Double bonanza
Arrival of malls has not only improved the shopping experience but also sent land prices in a direction till now unknown to the Jammu seller
Tejinder Singh Sodhi

MALL culture has augured well for residents of the City of Temples. Apart from making shopping an enjoyable, comfortable and convenient experience, it has sent land prices spiralling in Jammu.

Till not very long ago, Jammu had no shopping malls but a string of developments on that front in the recent past has taken realty prices to a new high. The first to introduce shopping malls in the city was its very own Jammu Development Authority (JDA), which constructed the magnificent Bahu Plaza, an architectural marvel in itself and a point of attraction for city residents.

After construction of buildings of Bahu Plaza, the land prices in the area near the Railhead Complex have only been climbing up. “One kanal land here costs over Rs 1 crore ever since the complex was built, which is an increase of many times,” says Babu Ram, director, land management, JDA.

Residents who have witnessed the shopping mall mania in the city say that prior to these land was being sold at throwaway prices. “The entire city has developed in my life time,” says Sansar Chand, 74. “I have been here from the time there was nothing in the area.

The place where the now famous Bahu Plaza complex stands was a mini jungle occupied by Gujjars and Bakewals,” he says. “Ever since JDA vacated the illegal occupants and started the construction, people who owned land adjacent to the plot also sold it at very high prices.”

Recently, another shopping mall -- City Square Mall – opened in the heart of Jammu city. Though the area where the mall is located was a dream locality for many, prices of available land in the vicinity are touching the sky.

Residents could not have been happier. “It is beneficial for the people of Jammu any which way you look at it. On the one hand malls are coming up and on the other, sellers are getting a good price for their land,” says Manohar Singh, a property dealer in Jammu’s posh Trikuta Nagar locality. “The new malls have majorly contributed in increasing the market value of land.

Mall owners are on the lookout for localities where they could do brisk business and compete with local shops. So, they want land in posh areas where prices are already high, but money is not a problem for the big business houses,” he explains. He said that as competition between malls increases, real estate prices were following suit.

“Malls offer attractive discounts and prices under one roof. Earlier, we had to visit several shops in different markets to make purchases but now shopping has become fun,” says Sangeeta Kour, a homemaker.

Under Article 370 of the Indian Constitution, no outsider can purchase immovable property in the state. So, real estate developers and mall owners are tying up with local businessman to purchase land, also giving them a good opportunity to grow.

TREND MILL
Go Green, achha hai!
Environment-friendly buildings are the newest fad in Ludhiana with many corporates and individuals doing their bit to save water and power
Kanchan Vasdev

THE environment is fragile, the water table is depleting with every passing day and power shortage is almost certain owing to poor rainfall. Ludhianvis, not ones to be cowed down by adverse circumstances, are taking things in their own hands by constructing buildings and houses that preserve and conserve energy and water.

The trend of green buildings is fast catching up in the state’s financial capital. Residents and corporate houses are trying everything — right from sensor low energy consuming lights, digging pits to harvest rain water and using reflector glasses to keep the heat bay and lower dependence on air conditioning.

Gadgets that promise to save water and electricity are the order of the day. Building owners are using CFL lamps instead of high power consuming halogen lamps in commercial buildings, banks and even showrooms.

Several have installed sensor lights that light up when somebody enters an area and go off automatically when there is nobody in the building. Water taps with sensors, too, have caught the fancy of Ludhianvis in their bid to check water wastage.

Architects, too, are doing their bit to ensure building they design remain cool for most part of the day. “We advise people to have more windows in the northern direction rather than in the south. The sun is in the south for most part of the day and having windows in the direction heats up the house,” says Sanjay Goel, an office-bearer of the Ludhiana Architects’ Association.

Clients have become very sensitive towards the environment, he says. “Be it a house or a commercial building, clients first and foremost want the building be environment-friendly. They themselves ask for low energy lights and reflector glasses and do not mind spending more on these installations,” he says.

Apart from reflector glass, reflector walls are also being built across the length and breadth of the city. Reflector walls are basically double walls with a cavity for air in between the two, which helps keep buildings cool. The branch of Oriental Bank of Commerce on Pakhowal Road has opted for reflector walls. “The electricity bill generated by air conditioners would take a beating with this kind of walls, “ says Sanjay.

Those living on upper floors are paying keen attention to the fact that they would need more energy to keep their houses warm in winter and cool in summer. Several residents have developed garden on the terrace. Others are using a thick layer of fly ash and thermocol on the roof to insulate the house.`

Sanjeev Sood, a resident of BRS Nagar, has developed a terrace garden and is a happy man. “My power bill is much lower than my neighbours. The plants have really helped. You have to live in the house to believe the difference it has made,” he smiles.

Sanjay Goel is quick to explain. “You see, maximum heat is absorbed from the roof. If that surface is taken care of, the house would definitely need less cooling,” he says.

Several corporate and industrial houses are now digging recharge pits to harvest rainwater. Following the guildelines of the Punjab Pollution Control Board, they have developed pits and are successfully recharging the underground water table. Several malls and multiplexes are chipping in too.

China to the rescue

THERE is also a flip side to the Chinese invasion of our markets. Sensor water taps, sensor lights and reflector glass made in China are easily available and easy on the pocket. “Environment friendly buildings don’t imply a drain on the pocket,” says Sanjay Goel. To check further degeneration of environment, the Ludhiana Architects Association has impressed upon the government to enforce a law. In China, only an environment-friendly building gets an approval. “This way they are conserving their environment. A similar ruling is the need of the hour,” he adds. And we agree!

GREEN HOUSE
Jewels in the crown

COLOUR MAGIC: The Koelreuteria in red (above) and green.

CHANGING moods is not just the prerogative of the animal kingdom and homo sapiens. Plants do so, too, but unlike animals, they invariably change moods for almost a single-point agenda: to decorate Mother Earth!

When we saw these wonders of nature, we took our pick and brought these masterpieces to our cities and parks to enjoy their crowing glories. Look at the photograph of any landscape from a European country and you will see colours — especially during the senescence period of leaves, when they are ‘dying’, or are in the process of shedding that they lose colour — mostly to be deep yellow, orange, crimson or red. Even the land below acquires similar hues due to fallen leaves. Maple and oak are some outstanding examples.

The changing colour is due to drying of leaves when winter sets in. Some deciduous trees start shedding leaves and suspend growth as there is danger of damage to new growth due to subzero temperature. Before shedding leaves, however, they withdraw about 70 per cent nutrients from leaves leading to drying and loss of chlorophyll.

In our kind of climate, changing colours are associated with new growth or ‘youthfulness’ of the tree. Barring a few trees like the chinar of Kashmir, most vegetation is colourful with growing beauties. Even during winter when colours change, leaves are retained on plants during stress period as well. A good example of this is the Nandina domestica shrub (commonly called Nandina) that starts changing leaf colour from deep green to deep red and is retained for long on the plant through winter. Leaves are shed only when winter is almost over.

At that time, light green foliage reappears to attain deep green colour. Being a bush, it can be clipped to keep it down. There appear suckers at the base of the plant giving it a bushy appearance.

Most trees look stunning in bloom. This region has a wide range of such trees, both the deciduous and evergreen types. Some of them are Amaltas, Jacaranda (Nilli Gulmohur), Bauhinia species (Kachnar) trees and Gulmohur. In some cases, however, the seed forming pods are not pleasing to the eye, like the Kachnar. There are exceptions in this species, too, like the Bauhinia blackiana that is sterile, does not bear seeds and, hence, no pods.

But there seems to be no substitute for Koelreuteria (see accompanying pictures). The tree bears yellow flowering panicles, a la mango, that cover the complete canopy. Now is the time this is happening. After about a month, all these flowers will form seedpods in an amazingly beautiful red canopy, again completely covering the plant!

There is an in-between period, too, when the tree wears three colours that come from yellow blooms, green leaves and red pods. I got planted a group of three such trees opposite the entrance of the Chandigarh War Memorial so that these would be the first sight while entering the memorial.

This column appears fortnightly. The writer is a senior horticulturist at PAU and can be reached at satishnarula@yahoo.co.in

Fortnightly Alert

MOST of the time, you find your lawn problematic during winters. It turns brown and does not respond to any treatment. What actually happens is that the grass almost suspends growth with falling temperature. Late mowing contributes to this malady as we remove the top few inches late in the season. Without much growth, the grass base is exposed giving it a barren or dry look.

This is the final call for those who want to trim the grass. Do it now! Add a little of urea by broadcasting followed by copious irrigation and you will get growth that will last through the winter. Do not add and spread sand on spots now to level out your green.

The grass under the sand will remain suppressed and generally get killed by yellowing. You could have done the leveling during monsoon. But if you missed it and have to do it, do so at the end of winters when you expect grass to grow afresh.

This is also the last opportunity for those who grow their own seedlings of winter annuals. A delay now would mean delayed availability of seedlings leading to delayed planting to delayed growth and ultimately improper growth and performance of the bed. Happy gardening! 

Luxury gets new address
Neeraj Bagga

The upscale Ranjit Avenue has emerged as the Chandigarh of Amritsar. Clean wide roads with soothing greenery and footpaths without encroachment offer an ideal location for investors looking forward to construct hotels, shopping malls, restaurants, offices, education centers.

Its popularity can be gauged from the fact that five hotels, including a five star by Holiday Inn, are under construction while four hotels, including a four-star, are already operational! Rendering services to locals and tourists, the splendid architecture of these luxury hotels is a landmark on the skyline of the growing city. Interestingly, all of them are located in close proximity and some even share their boundary walls.

Not just hotels but offices and outlets of fast growing sectors like education, banking, insurance, fashion, apparel stores, government offices, eating joints, restaurants and government offices could be found in the B block commercial area of Ranjit Avenue.

According to chairman, CII, Punjab, Gunbir Singh, land prices have skyrocketed within the last three years and now, no land is available for sale. “Shops and places are available on lease rent only. Owners don’t want to sell off properties as they get handsome returns in shape of rent,” he said. And wy not? Lease rent per square foot has gone up from Rs 20 to about Rs 60 in three years!

The adjoining A, C, D and E blocks of Ranjit Avenue are residential while B block is exclusively earmarked for commercial purposes. A leading real estate developer of the area said that the value of one square yard land in the residential sectors was about Rs 35,000 while the same area cost Rs 1 lakh in Block B. Notably, government prices are fixed much lower.

“Once the under-construction hotels become operational, there would be at least six three-star hotels,” said APS Chatha, general secretary, Amritsar Hotel and Restaurant Association.

Besides, restaurant chains like Domino’s Pizza, Café Coffee Day, Barista, Oka, Yo China, traditional aloo kulchas are also available in sophisticated environs in Kulcha Land! Unlike shopping markets in the walled city and Civil Lines areas, the area offers ample space for parking and its prime location are other attractive features. The labyrinth of arterial roads in the old city and parking blues in Civil Lines do not provide enough opportunity to investors.

Beauty salons of national and international repute like VLCC, Lakme and Jawed Habib have also sprung up in the market. Government offices of Markfed, BSNL, LIC, Passport office, Improvement Trust are also located here. Following permission of the All-India Council for Technical Education (AICTE), the Khalsa College Society has opened its first engineering college over 15.7 acres of prime land in the same area. A number of private coaching centres imparting training for AIEEE, AIIMS and other exams have also set up shop.

Offices of immigration Consultancy services, Tours and Travels, banks, including private and insurance companies are located.

State’s tallest building project scrapped

The state government’s ambitious plan to raise tallest 14-soreyed multiplex and shopping plaza in the locality received a setback as the company called off the agreement recently.

Rocky Farms, said to be managed by the Reliance Group, had bagged the project through a bid last year. The company deposited Rs 47.50 crore out of total cost of Rs 190 crore. As per the rules of the Punjab Urban Development Authority (PUDA) about Rs 20 crore were deducted as fine.

Officials of the company based at Mumbai refused to go on record to comment but said that in all probability, the project had been dropped due to technical reasons. However, insiders said the reasons were more political than economical.

TAX TIPS
To avoid tax LIABILITY, deposit CGT & then distribute money
S.C. Vasudeva

Q. My mother sold some agriculture land. What are the tax formalities? I understand agricultural income is tax-free. She does not want to buy land and intends to give this money to her sons. What would be the tax liability of sons in this regard? — R.K. Jain

A. The capital gain arising on the sale of an agricultural land is exempt from the leviability of capital gains tax if such agricultural land is not covered within the definition of the term ‘capital asset’. In accordance with the provisions of section 2(24) of the Act agricultural land situated in the following areas is covered within the definition of the term ‘capital asset’:

(a) in any area which is comprised within the jurisdiction of a municipality (whether known as a municipality, municipal corporation, notified area committee, town area committee, town committee, or by any other name) or a cantonment board and which has a population of not less than ten thousand according to the last preceding census of which the relevant figures have been published before the first day of the previous year; or

(b) in any area within such distance, not being more than eight kilometre, from the local limits of any municipality or cantonment board referred to in item (a) above, as the Central Government may, having regard to the extent of, and scope for, urbanisation of that area and other relevant considerations, specify in this behalf by notification in the Official Gazette.

The Government of India has issued a Notification No. SO 10(E), dated 6.1.1994 as amended by Notification No. SO 1302 dated 28.12.1999, specifying the distance for the purposes of the coverage of the agricultural land. In case the agricultural land sold by your mother is not comprised within the jurisdiction of a municipality etc. as per (a) above or is outside the limits specified in the aforesaid notification, the same would be exempt from the leviability of the capital gains tax.

In case it falls within the specified distance or within the jurisdiction of municipality etc., the capital gain arising on such sale would be taxable. Any sum received on such sale can always be distributed by your mother to her sons to any extent and in the manner in which she likes, as there is no gift tax leviable in the country on such distribution. I may add that such distribution should be made after the payment of capital gains tax if any, leviable on account of such sale. The amount so received by the sons shall not liable to tax.

To save CGT, must buy house now!

Q. I am a retired government servant, senior citizen and get pension of Rs 8,000 every month. I have not been filing income tax return. I purchased a flat in New Delhi in 1986 for Rs 87,000, paid for freehold conversion charges Rs 26,500 in February 2007, paid Rs 9,080 stamp duty on consideration value of Rs 1,13,500 in April 2007 and sold the same in April 2009 for Rs 6,80,000. Presently, I am not interested in purchasing another house and prefer to live in a rented accommodation for Rs 1,000 a month. Please advise about the arisen LCG taxable amount, tax saving options, when are tax returns to be filed and on which form. If I purchase a house for around Rs 12 lakh in Ambala during this month, what would the scenario then be? — Gagan

A. The long-term capital gain on the basis of the figures given in the query would work out at Rs 2,44,572. You can purchase bonds for the purposes of saving capital gains tax liability. Since the flat was sold in April 2009, bonds will have to be purchased within six months of the date of sale. You can utilise the above capital gain in purchasing the house at Ambala in September 2009 and thereby save tax liability in respect of the amount of capital gain.

Buy bonds within six months of sale

Q. I am a senior citizen above 70. In September 1997, after retirement from a PSU, I purchased a residential plot measuring 197 sq.yd. for Rs 80,000 in Ludhiana (stamp cost Rs 4,800 paid by me). Due to family circumstances, I could not build the house and finally sold the above plot on 17.07.2009 for Rs 5.91 lakh. This deal attracted LTCG (long-term capital gain) on date. In both above deals, I paid 2 per cent due commission to the property dealer but no receipts are available. After purchasing the plot, I spent about Rs 40,000 to build a boundary wall. According to the provision of section 54 f of Income Tax Act, the net consideration being long-term capital gain, while reducing principal amount expenses, I cannot go ahead to acquire any residential house with insufficient amount in hand. Please suitably advise:

n Can I gift this leftover LTCG amount to my daughter or son to get exemption or will I have to acquire/ purchase bonds issued by the Rural Electrification Corp. Ltd. within the stipulated period of date of sale?

n What shall the capital gain amount be in my case?

n I am dependent on my children and have no other income or pension except about Rs 40,000 towards bank interest on saving and deposits. In above deals, can I enjoy the free limit of Rs 2.4 lakh as per budget government announcements during A.Y. 2010-2011? — B.K. Rattan

A. Your queries are replied hereunder:

n The amount of LTCG arising on the sale of the plot can be gifted to your son or daughter. However, the gift so made will not entitle you to claim any tax benefit from the leviability of tax on long-term capital gain. The exemption from tax can be claimed if bonds are purchased in your name within six months of the date of sale.

n The amount of long-term capital gain on the above transaction would work out at Rs 3,37,836. The computation is based on the presumption that you will be able to prove the payment of 2 per cent commission on the purchase and sale of plot and that the boundary wall was constructed in the financial year 1997-98.

n You are eligible to the benefit of the taxable limit of Rs 2.4 lakh as you are a senior citizen. Accordingly, you will be liable to pay tax @ 20 per cent plus education cess of 3 per cent on Rs 1,37,836 (3,37,836 +40,000 – 2,40,000).

Purchase amount surely includes improvement cost

Q. I have purchased a new flat in Gurgaon and have incurred renovation expenditure to make the flat inhabitable. I have included cost of such assets for claiming exemption under section 54 of the Act. The assessing officer, however, is of the opinion that the said amount is not part of the cost of the house property but is a cost of improvement and such costs cannot be taken as cost of residential house for claiming exemption under section 54 of the Act. Please advise whether the action of the assessing officer is correct? — Manmohan Singh

A. Section 54 of the Act provides that where a long-term capital gain arises on the transfer of a residential house, and the assessee has — within the specified period of the date on which the transfer took place — purchased a residential house, then capital gains arising on such sale would be exempt to the extent of investment in the purchase of the new residential house. In my opinion, therefore, the term ‘purchase’ should include other necessary expenditure incurred to make the residential house habitable. The Hon’ble Tribunal in Mrs. Gulshan Bano R. Mukhi vs. Jt. CIT (Mumbai) (83 ITD 649) has held that if a residential house is in a state of general disrepair and is not habitable, necessary repairs carried out to make the same habitable, would constitute part of the cost of the new house for the purpose of claiming exemption under section 54 of the Act.

No tax on gift from kin

Q. In case of HUF property, the main point is how to calculate income tax. When the HUF was split, the value was next to nothing as compared today. In case of gifting the property, is there and gift tax involved? — Brij Moonga

A. The fair market value as on 01.04.1981 should be ascertained with the help of an approved valuer. The value so arrived at will be indexed taking the base year 1981-82 as 100. The cost inflation index notified for financial year 2009-10 is 632. The indexed cost so arrived at will be deducted from the net consideration (sale consideration less expenditure incurred wholly and necessarily for the purposes of sale). The balance amount would be treated as a capital gain arising on the sale of the property. I hope this clarifies the issue raised by you.

Presently, Gift-tax Act 1958 is not in force. There is no gift tax liability under the said Act. The Income-tax Act 1961 (the Act), however, provides that where an individual or HUF receives, in any previous year, from any person or persons any sum of money without consideration, the aggregate value of which exceeds Rs 50,000, the whole of such amount will treated as his income. This provision is also being made applicable w.e.f. October 1, 2009 to a receipt of an immovable or any other property exceeding the aforesaid amount. These provisions are, however, not applicable to a receipt of any sum of money, immovable or other property from a relative as defined under section 56 of the Act.