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dna exclusive: South Mumbai leaseholders prefer to pay rent than get occupancy rights

Only 62 out of 1,800 opt for the right, most of them from the suburbs.

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In South Mumbai, residents of state leasehold properties in Cuffe Parade, Nariman Point, Churchgate and Marine Drive would rather pay rent than buy the occupancy right to these properties by shelling out a one-time amount.

To resolve the 1,800 leasehold prime properties issue, the state government recently issued a notice, asking leaseholders to either buy the permanent occupancy right to the property by paying 30% of the total cost of the property, as per the ready reckoner rate, or pay 0.5 per cent of the total cost of the property to stay on rent on an annual basis.

“However, out of 1800, only 62 government property leaseholders have shown interest in buying permanent occupancy right,” said city collector Chandrashekhar Oak. “We are happy that the people have welcomed the government decision. We tried a couple of times earlier, but people went to court against our revised policy decisions. This time, there is not a single case of court litigation,” said a revenue department official.

Oak said that the move would increase government revenue.

“We were earning peanuts as lease revenue. Most leaseholders were paying a princely sum of Rs1 as annual lease rent. These properties were on 90 to 900 years’ lease. The current policy will be transparent. People will have a scientific formula to calculate lease rent,” Oak said.

Property experts said even after paying the hefty occupancy right fee, leaseholders will not gain ownership of the plots as the government will remain owner. “If they want to redevelop these properties, they will not able to. So, people have opted to stay on and pay rent rather than buy ownership rights,” Atul Nemade, a property expert, said.

Nemade said that the government rate (RR rate) is high. “People were paying a very less sum as per their 30 to 40-year-old agreements. That amount has shot up drastically. So, only 61 people have decided to buy occupancy rights,” he said.

Earlier, residents of leasehold properties had said that if the government asks them to pay stamp duty and registration fee to buy occupancy rights, then they should be given ownership right along with occupancy right.

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