive the rents for April and May, according to the officials.

Some have gone a step further, seeking a reduction in rent rates for now or pitching for a

revenue-share model with the mall, according to managers and executives of such stores.

Assuming it will take several months for business to bounce back, some stores are said to have

demanded clear commitment from mall authorities to increase footfall in the coming days.

A tour of South City Mall on Tuesday afternoon revealed multiple closed stores on every floor.

They ranged from street fashion brands to sportswear. Marks and Spencer, Gas, Forever 21,

Adidas, Reebok, Steve Madden and Calvin Klein were some of the closed stores at the mall on

Prince Anwar Shah Road.

An official of the mall said “30 per cent” of its stores were shut. The mall has close top 120

stores, he said.

Tommy Hilfiger, Louis Philippe, Van Heusen, Manyavar, Allen Solly, Levi’s and United

Colors of Benetton were some brands with downed shutters at Quest Mall on Tuesday. An

official said “70 per cent” of the stores were operational.

The Park Circus mall has close to 130 stores, the official said.

The Acropolis Mall in Kasba had at least six closed stores — The Body Shop, Marks and

Spencer and Gini and Jony among them.

“We did not have any business for more than two months. We are asking the mall authorities to

waive the rent for the lockdown period and reduce the amount for the next few months,” the

manager of a shut store in Quest Mall said.

Newspaper/Online The Telegraph ( online )

Date June 10, 2020

Link https://www.telegraphindia.com/calcutta/coronavirus-pandemic-stores-in-calcutta-

malls-seek-rent-relief/cid/1779802

Many stores have asked malls to invest in promotional activities to attract buyers. They want

the malls to share revenue if the rent amount is not reduced.

An ethnic wear store in South City Mall has had not a single visitor since Monday, the store in-

charge said. “We opened at 11am today but are still to receive our first visitor,” he told Metro

around 1.30pm on Tuesday.Mall authorities and many store owners are still to reach a

consensus on rent.

An official of one of the malls in Calcutta said the retail stores were “forming associations and

putting pressure by threatening not to open shops”. “We understand that they are facing

financial problems but they cannot put a gun on our heads,” the official said.

Several stores are shut for “logistics issues”, according to authorities of several malls. At least

one apparel chain said the safety kits were still to arrive because of logistic issues. “The courier

company said it did not have enough infrastructure,” an official of the chain said.

Sanjeev Mehra, vice-president of Quest, refused to comment on individual stores. “With

business partners, Quest Mall has been behaving very responsibly. The Covid-19 crisis is

something that has never happened since Adam and Eve. There is a lot of stress on the retail

sector. Some brands could be exiting, making way for new entries,” he said.The South City

Mall authorities said a few stores had sought waiver of rents for the lockdown period. The mail

is “awaiting the Supreme Court’s decision on a case pertaining to the moratorium on loans”.

A petition has been filed in the apex court, challenging an RBI circular dated March 27, which

had offered a moratorium on loans till May. It was later extended till August though there was

no exemption in terms of accumulated interest components. On June 4, the top court sought the

views of the finance ministry on the matter.

“We are waiting for the Supreme Court’s decision on the moratorium case… it is expected later

this month. We have not raised invoice to the stores for the entire lockdown period,”

Manmohan Bagree, vice-president, South City, said. “Once the court order comes, we can

amicably decide on the rent issue. Till then, we have requested the stores to function.”

Sushil Mohta, the chairman of Merlin Group that owns Acropolis Mall, said several stores were

shut because of “defective shutters and broken glass”.“Few stores have rent issues, which we

will discuss and resolve. But some of them are putting pressure on us and we want them to

leave. The malls have to pay bank interests. We have appealed to the Centre to waive bank

interests for the time being,” Mohta said.

_____________________________________________________________________________

OTHER NEWS

Finance Minister to study realtors’ debt woes with fresh, open

mind: Credai

Union Finance Minister Nirmala Sitharaman has promised to “give a fresh and open-minded

look’, including the one-time debt restructuring issue, to help the cash-strapped real estate

sector.

This is a sign of hope for the industry, which has been asking for a one-time debt restructuring,

passing the repo rate cut benefits to the end user and GST benefits, according to a press release

issued by Mumbai Metropolitan Region (MMR) Action Committee of developer’s body Credai

MCHI.

The MMR Action Committee has also petitioned the Prime Minister via online garnering of

about 35,000 signatures.

On Tuesday, former Chief Minister Devendra Fadnavis, who is also the Leader of Opposition in

Maharashtra legislative assembly, addressed a webinar of real estate developers and assured

them of finding a solution for the one-time debt restructuring issue. They had also promised to

take up the issue with the Finance Minister.

Fadnavis also concurred with the developers that this step will bring in relief to the industry

facing a lot of financial stress, the release said.

The former Chief Minister has also expressed his shock that banks have not yet passed on the

benefit of the repo rate cut to the end consumer.

He also said that the massive loan repayment defaults arising out of high interest rate will lead

to a big jump in non-performing assets (NPAs) for the banks, which will “be disastrous for the

economy as a whole”.

Newspaper/Online The Hindu Business Line ( online )

Date June 10, 2020

Link https://www.thehindubusinessline.com/news/real-estate/finance-minister-to-study-

realtors-debt-woes-with-fresh-open-mind-credai/article31794442.ece

The banks’ attitude does not live up to the good intentions of the Centre and RBI who are keen

on increasing the liquidity, Fadnavis remarked.

Fadnavis said Prime Minister Narendra Modi is keen to support the businesses all across, which

is exactly why the announced the Rs 20-lakh crore relief package with predominant focus on the

MSME sector.

Earlier, making a presentation on the developers’ issues, MMR action committee spokesperson

Ajay Ashar told Fadnavis that banks were in a comfortable position when they deal with real

estate developers. They get an Return on Equity of 22-25 per cent, which is the highest in the

world.

Credai MCHI President Nayan Shah pointed out that nothing from the Rs 20 lakh-crore package

announced by the centre benefits the real estate developers. The economy as a whole will revive

itself if real estate survives as every paisa given to the developer goes to the country’s economy

________________________________________________________

____________________________________________________________________________________

Newspaper/Online The Times of India ( online )

Date June 11, 2020

All kind of loans & contractual transactions can't be put under

moratorium: SEBI to SC

SEBI filed an affidavit in this regard in the apex court which had sought its stand on a

plea which sought a clarification on whether the RBI's circular regarding moratorium on

loan repayment amid the pandemic applies to NBFCs and if real estate firms are eligible

for it.

Almost all industries in the country have been suffering due to COVID-19 pandemic but all

kinds of loan and contractual transactions cannot be put under the moratorium, the Securities

and Exchange Board of India (SEBI) has told the Supreme Court.

SEBI filed an affidavit in this regard in the apex court which had sought its stand on a plea

which sought a clarification on whether the RBI's circular regarding moratorium on loan

repayment amid the pandemic applies to Non-Banking Financial Corporations (NBFCs) and if

real estate firms are eligible for it.

While seeking dismissal of the plea filed by an association of real estate developers, the SEBI

said that it appears to be "proxy litigation" where the petitioners have raised grievances and

issues relating to NBFCs and Housing Finance Corporations (HFCs) rather than issues relating

to their own members.

"That not only the real estate sector but almost all the industries in India have been suffering

due to pandemic COVID-19 and as a result of this, it does not imply that all kinds of loan and

contractual transactions are to be put to under moratorium," the affidavit said.

Regarding the petitioner's contention that real estate sector is only on the receiving end during

lockdown, the SEBI said "there is no restriction upon the real estate Industry to receive and

recover money from their customers during lockdown".

It said that on May 13, this year the Ministry of Housing and Urban Affairs had issued an

advisory to the state governments to extend the timelines for completion of real estate projects

which has been delayed due to the pandemic and also for various statutory compliances under

the provisions of Real Estate (Regulation and Development) Act, 2016.

"The net effect of the aforesaid announcement will benefit the real estate developers as there

will be an extension of six months for the completion of the project with further option of three

months extension," it said.

Newspaper/Online ET Realty ( online )

Date June 11, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/all-kind-of-loans-

contractual-transactions-cant-be-put-under-moratorium-sebi-to-sc/76313355

"It is submitted that there cannot be comparison between benefit granted to one section of the

society with the other one as these are need based reliefs," the affidavit said, adding that

authorities have come out with various schemes and reliefs in view of the "unprecedented

situation" that has arised due to the pandemic.

The apex court had on May 15 issued notices to the Centre, RBI, SEBI and others seeking their

responses on the plea.

While hearing separate pleas, the top court had earlier asked the RBI to ensure that its circular

on three-month moratorium on loan repayment between March 1 and May 31 is implemented in

letter and spirit as it appeared that the banks were not extending the benefit to the borrowers.

On March 27, RBI had issued slew of measures to check financial impact of the nationwide

lockdown and had issued a circular giving liberty to all banks and financial institution to allow a

moratorium of three months on payment of instalments in respect of all term loans outstanding

as on March 1, subject to the borrower making such a request.

It had said that repayment schedule for such loans as also the residual tenor would be shifted

across the board by three months after the moratorium period.

Interest shall continue to accrue on the outstanding portion of the term loans during the

moratorium period, the RBI had said.

________________________________________________________________

Bank of Baroda, Union Bank of India reduce lending rates

While the BoB's MCLR cut of 15 basis points (bps) is effective from June 12, the 10 bps

revision in UBI's rates would come into force on June 11.

State-run lenders Bank of Baroda (BoB) and Union Bank of India (UBI) on Wednesday

announced cut in their marginal cost of funds-based lending rates (MCLR) across all tenors.

While the BoB's MCLR cut of 15 basis points (bps) is effective from June 12, the 10 bps

revision in UBI's rates would come into force on June 11.

Bank of Baroda has revised its one-year MCLR to 7.65 per cent from 7.80 per cent, a release

said.

Its six-month MCLR has been revised downwards to 7.50 per cent from 7.65 per cent earlier.

In a separate release, UBI said its one-year MCLR has been reduced to 7.60 per cent from 7.70

per cent.

The six months, three months and one-month MCLR of UBI have been cut to 7.45 per cent 7.30

per cent and 7.15 per cent respectively.

The country's largest lender State Bank of India (SBI) has reduced its MCLR by 25 basis points

across all tenors from Wednesday.

Private sector lender HDFC Bank and state-run Bank of Maharashtra (BoM) have also slashed

their MCLRs by 5 bps and 20 basis points respectively, from June 8.

Last week, the second-largest state-run lender Punjab National Bank (PNB) had cut its MCLR

by 15 basis points across all tenors.

The recent cuts in MCLR by banks have come after the Reserve Bank of India (RBI) slashed

repo rate by 40 basis points to 4 per cent on May 22.

Most of the banks have also reduced their lending rates linked to repo rate by 40 basis points.

________________________________________________________________

Newspaper/Online ET Realty ( online )

Date June 11, 2020

Link https://realty.economictimes.indiatimes.com/news/residential/bank-of-baroda-

union-bank-of-india-reduce-lending-rates/76310129

HDFC Bank cuts MCLR by 5 bps

One-year MCLR, to which many of the consumer loans are tied, will now be 7.65 per cent,

while three-year MCLR has been set at 7.85 per cent.

HDFC Bank has cut its marginal cost of funds-based lending rate (MCLR) by 5 basis points

(bps) across tenors. The rate cut is effective from Monday (June 8), according to its website.

HDFC Bank said its overnight MCLR stands reduced to 7.30 per cent, while one-month MCLR

is 7.35 per cent.

One-year MCLR, to which many of the consumer loans are tied, will now be 7.65 per cent,

while three-year MCLR has been set at 7.85 per cent.

The move comes amid similar steps taken by the peers after two rate cuts by the Reserve Bank

of India (RBI) in order to help the economic growth rise in the aftermath of the COVID-19

pandemic. The RBI has cut its key rates by 115 bps since March.

Banks review their MCLR every month. Lately, some part of the lending has also been linked

directly to external benchmarks, such as the repo rate, for a better transmission of policy

actions.

________________________________________________________________

Newspaper/Online ET Realty ( online )

Date June 11, 2020

Link https://realty.economictimes.indiatimes.com/news/residential/hdfc-bank-cuts-mclr-

by-5-bps/76310107

Coronavirus effect: Developers design homes for post-Covid world

Developers say that as the focus of companies get centred around reducing costs like

transport, office rentals and workstations, the option of work from home may increase in

the coming years.

In a post-Covid world, real estate developers have gone back to the drawing board to redesign

homes. The future-ready houses are slated to have a separate study, kitchen garden, storage

room, powder room, contactless elevators and home automation systems to name a few.

Akshaya, a Chennai-based real estate developer, has already made changes to three of its

ongoing projects, where 2.5-BHK and 3.5-BHK apartments are being made to accommodate a

separate small room for work. Akshaya chairman and CEO T Chitty Babu told FE, “We are

replicating office environments at home. So basic infrastructure like electrical points, WiFi and

broadband connectivity, air conditioning, power back-up and privacy, which are a given in an

office, will all be available to our customers at home”.

Developers say that as the focus of companies get centred around reducing costs like transport,

office rentals and workstations, the option of work from home may increase in the coming

years. “IT services currently spend $500-$800 a month on an individual’s transport, on work

space given and office rental. If they want to reduce cost they may probably increase the work

from home culture over the next five years and then we need to provide homes with that

facility,” T Chitty Babu said.

The pandemic, developers say, has increased the demand for self sufficient homes, which are

currently doubling up as offices for most. Also, with the emphasis on self-reliance given the

fear of contamination has got the developers to think of new ways to make the home well

facilitated for ease of living.

Godrej Properties, for instance, is thinking of introducing space for kitchen gardens in the

upcoming projects so that people can grow their own vegetables from the comfort of their

homes, and also making a separate storage room by the kitchen where people will be able to

store their provisions. Anubhav Gupta, founder, GPL Design Studio, Godrej Properties, said,

“All these thoughts have come from the practical difficulties that people are facing. Imagine

Newspaper/Online Financial Express ( online )

Date June 11, 2020

Link https://www.financialexpress.com/industry/coronavirus-effect-developers-design-

homes-for-post-covid-world/1987595/

having your own kitchen garden which decreases reliance on outside vegetables and fruits, or

having a store room where one could store supplies of a month or two, which is what people

have been doing currently.”

Builders are going into minute details like what kind of a door should be fixed into the room,

which minimises the outside sounds from entering the room and maintains privacy.

While pandemics could be a once-in-a-lifetime situation, one can never be sure and therefore by

having these amenities, developers hope to make houses future-ready. Reeza Sebastian,

president (residential business), Embassy Group, said that design interventions in residential

complexes will now include planning out a strategy to relook at optimisation and efficiency.

“De-densification is certainly going to be the focus both for residential and commercial real

estate by implementing social distancing norms.”

Sebastian added that high-rise buildings were originally designed to organise as many people as

possible in one place, while health and hygiene were not a consideration. “In times of

pandemics, it is necessary to reduce contact with everything that is used in multi-storey

buildings elevator, elevator buttons, door handles, surfaces and, above all, neighbours,” she

said.

Giving a sneak peek into the future, developers said elevators will no longer require operation

through buttons and can be controlled through mobile phones.

Godrej is also considering re-modelling homes to have a washroom or a powder room just

before the living room, around the entrance, where people entering the house could first use it.

Washing cubicles are also being envisaged just outside the houses in Akshaya.

At Shapoorji Pallonji, the move is towards reviving 3-BHK apartments, in which one room can

be used as an office. At present, 50-60% of the company’s residential portfolio is two bedrooms

and 20-25% is 3-BHK. The company is planning to increase the share of three bedrooms by 5%

going forward.

While most of these additions will form part of the design layout and may not attract steep

additional cost for the buyers, some cost it will be. For the additional workplace, Akshaya will

be charging its customers Rs 100 per square foot, T Chitty Babu said.

____________________________________________________________________________________

SC caps interest at 8% to be charged by Noida authorities on

outstanding land dues

The top court said considering the current state of real estate sector, the projects have

come to a standstill and the sector needs to be given impetus mainly considering plight of

home buyers.

Reeling under slowdown and impact of Covid-19 induced lockdown, the real estate companies

in Noida and Greater Noida areas got the much needed relief as the Supreme Court on

Wednesday capped the rate of interest at eight per cent to be charged by authorities on the

outstanding dues of land against the exorbitant 15 to 23 per cent.

The top court said considering the current state of real estate sector, the projects have come to a

standstill and the sector needs to be given impetus mainly considering plight of home buyers.

A bench of Justices Arun Mishra and U U Lalit directed the Noida and Greater Noida

authorities to restructure the dues of real estate firms considering the current state of sector as

out of the 114 plots given in 2005, most of the projects are incomplete.

"We direct that rate of interest on the outstanding premium and other dues to be realized in all

such cases at the rate of 8 per cent per annum and let the Noida and Greater Noida Authorities

do a restructuring of the repayment schedule so that amount is paid and Noida and Greater

Noida Authorities are able to realize the same," the bench said.

The top court said that in case of failure to pay the outstanding amount, the concession granted

shall stand withdrawn but at the same time, the Noida and Greater Noida authorities shall also

ensure that not only instalments/money are deposited and all such projects are completed within

the stipulated time.

"We have noted in the judgment dated July 23, 2019 the figure given by the Noida and Greater

Noida authorities that after 2005, 114 plots had been allotted to various group housing societies.

81 plots were handed over the possession on payment of 10 per cent of the total premium. 29

projects, out of 81 were completed. Out of the other 33 allotted earlier, 11 were completed, and

7 obtained part-completion certificates. Thus, it is apparent that more than 60 per cent of

projects have not been able to come up so far," the bench said.

It said that a large number of home buyers have been waiting now approximately for the last

eight to ten years or more for completion of houses and it is not in dispute that the real estate

sector has suffered a setback at present.

Newspaper/Online ET Realty ( online )

Date June 11, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/sc-caps-interest-at-8-

to-be-charged-by-noida-authorities-on-outstanding-land-dues/76313319

"It contributes to the GDP of the country. As a large number of projects have not come up, at

the same time, Noida and Greater Noida Authorities have not been able to realize their dues

from such projects which are being piled up for the last several years, at the same time interest

of home buyers has intervened. Even on the plots where the land was allotted from 2005

onwards, the projects have not been completed so far, though the buyers have paid their

money," it said.

The top court said that constructions have not been completed due to various reasons including

due to diversion of funds and there was a failure to comply with the obligation to the home

buyers whose money has been invested in the partially constructed structure and partial dues

have been paid to the Noida and Greater Noida Authorities.

"It cannot be disputed that the rate of interest, on which agreements were entered into, has gone

down by now. The present lending rate is much below and the RBI has taken several steps to

revive the economy. In such a scenario, it would never be possible to make payment of interest

at the rate fixed by authorities and also a penal interest to be realized by concerned authorities.

The home buyers are not able to obtain fruits of the investment and are deprived of legal title of

the flats," it said.

The top court's order came on a plea of Ace Group of Companies seeking waiver of the interest

component from the dues towards authorities on the ground that precarious conditions are being

faced by the real estate companies in the entire Noida and Greater Noida region.

It said that the interest rates of the Noida and Greater Noida authorities have remained

exorbitant contrary to the prevailing economic situation of the country and the penal interest on

delayed payment is also added.

The company said that the interest rates of the authorities have been increased from 11 per cent

to 14 per cent - 15 per cent to 18 per cent-23 per cent per annum.

It said that following the economic recession in the last decade, the entire real estate sector has

gone downwards and facing acute financial crunch and is fighting for its survival.

It said that the Covid-19 induced lockdown has further aggravated the situation and "there have

been absolutely no business and commercial activities in this sector, and the entire real estate

industry has come to a grinding halt causing further financial losses and damages to the real

estate sector, which is generally in a precarious condition in the Delhi/ NCR region".

The real estate company pointed out that various firms have stopped production of the

construction/ building material in the wake of lockdown and most of the labourers have gone

back to their home States resulting in shortage of labourers.

"Due to excessive lease rent, penalty and interest charged and levied, additional land costs

demanded, and charged on the land allotted, various projects are stalled. Most of the projects

have acquired the status of dormant projects," the company argued.

________________________________________________________________

Tamil Nadu RERA to conduct hearings on complaints via video

conferencing

The state's realty regulator would be conducting its hearings via videoconferencing using

the Google Meet Application platform.

The Tamil Nadu Real Estate Regulatory Authority (TNRERA) has decided to conduct hearings

over complaints on housing projects through videoconferencing due to the Covid-19 outbreak.

The state's realty regulator would be conducting its hearings via videoconferencing using the

Google Meet Application platform.

"In view of the current situation of Covid-19 pandemic prevalent in Chennai and its surrounding

districts, no physical hearing of complaints is possible for the time being, “a recent order by

TNRERA said.

The authority has decided to conduct hearings through videoconferencing until further orders.

The date of hearing would be intimated through SMS, WhatsApp and email. A link with

attachment to join the videoconferencing session would be emailed.

The concerned parties that are joining the videoconferencing session must arrange their gadgets

intact with necessary accessories to ensure that hearings are held without any disruption,

besides downloading the Google Meet Application to their gadgets, the order further said.

When contacted, TNRERA chairperson K Gnanadesikan said that the real estate authority had

disposed of around 800 complaints regarding housing projects in the last couple years.

"Now, we will be conducting hearings through videoconferencing for the remaining 200

complaints," he said.

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Newspaper/Online ET Realty ( online )

Date June 11, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/tamil-nadu-rera-to-

conduct-hearings-on-complaints-via-video-conferencing/76313411

Housing societies making own rules will face action: Pune collector

Ram said notices would be issued to the offending societies under Section 188 of the

Disaster Management Act and FIRs could be registered against the society members not

adhering to the state government’s directions.

District collector Naval Kishore Ram on Tuesday said housing societies preparing and

enforcing their own “prohibitory orders” would face strict action under the Disaster

Management Act. He said the administration would initiate action if any member raised a

complaint.

Ram’s warning comes in the wake of reports that several housing societies were making their

own rules, such as not allowing domestic help to enter the premises despite the requirements of

several senior citizens or blocking supply of essential services such as milk and gas cylinders.

Many societies across the PCMC limits have resorted to polling within societies to justify their

methods and practices.

Ram said notices would be issued to the offending societies under Section 188 of the Disaster

Management Act and FIRs could be registered against the society members not adhering to the

state government’s directions. He said people living in housing societies could reach out to the

offices of the collector, municipal commissioners and local authorities with their complaints.

“Housing societies cannot have rules that contradict the state government’s rules relaxing the

lockdown. We are receiving complaints and my orders will ensure that nobody staying in

housing societies faces any unnecessary hassle. Housing societies should take a more proactive

role in alerting the administration in case of people coming from outside. They should work

with the administration, rather than create issues for the member residents,” Ram said.Rules

made by many housing societies preventing and regulating ancillary staffers’ entry and not

allowing domestic help have left many senior citizens in a spot. Vernon Fernandes (67) said his

90-year-old mother-in-law faced a lot of difficulties in the absence of her domestic help.

He added that despite showing the municipal commissioner’s order allowing house helps from

the non-containment zones, the chairman of his housing society did not budge from his stand.

“It gets very difficult in such situations. Random rules only create chaos,” Fernandes told TOI.

Social worker Rohan Gaikwad said many societies had prevented domestic helps doubting he

medical certificates they carried with them. Pune civic chief Shekar Gaikwad told TOI that the

rules clearly allowed movement of domestic helps from non-containment zones and there was

no scope of any confusion.

Newspaper/Online ET Realty ( online )

Date June 11, 2020

Link https://realty.economictimes.indiatimes.com/news/residential/housing-societies-

making-own-rules-will-face-action-pune-collector/76310486

Pimpri Chinchwad municipal commissioner Shravan Hardikar iterated that there were no

special rules disallowing the domestic helps from entering the housing societies. He said people

could allow them to work amid proper health precautions.

A senior officer in the district registrar’s office told TOI that if the collector has issued

instructions, they would ensure notices were issued to the housing societies if there were valid

complaints against them.

________________________________________________________________

Jaipur: Construction company asked to pay Rs 214 crore for stamp

duty evasion

Court of collector (stamp) circle - Jaipur-I, ordered Rs 214.84 crore recovery from the

company, Oriental Nagpur Bypass Construction Pvt Ltd, on a case unearthed by the state

directorate of revenue intelligence (SDRI) on stamp duty evasion.

A construction company has been asked to pay Rs 214 crore for stamp evasion, in the largest

case made out by the stamps department in the state.

Court of collector (stamp) circle - Jaipur-I, ordered Rs 214.84 crore recovery from the

company, Oriental Nagpur Bypass Construction Pvt Ltd, on a case unearthed by the state

directorate of revenue intelligence (SDRI) on stamp duty evasion. This order is the largest case

made by the stamps department based on the information given by SDRI, said officials. The

court ordered the company to pay Rs 64.32 crore for stamp duty and Rs 75.26 crore as interest

and the same amount as penalty taking the total amount to Rs 214.84 crore.

An investigation conducted by SDRI on stamp duty evasion found that the consortium and

banks, in order to evade stamp duty, executed their common loan agreements

outside Rajasthan like in Delhi or in Haryana on stamp papers of Rs 100 or Rs 500.

The common loan agreements between consortium and banks are bilateral documents aimed at

reducing the risk of debt between the lender (group of bankers led by the lead bank) and the

loaner. Stamp duty is payable on the said document under the Rajasthan Stamp Act, 1998, as

per rules.

The SDRI has asked Oriental Nagpur Bypass Construction Pvt Ltd to produce relevant

documents on suspicion of stamp duty evasion.

On examination of the documents, it was found that Oriental Nagpur Bypass Construction Pvt

Ltd, had signed a loan agreement with six major banks and financial institutions, including

SBBJ, Jaipur, in 2010, in connection with construction and maintenance of the highway. This

agreement executed in New Delhi amounted to Rs 1,289 crore.

According to the Rajasthan Stamp Act, stamp duty is payable on documents executed in the

state as well as on documents executed outside the state if any immovable property related to

such documents is located in Rajasthan or the document is related to a work to be carried out in

Rajasthan.

________________________________________________________________

Newspaper/Online ET Realty ( online )

Date June 11, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/jaipur-construction-

company-asked-to-pay-rs-214-crore-for-stamp-duty-evasion/76313542

Covid hits Ludhiana civic body plans of survey to identify migrant

quarters, PGs

An official said they will have to visit hostels and PGs in diverse areas for the survey,

which would expose them to infection. He said authorities should wait a few more days to

conduct such a survey.

The civic body plans to start a survey in the city to identify the location of migrant

quarters, paying guests and hostels for recovery of property tax from these establishments,

which fall under commercial categories. Staff members were given 10 days to conduct the

survey but employees are reluctant to make door to door visits for fear of catching Covid-19.

An official said they will have to visit hostels and PGs in diverse areas for the survey, which

would expose them to infection. He said authorities should wait a few more days to conduct

such a survey.

Property tax superintendent Vivek Verma underlined the importance of the survey saying,

“Without conducting a survey, we cannot be sure of the exact number of properties. Once the

survey is completed, owners of these properties can be issued notices.” On employees’

apprehension of catching infection, he said an alternative strategy would have to be chalked out

to handle the task.

Officials said according to rough estimates, there are over 50,000 PGs, hostels and migrant

quarters in the city. From every tenant, owners recover at least Rs 5,000 per month. Even in the

migrant quarters, owners generate Rs 1,500 to Rs 2,000 from one quarter. Earlier, when

property tax had not been imposed, they used to recover house tax at the rate of 9% from them.

MC records for 2012-13 suggest that the civic body recovered Rs 1.08 crore from house tax

from 21,099 units.

When property tax was imposed in 2013-14, it was fixed at 7.5% but the next year, it was

reduced to 3% after which the government asked for it to be charged in line with the residential

accommodation. It was suggested that 7.5% of the annual rent be charged from owners of units

from where they can generate at least Rs 10 crore in the form of property tax every year. The

MC general house gave the nod to this proposal on September 4, 2018.

________________________________________________________________

Newspaper/Online ET Realty ( online )

Date June 10, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/covid-hits-ludhiana-

civic-body-plans-of-survey-to-identify-migrant-quarters-pgs/76295361

Former CMs will have to pay market rent for government houses:

Uttarakhand HC

Rural Litigation and Entitlement Kendra (RELK), a Dehradun-based NGO, had

challenged the provisions of the Act.

The Uttarakhand High Court on Tuesday ruled against the state law that allows former chief

ministers to stay in government bungalows without paying the market rent.

Declaring the Uttarakhand Former Chief Ministers Facility Act 2019 as 'ultra vires', Chief

Justice Ramesh Ranganathan and Justice RC Khulbe of the high court said the provisions of the

Act are in violation of Article 14 (right to equality) and the doctrine of separation of powers

enshrined in the Constitution, the petitioner's counsel Kartikey Hari Gupta said.

Rural Litigation and Entitlement Kendra (RELK), a Dehradun-based NGO, had challenged the

provisions of the Act.

The state government had brought an ordinance to introduce the Act which was challenged by

RLEK in the high court on the ground that it was unconstitutional as it had been issued with the

sole purpose of overruling an earlier judgment of the high court asking former CMs to pay

market rent for government houses allotted to them.

The former chief ministers will now be liable to pay the rent and the state can also recover from

them the money spent over other facilities given to them, the petitioner's counsel said. COR

ALM CK CK

________________________________________________________________

Newspaper/Online ET Realty ( online )

Date June 10, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/former-cms-will-

have-to-pay-market-rent-for-government-houses-uttarakhand-hc/76295331