State govt to hike rent

MUMBAI, MARCH 11: The Maharashtra government has decided to effect an across-the-board, five per cent annual increase in rent for Mumbai'...

MUMBAI, MARCH 11: The Maharashtra government has decided to effect an across-the-board, five per cent annual increase in rent for Mumbai8217;s tenants which it plans to incorporate in a bill to be introduced during the Budget Session of the state Legislature, Minister of State for Housing Raj Purohit told Express Newsline.

The hike in rent has been necessitated following the Supreme Court8217;s directions to the Government of Maharashtra to amend its archaic rent act Purohit said. He added, 8220;all tenant groups are agreeable to a five per cent hike in rent in order to satisfy the Supreme Court.8221;

The state government, meanwhile is eagerly awaiting the Centre8217;s clearance to its ordinance. State Housing secretary Govind Swaroop, revealed today that the Union Home Minister is likely to sign on the ordinance on Friday. Purohit said once the ordinance is in place, the state would enact a permanent rent law during the Budget Session, which will commence on March 16.

After a year of complete inertia, the stategovernment appears to have gone into a complete overdrive to enact a new rent law.

The state government Swaroop said has filed its detailed affidavit in the Supreme Court on March 9 in a petition filed by the Landlords seeking scrapping down of the interim Rent Act. The landlords meanwhile have now further sought that any ordinance not complying with the 1997 Supreme court judgement should be struck down. A fresh application in this regard was also made by the Confederation of Accommodation Industry of India on behalf of the landlords informed sources.

The Supreme court in December 1997 had directed the state to enact a fresh 8220;fair and reasonable law8221; for the entire state to replace the present Bombay Rent Control Act where rents were frozen at 1940 levels or whenever premises were first let out. However the alliance government had only extended the Act for a year by affecting a five per cent hike in rent.

However, last week, the state government proposed an ordinance introducing crucial amendmentsto the Bombay Rent Act whereby all large commercial premises with a paid up share capital of over Rs 1 crore will not be protected by the Act nor will premises constructed after October 1, 1987 and let out for the first time after the ordinance comes into force. The ordinance states that the Rent Act will not be applicable to premises let to Market Committees constituted under the Maharashtra Agricultural Produce Marketing Regulation Act, 1963, or banks, public sector undertakings or Multi National Corporations, foreign missions, international agencies, limited companies whether public or private limited which have a paid up capital of over Rs 1 crore.