Maharashtra Assembly passes tax relief bill for those living in illegal homes

Maharashtra Assembly passes tax relief bill for those living in illegal homes

Families in tenements measuring up to 600 sq ft exempted from paying penalties; fine lowered for those residing in 601-1000 sq ft homes.

Lakhs of middle class and lower income families residing in illegal homes in Maharashtra’s cities were extended a partial relief Wednesday. The BJP government in Maharashtra ensured the passage of a Bill in the Legislative Assembly exempting such families from paying penalties for occupying an unauthorised structure.

The exemption will be applicable for tenements measuring up to 600 square feet. The penalties applicable to those residing in 601-1000 square feet homes were also lowered.

Earlier, a penalty equal to twice the property tax leviable on such buildings was recovered from such families as arrears in property tax till the property is regularised. On January 8 this year, ahead of the local body polls across the state, the urban development department led by Chief Minister Devendra Fadnavis had issued an ordinance in this regard. On Wednesday, the ordinance was converted into a Bill.

Official estimates reveal that nearly 2.5 lakh structures in Maharashtra’s cities have sprung up in an unauthorised fashion. Most of these house middle and lower income families. While Pimpri-Chinchwad near Pune has about 1 lakh illegal structures, Mumbai’s satellite town Thane, too, has about 60,000 such houses.


The Bill, extending partial relief to such residents, comes at a time when the government’s move to legalise a majority of these structures in one stroke is facing a legal challenge. Minister of State (Urban Development) Ranjit Patil tabled the Bill Wednesday, which was cleared without any discussion.

The CM had earlier run a poll campaign in Pimpri-Chinchwad and Thane where he had promised relief to such families. “There are several instances where some unscrupulous elements after constructing the building unlawfully, sell the flats to the buyers, who purchase the flats under the genuine belief that such construction is authorised under the law. As the amount of penalty was recovered as if it were the arrears of property tax, the burden fell on the buyers who were not at fault,” said Manisha Patankar Mhaiskar, Principal Secretary, Urban Development.

Effectively, the move recognises such families as victims of fraudulent practices of fly-by-night builders. The government has, however, clarified that the respite must not be construed as regularisation of the unauthorised structures.

For those residing in illegal homes measuring between 601-1000 square feet, the penalty amount was lowered to 50 per cent of the property tax liability. But the existing provision of recovering twice the property tax as penalty will continue to be in force for all those residing in tenements over 1,000 square feet.