As the financial year draws to a close, stamp duty collections in Mumbai seem set to fall short of targets by around 22.76 per cent, with bureaucrats saying realty purchase agreements dipped in the aftermath of the Centre’s decision to demonetise high-value currency notes in November.
Officials from the Department of Registration and Stamps said the total collection in Mumbai in the current finscal is Rs 2,329.52 crore as on March 22, which is 77.24 per cent of the total target of Rs 3,016 crore. The total collection for the state is estimated to cross Rs 20,000 crore by April end, as against the target of Rs 23,500 crore for 2016-17. The overall collection in the state, a senior official said, was 84 per cent of targets.
Officials attribute the drop in collections to demonesation, among other factors. “The overall collection across the state was down since April. After demonetisation, the drop sharpened. Market conditions had not been favourable since April, and agreements drastically reduced after November, with people not opting for transactions,” said an official requesting anonymity.
The office of the Inspector General of Registrations (IGR) registers all types of property deals, including sale and purchase of land, properties, rent and lease agreements. It is the second largest revenue generating department of the state government, after excise.
The official said the drop in collection in Mumbai is higher — 22.76 percent — than in the rest of Maharashtra. Last year in Maharashtra, the total collection was Rs 21,767 crore as against its target of Rs 21,000 crore. While this year’s collection will rise slightly in coming days due to Gudi Padwa, considered an auspicious time for flat purchases, another factor that could cause a small anticipated rise would be the impending announcement of new real estate rates, with the release of the revised Ready Reckoner on March 31, said the official.
In Mumbai, last year’s collection was Rs 2,246.73 crore as against the target of Rs 2,174 crore. It means the overall collection in the city was around 130.35 percent of targets last year. “There are several cases in which people came to inquire about the valuation of properties to know the stamp duty, but did not turn up for actual transactions,” said another official.
Officials added that a recovery was visible in January, after they wrote to the Slum Rehabilitation Authority asking to verify the documents of registration to clear dues. “Also, we attached few bank accounts recently. Some people even went to court seeking a stay, but the court ruled in our favour. Then many others came forward to pay their dues,” said the official, explaining the efforts taken by the department to increase recovery.
Officials added it was unlikely that the market would pick up any time soon, and hence the trend of drop in stamp duty collection was likely to continue for a few more months.