Mumbai flat owners, beware. If you have rented out a property, it is time to keep your leave and license agreement within sight. Or get the agreement prepared and registered if you haven’t already.
The Municipal Corporation of Greater Mumbai (MCGM) has dispatched 600 inspectors to conduct a house-to-house survey. The survey ascertains if any flat owner has rented out property without informing MCGM, or whether the actual rent being charged is different from that on the agreeement. The former will be established by verifying the existence of a registered leave and license agreement at the sub-registrar’s office. The latter, perhaps by talking to your tenants, checking past receipts and personal accounts if deemed necessary.
The corporation collects all property tax under Section 154 of the BMC Act. Until yesterday, it has taken the property owners’ declaration for their word. The MCGM today finds it necessary to countercheck whether the information they are provided is correct or undervalued.
V Radha, the joint civic commissioner in charge of property tax assures us that there has been no change in any rules or policy. “All that we are doing is implementing the existing law,” she said. That means that you have no reprieve if you are caught off guard tomorrow afternoon.
Coming less than a month after the news that Mumbai records world’s biggest rise in Industrial rents, this news has raised fears that rents may go up even further. BS Umbarje, the chief ambassador and collector, allayed these fears. “There is no fear of rents going up,” he said. This action is to be viewed only as an effort to make the defaulters pay, and not as an increase in the actual taxes.
With 3,18,034 properties worth Rs 2,231.11 cr coming under MCGM’s purview, the exercise is expected to take a year for completion. It has a potential to tremendously increase the revenue of the country’s richest municipal organization. In 2006-07 alone, the MCGM has recovered Rs. 107 crore as property tax for properties that had been rented out on leave and license alone.
