Thursday, July 20, 2006
Hyderabad: Land conversion to cost dear
The State government is all set to impose yet another financial burden on the real estate sector by charging an “exorbitant” fee on land which is for non-agricultural purposes. The revenue department which collects a nominal yearly Non-Agricultural Land Assessment (NALA) fee from farmers has now decided to collect a one time fee, which will be 10 per cent of the market rate, fixed by the government for registration purposes. This could mean that land owners will end up paying anywhere between Rs 2.5 lakh and Rs 10 lakh per acre, depending on the market rate, as conversion fee.
The government will also impose 50 per cent of the fee as penalty if the land owners fail to pay the one-time conversion fee within the stipulated deadline. This will be fixed by the government again. The immediate impact of this new fee burden could be felt by the realtors who are into forming layouts in a big way in all the urban agglomerations, particularly in the city outskirts. Official sources reveal that the government brought in a new legislation, AP Agricultural Land (Conversion for non-agricultural purposes) Act 2006, a few months back. They, however withheld its implementation in view of the panchayat raj elections. The Act is likely to be implemented from August.
In the era of real estate boom the government has enhanced the market rates for lands and is all set to take up further enhancement on the city outskirts from August 1. “The market price of lands in the radius of 40-50 kms is a minimum of Rs 25 lakh per acre. In such a case the one time conversion fee to be paid to the Revenue department will be Rs 2.5 lakh as against the Rs 500 to Rs 1,000 to be paid by land owners per acre every year, depending on the area,” a senior official said.
This will be in addition to the charges paid to Hyderabad Urban Development Authority for change of land use. At the time of submitting the layout plan, the developers pay Rs 10 per sq mt to Huda for converting the land from conservation zone to residential zone, and sometimes even higher if it is for commercial and industrial purposes. Many of the land owners default on their payment of NALA and the Revenue department neglected the issue all this while because it involved a complicated procedure of assessing NALA for each land every year and collect it from the farmers.
“The compliance rate vis-à-vis payment of NALA is very low. With the new rule, the land owners cannot not pay the fee. If they fail, the land they own will be given deemed conversion and 50 per cent of the conversion fee will be collected over and above the conversion fee,” a senior revenue department official said. The government will also interlink sanction of layout plans or building plans in case of individual vacant plots to the payment of one time conversion fee.
As the NALA Act would be repealed from the date of implementation of the new Act, the government also plans to recover all the NALA arrears from individuals and organisations. “We will also impose the AP Revenue Recovery Act to collect arrears,” the official said.
The government will also impose 50 per cent of the fee as penalty if the land owners fail to pay the one-time conversion fee within the stipulated deadline. This will be fixed by the government again. The immediate impact of this new fee burden could be felt by the realtors who are into forming layouts in a big way in all the urban agglomerations, particularly in the city outskirts. Official sources reveal that the government brought in a new legislation, AP Agricultural Land (Conversion for non-agricultural purposes) Act 2006, a few months back. They, however withheld its implementation in view of the panchayat raj elections. The Act is likely to be implemented from August.
In the era of real estate boom the government has enhanced the market rates for lands and is all set to take up further enhancement on the city outskirts from August 1. “The market price of lands in the radius of 40-50 kms is a minimum of Rs 25 lakh per acre. In such a case the one time conversion fee to be paid to the Revenue department will be Rs 2.5 lakh as against the Rs 500 to Rs 1,000 to be paid by land owners per acre every year, depending on the area,” a senior official said.
This will be in addition to the charges paid to Hyderabad Urban Development Authority for change of land use. At the time of submitting the layout plan, the developers pay Rs 10 per sq mt to Huda for converting the land from conservation zone to residential zone, and sometimes even higher if it is for commercial and industrial purposes. Many of the land owners default on their payment of NALA and the Revenue department neglected the issue all this while because it involved a complicated procedure of assessing NALA for each land every year and collect it from the farmers.
“The compliance rate vis-à-vis payment of NALA is very low. With the new rule, the land owners cannot not pay the fee. If they fail, the land they own will be given deemed conversion and 50 per cent of the conversion fee will be collected over and above the conversion fee,” a senior revenue department official said. The government will also interlink sanction of layout plans or building plans in case of individual vacant plots to the payment of one time conversion fee.
As the NALA Act would be repealed from the date of implementation of the new Act, the government also plans to recover all the NALA arrears from individuals and organisations. “We will also impose the AP Revenue Recovery Act to collect arrears,” the official said.
# posted by mashup @ 12:55 PM 
