What is FSI? Floor Space Index (FSI) means the quotient of the ratio of the combined gross floor area of all floors excepting areas specifically exempted under these Regulations to the total area of the plot.
Can premises already encumbered to a bank be leased out to a Company with a high deposit and in case of a default who holds the first lien? And will the Company/Occupant be evicted? Yes premises already encumbered to a bank can be leased out to a Company with a high deposit. However you may require the No-Objection of the bank. If the deposit monies are with you and in case if you default on payment to the bank, obviously you will continue to hold the deposit money. The Co./occupant can be evicted only if there is a provision to that effect in the lease Agreement.
What is TDR? Rule 34 of the Development Control Regulations for Greater Bombay, 1991 defines TDR which stands for Transferable Development Rights as under: ‘In certain circumstances, the development potential of a plot of land may be separated from the land itself and may be made available to the owner of the land in the form of Transferable Development Rights. These rights may be made available and be subject to the Regulations in Appendix VII hereto. Appendix VII lays down the rules for the grant of Transferable Development Rights to owners/developers and conditions for grant of such rights: 1. The owner (or lessee) of a plot of land which is reserved for a public purpose in the development plan and for additional amenities deemed to be reservations provided in accordance with these Regulations excepting under certain conditions shall be eligible for the award of TDR in the form of Floor Space Index (FSI) to the extent and on the following conditions set out below. Such award will entitle the owner of the land to FSI in the form of a Development Rights Certificate (DRC), which he may use himself or transfer to any other person. Subject to Reg.1 where a plot of land is reserved for any purpose specified in S.22 of Maharashtra Regional and Town Planning Act, 1966 the owner would be eligible for DR’s to the extent stipulated in Rules 5 & 6 in this Appendix after the said land is surrendered free of cost or after completion of development. TDR’s will be available only for prospective development of reservations. DRC’s will be issued by the Commissioner himself giving details of FSI credit. The built up area for the purpose of FSI shall be equal to the gross area of the reserved plot to be surrendered. 6.When the owner or lessee also develops or constructs the amenity on the surrendered plot at his cost, he may be granted a further DR in the form of FSI equal to the area of the construction/ development done by him.
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How do I determine the property tax on the rent received as I have given the premises on higher rent to a Company? Are there any guidelines set by the BMC? The calculation of property tax on rent cannot be generalized and depends on various factors, but however if the premises are rented out to banks, companies, multi-nationals, etc. who are exempted from the provisions of the Maharashtra Rent Control Act, 1999 by virtue of Section 3(1) (B) of the Act then the rates of property taxes could be as high as 60% or so. If the premises are rented out to others, who are protected under the Rent Act, the Mumbai Municipal Corporation cannot charge taxes on the actual rent and have to base their taxes on
Standard rent defined under the Act, which is, in most cases lower than the actual market rent.
Do I need permission of the Society to keep a Paying Guest and are there any extra society outgoings I need to bear? Yes, you need permission of the Society for keeping a Paying Guest. It depends on the Society byelaws and rules. Some Societies keep asking for extra outgoings by way of NonOccupancy charges.
If I want to sell a flat and buy a new flat in a bigger area. What are my tax implications especially with regard to capital gains? On the proposed sale of your flat you may purchase another flat within two years of the date of sale of the original flat. If you have invested the entire amount of capital gain irrespective of your area of the flat, you would not have to pay any capital gains tax.
When a flat is gifted to a daughter what are the legal implications regarding: i. Titleand how is this established. ii. Gift tax- is it leviable and if so when? If one has gifted a flat to his daughter one should have the gift deed drawn out which should be witnessed by two persons. In case of both the donor and the donee it is preferable to register the said gift deed even if the flat is in a co-operative society. Stamp duty would have to be paid on the gift deed, which would be the same as in case of the sale of a flat. However, there is no gift tax applicable. The gift deed would be the title document indicating the gift to the daughter along with the share certificate if it is in a co-operative society.
How to appeal for reduction of property tax if you are an individual in a society? If property tax has been levied which you feel ought to be reduced, you should write to the society stating your reasons for the same. The society would take up the matter with the Municipal Authorities and have the same reduced if the same is justified.
Is it safe to give ownership flat for leave and license? What are the problems if I give for a longer period? Yes, it is safe to give ownership flat for leave and license provided an agreement has been entered into to that effect and the same leave and license agreement has been registered with the Competent Authority under the Maharashtra Rent Control Act, 1999.
Some residential and commercial properties, which I own are occupied by people who are not paying rent and also not vacating. I require help in solving such problems. In those residential and commercial properties owned by you and occupied by people who are not paying rent you may serve a notice in writing to the tenants for demand of the standard rent in the manner provided in Section 106 of the Transfer of Property Act, 1882 (IV of 1882) and after expiry of 90 days and the rent has yet not been submitted by the tenants you may then file a suit for eviction of the tenants under the Maharashtra Rent Control Act, 1999 and
recover possession of the tenanted premises under Section 16 of the said Act.
If the landlord does not repair or maintain property, staircase, terrace and the tenants want to do, can they and can they deduct rent from the landlord if he does not share? If the landlord does not repair or maintain the property, the tenant could after giving sufficient notice to the landlord do so carry out repairs which are necessary and deduct the cost thereof from the rent.
Do we require permission from the landlord for taking separate water connection, tank etc. Yes, you do require permission from the landlord for taking separate water connection, tank etc.
How can we evict tenants who do not pay or have made changes in their flats? You can evict the tenant who is not paying rent or who has made permanent alterations/additions in the premises by giving him notices to this effect as required under law and proceed against the tenant in a Court to evict him.
What are the formalities required to be completed by foreign citizens of Indian origin for purchasing residential immovable property in India under the general permission? They are required to file a declaration in form IPI 7 with the Central Office of Reserve Bank at Mumbai within a period of 90 days from the date of purchase of immovable property or final payment of purchase consideration alongwith a certified copy of the document evidencing the transaction and bank certificate regarding the consideration paid.
Can such property be sold without the permission of Reserve Bank? Yes. Reserve Bank has granted general permission for sale of such property. However, where another foreign citizen of Indian origin purchases the property, funds towards the purchase consideration should either be remitted to India or paid out of balances in NRE/FCNR accounts.
Can sale proceeds of such property if and when sold be remitted out of India? In respect of residential properties purchased on or after 26th May 1993, Reserve Bank considers applications for repatriation of sale proceeds up to the consideration amount remitted in foreign exchange for the acquisition of the property for two such properties. The balance amount of sale proceeds if any or sale proceeds in respect of properties purchased prior to 26th May 1993, will have to be credited to the ordinary non-resident rupee account of the owner of the property.
Are any conditions required to be fulfilled if repatriation of sale proceeds is desired? Applications for repatriation of sale proceeds are considered provided the sale takes place after three years from the date of final purchase deed or from the date of payment of final installment of consideration amount, whichever is later.
What is the procedure for seeking such repatriation? Applications for necessary permission for remittance of sale proceeds should be made in form IPI 8 to the Central Office of Reserve Bank at Mumbai within 90 days of the sale of the property.
Can foreign citizens of Indian origin acquire or dispose of residential property by way of gift? Yes. Reserve Bank has granted general permission to foreign citizens of Indian origin to acquire or dispose of properties up to two houses by way of gift from or to a relative who may be an Indian citizen or a person of Indian origin whether resident in India or not, subject to compliance with applicable tax laws.
Can immovable property held in India, be transferred relatives/registered charitable trusts/organisations in India?
Yes. General permission has been granted by Reserve Bank to non-resident persons (foreign citizens) of Indian origin to transfer by way of gift immovable property held by them in India to relatives and charitable trusts/organisations subject to the condition that the provisions of any other law, including Foreign Contribution (Regulation) Act, 1976, as applicable, are duly complied with.
Can they dispose of such properties? Yes.
Can sale proceeds of such property be remitted out of India? Yes.Repatriation of original investment in respect of properties purchased by foreign citizens of Indian origin on or after 26th May 1993 will be allowed to be remitted up to the consideration amount originally remitted from abroad provided the property is sold after a period of three years from the date of the final purchase deed or from the date of payment of final installment of consideration amount, whichever is later. Applications for the purpose is required to be made to the Central Office of Reserve Bank within 90 days of the sale of property in form IPI 8.
Can the properties (residential/commercial) be given on rent if not required for immediate use?
Yes. Reserve Bank has granted general permission for letting out any immovable property in India. The rental income or proceeds of any investment of such income are eligible for repatriation.
Can NRIs obtain loans for acquisition of a house/flat for residential purpose from authorised dealers/financial institutions providing housing finance? Reserve Bank has granted general permission to certain financial institutions providing housing finance e.g. HDFC, LIC Housing Finance Ltd., etc., and authorised dealers to grant housing loans to non-resident Indian nationals for acquisition of a house/flat for selfoccupation subject to certain conditions. The purpose of the loan, margin money and the quantum of loan will be at par with those applicable to housing loans to residents. Repayment of loan should be made within a period not exceeding 15 years out of inward remittances or out of funds held in the investors‘ NRE/FCNR/NRO accounts.
Can Indian companies grant loans to their NRI staff? Reserve Bank permits Indian firms/companies to grant housing loans to their employees deputed abroad and holding Indian passports subject to certain conditions.
Can authorised dealer grant housing loan to non-residents of Indian nationality where he is a principal borrower with his resident close relative as a coobligant/guarantor or where the land is owned jointly by such NRI borrower with his resident close relative? Yes. General permission has been granted by Reserve Bank to non-resident persons (foreign citizens) of Indian origin to transfer by way of gift immovable property held by them in India to relatives and charitable trusts/organisations subject to the condition that the provisions of any other law, including Foreign Contribution (Regulation) Act, 1976, as applicable, are duly complied with.
What particulars must 'Deeds of Apartments' under the Apartment Ownership Act contain?
Deeds of Apartments must contain the following particulars, namely:
Description of the land as provided by Section 11 of the Act or the post office address of the property, including in either case the liber, page and date of executing the Declaration, the date and serial number of its registration under the Registration Act, 1908 and the date and other reference, if any of its filing with the competent authority. The apartment number of the apartment in the Declaration and any other data necessary for its proper identification. Statement of the use for which the apartment is intended and restrictions on its use, if any. The percentage of undivided interest appertaining to the apartment in the common areas and facilities. Any further details which the parties to the deed may deem desirable to set forth consistent with the Declaration and this Act.
A true copy of every Deed of Apartment shall be filed in the office of the competent authority.
Housing Society? What should be the contribution from members towards Sinking Fund? When can the amount collected for Sinking Fund be spent by the society? The purpose of collecting Sinking Fund is to accumulate and keep sufficient funds with the society so that the property of the Society i.e. building can be reconstructed in future. The contribution to Sinking Fund is a statutory obligation. Sinking Fund has to be contributed as decided by the General Body of the Society. It should be at least @1/4 per cent per annum on the cost of the each flat excluding the cost of the Land. On the resolution passed at the meeting of the General Body of the Society and with the prior permission of the Registering Authority, the Sinking Fund may be used by the Society for reconstruction of its building/s or for carrying out such structural additions or alterations to the building/s as in the opinion of the Society's Architect is required for carrying out such heavy repairs as may be certified by the Architect. However permission is not usually granted by the Registrar to withdraw amounts from the sinking fund.