For a fair value for your
land
| The official exercise that is on to fix the fair value of land will
have a far-reaching impact on immovable property transactions in the
State when it is completed next year. K. S. SUDHI describes what is
being done and points to what is in the offing. |
After a hiatus of a few years, renewed attempts are on in the
State to fix the fair value of land.
This time the State Government is bent on fixing the fair
value of land after plugging all loopholes in the system and without leaving
room for any public outcry against any `unfairness' in the fixing of land value.
Controversies
Any move to fix the fair value of land tends to get embroiled
in controversies and complaints as it affects large sections of society. The
general public and specific sections of society, including stamp vendors,
document writers, builders and those who are in some way or other associated
with the real estate sector and also the Government are curious about
developments in the sector.
The impact of the fixing of fair value does not confine
itself to impacting stamp duty alone. The fixing of the value is also viewed as
a prelude to the reduction of stamp duty in the State. The move to reduce the
stamp duty in the State is of significance as it has been pointed out that
Kerala is one of the States with the highest rate of stamp duty for transaction
of immovable property.
Varied
interests
If it is the under-valuation of property and the resultant
revenue loss that is worrying the Government, those associated with the sector
are anxiously waiting for the announcement of the value of land in their
respective areas and also in their places of interest.
According to a rough estimate, nearly 50 per cent of the
documents associated with the transfer of immovable properties fail to reflect
the real land value existing in the respective areas. Though the Government is
pretty aware of the increasing instances of under-valuation of property and the
failure of documents to reflect the increasing land value, the lack of
infrastructure including adequate staff, stands in the way of adoption of steps
to counter this practice.
Meanwhile, the Registration Department, in consultation with
stakeholders including document writers, have arrived at a guideline value (not
the draft fair value) for the key centres and suburbs of Kochi. The guideline
price would serve as the base price for the respective areas for registration of
documentsThe base price will hold good till the end of the current fiscal.
Why fair
value?
Once the fair value of land is fixed, no document showing a
land value lower than what has been fixed for the particular area will be
registered.
This process, hopes the Government, would do away with the
trend of under-valuation of land, bring in transparency in land deals and also
the registration process, and root out corruption, besides saving those
involving themselves in the transaction of immovable property from the clutches
of middlemen.
Ideally, the Government hopes to find the stipulated patterns
of land value reflected in all the transactions, after the fixing of fair value.
It was revealed at an informal assessment made recently at
the State Registration Department that it would take nearly 70 years to complete
the processing of all pending cases of under-valuation in the State.
The fixing of fair value is a daunting task, realises the
Government.
It is not the quantum of work alone that is worrying the
authorities. The extensive coordination that is required between at least three
Ministries involving hundreds of officials at various levels and the shortage of
hands make the job one of the toughest acts for the Government. Now it is a
joint exercise that is being carried out by the Registration Department, Revenue
and Finance Ministries for fixing the land value in the State.
Kerala
Stamp Act
It is section 28 A of the Kerala Stamp Act of 1959 that deals
with the fixation of fair value of land.
The Act says that "every Revenue Divisional Officer
shall, subject to such rules as may be made by the Government in this behalf,
fix the fair value of the lands situated within his area of jurisdiction for the
purpose of determining the duty chargeable at the time of registration of
instruments involving lands."
The Rule also specifies that the RDO shall publish the fair
value and exhibit it in his office, taluk and village offices, offices of the
local body and offices of the district registrar and sub-registrar.
Appellate
authority
The objections and suggestions relating to the draft fair
value shall be filed within a period of 60 days from the date of its
notification in the gazette. The fair value will be fixed in units of Are.
The District Collector has been fixed as the appellate
authority for the fair value and applications should be submitted to him in
prescribed form after affixing court fee stamp of the value of Rs.25.
The Rules states that the "fair value fixed may be
revised every five years or earlier, if, in the opinion of the Government any
substantial change of the fair value of the land has taken place."
Official
preparation
A high-level meeting, attended by the secretaries of Revenue,
Registration and Revenue, Revenue Divisional Officers, Land Revenue Commissioner
and also the Inspector General of the Registration Department was convened
recently to chart out an action plan for the fixing of fair value.
According to an understanding reached at the Government
level, the fair value will be fixed in February next.
The Government hopes to make the fair value effective during
the first half of the financial year 2007-08.
* * *
The amendment
The State Government recently amended the Kerala Stamp Rules
1995 to classify the land in the State. According to the amendment that was
introduced through a Government order in October, land will be classified into
15 categories based on its topographical structure: Commercially important plot,
residential plot with National Highway/Public Works Department road access,
residential plot with Corporation/municipality/panchayat road access,
residential plot with private road access, residential plot without vehicular
access, garden land with road access, garden land without road access, coastal
belt, water-logged land, rocky land, wasteland (land in close proximity to
dumping yards, graveyards, etc.), wetland, hill tracks with road access, hill
tracks without road access and Government land.
Courtesy: Property Plus, The Hindu
http://www.hindu.com/pp/2006/12/02/stories/2006120200300100.htm
