Government Proposes Raising of Circle Rates in Noida

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The Gautam Budh Nagar administration has proposed to bring the circle rates, which are used to calculate the stamp duty on property transactions, on par with market prices and impose an additional surcharge of 5 percent to 12.5 percent on properties along the Metro route or near the expressway. “This is only a proposal. This has not been implemented yet. The idea is to bring allotment rates at par with circle rates. The final decision will be taken by the collector. Future course of action would be taken on the basis of objections received,” said SS Pal, assistant inspector general of stamp and registration department, Gautam Budh Nagar Stakeholders that include residents and builders have a window of 15 days to register their objections. The new rates will be notified only after objections have been received. The UP government currently charges 7 percent of the property value as stamp duty. Both homebuyers and developers’ bodies have opposed the move and are planning to file objections. They are of the view that this may have a negative impact on the real estate market during COVID-19 times. The Yamuna Expressway Industrial Authority had increased the land allotment rate two months ago by 5 percent; the Greater Noida Authority had hiked its rates by 4.5 percent in June. Noida Authority had also increased the allotment rates by almost 20% in some sectors. In Noida’s category A sectors such as 14A, 15 A and 44, the circle rate is proposed at Rs 1,94,250 per sq m against the existing 1,03500 per sq m which is more than a 85 percent hike in rates, which have been due for revision for four years. Category B sectors include 11, 12, 22, 70, 71, 72, 73, 74, 75, 76, 77 and 78 where most of the housing societies are located and the rate proposed in these sectors is Rs 72,000 per sq m. The current rate in these areas is Rs 52,500 per sqm. This is an over 35 percent increase. Circle rate, or ready reckoner rate, is the minimum price at which the property sale is registered. This rate is determined by the state government and is generally reviewed to align it with the market rate. The stamp duty and registration charges on property transactions are calculated on the basis of the circle rate or the actual value of the property, whichever is higher. The increased circle rates would result in an increase in stamp duty and registry charges, which would make the properties costlier.