Baseline shift

8216;8216;The actual price is rarely quoted in the property transactions in the city. People undervalue their property on paper. Ideally, Delhi8217;s state exchequer should have benefited from the property boom but it hasn8217;t. The minimum rates will be fixed to plug under-reporting of prices,8217;8217; Chauhan says.

A team of five officers is working on fixing the rates and the first report is expected in early April.

The government8217;s effort is part of an overall exercise to prevent under-reporting of property rates while registering deals at the local sub-registrar8217;s offices. If the government is able to plug this loophole, it is expected to earn an additional Rs 250 crore in a year. 8216;8216;After fixing the prices, we will have to take an approval from the Cabinet and implement it. We want to implement it in the coming financial year,8217;8217; says the minister.

WHEN West Bengal introduced the Prevention of Undervaluation Rules to clean up its property market, it came under much attack. 8216;8216;One estimate is that there are over 1,000 cases pending before the Calcutta High Court challenging the rules,8217;8217; says Pradeep K Chopra, honourary secretary of the Bengal chapter of the Confederation of Real Estate Developers Association of India.

The promoters8217; contention is that the sub-registrar8217;s valuations are higher than the actual price paid for property. Chopra says the discrepancy the valuation being higher than the market price ranges between five and 15 per cent. Another promoter, Sushil Poddar puts the difference at 33 per cent. The fact that the valuation is revised annually has become another cause for protest.

BUYERS in Kolkata, meanwhile, cite no such discrepancy. 8216;8216;There was no discrepancy between the price at which I bought the flat and its valuation given by the sub-registrar,8217;8217; says Sanjay Sikdar, who bought a flat last August.

Finance Department officials too deny their valuation is higher than the actual cost. 8216;8216;I can also quote instances of undervaluation where the difference was as much as 50 per cent,8217;8217; counters Debashish Sen, special secretary, Finance Department, West Bengal.

But the government is not ignoring the complaints either. It is now computerising the process, developing a new software for it.

The promoters are not convinced that the Prevention of Undervaluation Rules has helped clean up the property market. 8216;8216;It is an unfair tool that is not changing anything around here,8217;8217; says Poddar.

Chopra has a different take on it. 8216;8216;Today with 80-90 per cent of the property buys funded by bank loans, where is the room for undervaluation?8217;8217; he asks.

Finding the stamp duty too steep 11.5 per cent, many promoters in West Bengal have gone to court. In Delhi, the stamp duty is 6 per cent for women and 8 per cent for men.

The Delhi government, meanwhile, is not too bothered about the possible legal battles ahead. 8216;8216;We know of the Kolkata experience but we are not bothered. Our officers will look into all aspects and fix reasonable base prices,8217;8217; says Chauhan, Delhi8217;s revenue minister.

With Shubhajit Roy in Delhi