Maharashtra property: Scrutiny fee hiked, homebuyers to shoulder burden

Homebuyers have suffered a setback in Maharashtra. The state government has increased the ‘scrutiny charge’ for a clearance that residential projects are required to get from a committee under its environment department. The charges, which depend on the project cost, will ultimately be passed on to homebuyers, developers frowning over the move said.

According to a circular issued by the state environment department, the scrutniy fee for projects worth between Rs 1 crore and Rs 50 crore will be Rs 1.50 lakh, where it used to be Rs 1 lakh before. For projects costing between Rs 50 crore and Rs 100 crore, the charge will be Rs 4 lakh against the earlier Rs 3 lakh. For those worth between Rs 100 crore and Rs 500 crore, it will be Rs 7 lakh, against the earlier Rs 5 lakh. And Rs 15 lakh and Rs 20 lakh will be charged, respectively, for projects costing between Rs 500 crore and Rs 1000 crore, and those beyond Rs 1,000 crore.

“The scrutiny charges are based on the cost of holding environment clearance committee meetings, publishing the minutes of the meeting, notifications, resources and other expenses of this committee,” said an official from the environment department, requesting anonymity.

Developers are not happy with the move. “We have been asked to pay several types of charges and taxes. The property market is going through very turbulent times. The market is not picking up. The rise in scrutiny fees may be little but it will pinch the developers. And it will ultimately be passed on to the buyers,” said Manohar Shroff, vice-president of Maharashtra Chamber of Housing Industry, Navi Mumbai.

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He said developers are already paying for the fungible area and premium for the additional floor space index or virtual space. “We are paying heavily even when there is no sale. From where will we recover this expenditure? The government should think twice before increasing existing charges and introducing new taxes,” Shroff added.