Wednesday, March 9, 2016

GUIDANCE VALUE OF PROPERTIES

GUIDANCE VALUE OF PROPERTIES 


For registration of properties before introduction of Guidance Value by Government, the stamp value fixed was on the basis of discretion by the Sub-Registrar. This discretion power was misused and corruption was rampant for undervaluing property. There was also a procedure for appeal to the deputy registrar on the value fixed by the sub-registrar, which power was again misused for reasons known. Government used to lose lot of revenue by undervaluation of properties by the property owners in collusion with the officials of the registering authorities.
It was a good proposal of Government in fixing the guidance values for both lands and buildings avoiding the discretion power of registering authorities and under valuation by property owners. Another advantage of the guidance value was arriving at the property tax in the Self- Assessment Scheme of the BBMP / local body on the basis of guidance values fixed for various areas of the city.
Guidance value is also useful in Akrama -Sakrarna Scheme for fixing the fine amount for regularizing unauthorized sites and buildings, and violations from building sanctions. This scheme was withdrawn after agitations from the residents welfare organizations and law abiding citizens against the scheme, and agitations also by property owners involved to reduce the fme amounts which were heavy. There is also a case pending in the High Court against the scheme. The bill sent by the Government was returned twice by the Governor. The first time it was returned stating that the scheme will encourage unauthorized developments and building violations. The observation second time was to submit the bill only after disposal of the case pending in the High Court. BBMP / BDA which are responsible for allowing unauthorized constructions and building violations are keen to introduce the scheme to get huge amounts as fine for regularization.
Periodical revision of Guidance Value may be done once in two years to update the values according to the increase in market values, latest trend in potential for development ,etc., and to get more revenue. The aspects mentioned in this article may be considered while revising the Guidance Value. As far as possible, there should be no element of discretion by the officials of the registering authorities to avoid corruption and under valuation. The details of Guidance Value should be clear to the investor to plan the investment. The procedure for appeal should be simple and quick.
Hope the Revised Guidance Value will be clear and simple, the values are almost equal to the market values, and useful to the investors in real estate.
More,

Whitefield    
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