The Maharashtra cabinet on Tuesday approved the proposal of converting the class II and leasehold lands to freehold.
The government has set the rate for the conversion of these lands at 25 percent of the ready reckoner (RR) rate. The RR rates are the market rates of the properties determined by the government.
This is set to benefit at least 3,000 housing societies in the Mumbai suburbs and over 22,000 housing societies in the state, who are either on class II or leasehold lands. Some of these housing societies are in prime areas of the city.
However, this news has failed to bring any cheer to the residents of these 3,000 odd housing societies.
The representatives of the societies have said in a press note that the whole exercise of the government of converting class II and leasehold lands to freehold is bound to fail is as the rates fixed by the government are too much for them.
This conversion of land is important for these housing societies as this was set to ease the process of redevelopment. Most of these housing societies are quite old.
These buildings stand on what is called as class II property, or collector's land -- that's land given out by the government to sections of society for housing purposes on long-term lease at concessional rates. So technically, any modification needs approval from the collector's office.
Since 2011, the residents of such housing societies have been making representations to the government to make their land freehold.
To address this concern in 2016, the government amended Maharashtra Land Revenue Code (1966) and allowed conversion of class II and leasehold land to freehold by paying a premium to the government. A committee was set up under principal secretary revenue to decide the premium.
“This is too much a burden the societies can bear. To give an example of the burden, if the RR rate is Rs 50,000 per square metre, then the average outgo for 500 square feet and the flat would be Rs 5 lakh. If the RR rate Rs 1 lakh per square metre, then it will be Rs 10 lakh for same size flat. Such a premium is way outside what most common people can pay," said Salil Rameshchandra, president, Federation of Grantees of Government Lands.
This is an association of housing societies who have been granted land by the government.
He further added asking them to pay a hefty premium for conversion is a grave injustice, "These lands, which were given to societies were in such a condition that no one was willing to reside as they were khajans/swamps. The complete infrastructure costs were borne by the societies."
Through the conversion of these lands, the state government has plans of raising a substantial amount of revenue.
But with the high premium set by the government, the experts fear the scheme might not take off as planned. This means the housing societies will have to wait even longer to get their old buildings redeveloped.
First Published: Sept 27, 2018 6:15 AM IST
