HIT or MISS?

Integrated townships in suburban areas offer a solution to the unavoidable urban chaos. Charandeep Singh on how successful or otherwise these township projects have been in Patiala

Patiala is a city with historical significance having a twin character. One, is the old city, around the Qila Mubarak, and the other is where city has expanded residential colonies. With the boom in real estate sector another dimension has also been added to the city. It is — Townships. Two major townships have been launched in Patiala over the past few months. Real estate group Omaxe is building the one on the Sirhind Road,, and the second is Sunny Enclave, being built on the Patiala-Pehowa road by Bajwa Builders. But will the residential flavour of Patiala absorb all these settlements? Would townships become favourite dwelling units of Patialvis?

Patiala is basically a middle class city, which is a hub of salaried population. So, affordable houses are the bottomline. It has been observed that people in Patiala like to be comfortable independent houses. As a result flats are not a piece of hot cake in real estate scene of Patiala. PDA Omaxe city, Patiala, has been developed under a Joint Development Agreement between Punjab Urban Development Authority (PUDA) and Omaxe Ltd. Built over an area of approx 336 acres. It has freehold plots in the area ranging from 200 to 1350 sq yd on offer. The township is a gated complex with 24x7 security, underground cabling and wireless connectivity, round the clock water supply etc.

Another township coming up in the vicinity of PDA Omaxe City is Tricone City, which was launched in June, 2009. Tricone City is a residential township spread over 85 acres, and is a 100 per cent FDI company by the name of Tricone Projects India Limited. “Out of 85 acres, 54 acres have been developed, and CLU has been obtained for balance 31 acres,” said Col. K.J Singh, vice-president, operations and coordination.

The third major township coming up in Patiala is on Patiala-Pehowa road — Sunny Enclave. Plots, showrooms, booths and built up houses are on offer here.

In between lines

Though on paper the trend seems to be catching up fast, in reality the situation of development and success of townships in Patiala is not that rosy. B.D. Juneja, a major real estate player of Patiala, feels that most of these townships are on the outskirts, where accessibility is a major problem. With Patiala being a tier lll city, even small distances are considered big. Lack of a proper mass transit system is also a deterrent.

In some cases the location too has played spoilsport. According to J. S. Bajwa, managing director, Bajwa Developers, “ The initial response to our township was lukewarm because the location was not very congenial as there was a big garbage dump of Municipal Corporation in the vicinity. After our request, the corporation has agreed to shift the dump. Now there is a vegetable market coming up in the vicinity, including the bypass road. Things are headed for a bright future,” says Sumeet Singh Saini, senior market manager of Bajwa Developers.

Another major hurdle is the cost of land in these townships as land is available within city areas for almost the same price. So many of the potential buyers think twice before striking a deal at these townships. At Omaxe the rates range between Rs 5,000 to Rs 9,000 per sq yard and in Sunny Enclave the land that was developed in the first phase can be procured at about Rs 8,000 per sq. yd and in the recently developed territory the price is about Rs 5,500 per sq. yd. At Tricon plots of various measurements, with easy payment schedule and credit facility can be procured at a price of Rs 5,450 per sq.yd on down payment and Rs 5,950 per sq yd on installments.

However, the developers claim good response for their projects. According to Jetaish Gupta, DGM with Omaxe, “We received about 10,000 applications against our offer of 300 plots.” As per Gupta, “ Patiala for the first time is getting an integrated township in an area of about 350 acres and the township is a public private model, whereby both the Omaxe Corporation and the Punjab government are stakeholders.”

But in reality the buyers, as of now, are mostly investors who have purchased plots and apartments in the townships to sell these of for profit once the reality sector recovers from slowdown as Juneja says that “sellers are more than the buyers”.

Everyone wants to sell off their land and make money. This might be one of the major reasons of townships taking more time to take off than what is normally required.”

Agreeing with this Bajwa says that, “Even after five years of the launch, only 60 per cent of the project is sold off and the occupancy level is very less with only 8-10 families residing in Sunny Enclave.”

Since the stakes are high in the development of townships, the stakeholders are in for a long haul. It is a wait and watch situation as of now.

Satellite Urban Village

A satellite urban village differentiates itself by being more than 100 acres in size and having development constituents that make it fully sustainable. Satellite urban villages use urban design principles, to give a high standard of living with pollution-free and highly supportive environment through its infrastructure and support amenities at a walkable distance. Normally, the satellite urban villages involve a planning period of 12-18 months from the date of consolidation of land to get to the stage of marketing the project. Due to the large format of these projects, the residents get more open and green spaces. Satellite urban villages normally have multiple housing options to cater to a wider range of customers. Since the satellite urban villages offer better facilities and amenities and “walk to work and play options”, they are occupied faster by families and the high occupancy levels make them safer residential destinations.

Township Trend

According to Rajinder Gupta, retired Chief Town Planner of Punjab, “there are two set of guidelines for the development of townships in Punjab — one is within the Municipal limits, and the second is outside these. A minimum of 50 acres is required to develop a township in Punjab and this kind of land is available only on the outskirts of the municipal limits, which is why most of the townships are on the outskirts of big cities.” The bulk of construction in an integrated township is residential plots and development (47.75 per cent). Roads parking and utility form 32.3 per cent, housing for economically weaker sections is about 5 per cent, for the development of institutions is 9.5 per cent, for commercial development is about 4.75per cent. Parks and open spaces constitute about 5.7 per cent. “ Townships are designed to be self-sufficient with physical infrastructure like road, power, sewerage etc and social infrastructure like school hospital, retail, entertainment areas, mass transit system etc, ” says Gupta.

GROUND REALTY
Magic of steel

Last few years have seen a complete switchover to stainless steel kitchen sinks. Ceramic or chinaware sinks used earlier are fading from the kitchens. Sensing the trend, the manufacturers have flooded the market with many models of stainless steel sinks.

Here are a few guidelines to make the right choice when it comes to stainless steel sinks:

Number of bowls

A stainless steel sink may have a single bowl, two bowls, three bowls, single bowl with drainage board, two bowls with drainage board, two bowls with two drainage boards, two bowls in L shape with central drainage board and three bowls with drainage board. Further, the bowls may be of equal or unequal sizes. Decide which system you want for your kitchen. Normally, a two-bowl sink with or without a single drainage board should be preferred.

Shape

Sinks are produced in many shapes. It may be rectangular, square, L-shaped or curved. Prefer a rectangular sink if a double bowl sink is chosen and a square or rectangular sink if single bowl is chosen. Don’t choose a curved shape sink. Also see that inner radius of sink is small so that maximum capacity is achieved in minimum space.

Thickness

A thicker sink provides better service and durability and also helps in reducing the noise that steel sinks usually make. Thickness also acts against dents. See that the sink steel is not less than 1.2 mm in thickness. Some companies produce sinks of even 1.6 mm thick steel plates. However, such sinks are costlier.

Gloss factor

Stainless steel sinks come in three types of finishes — glossy, satin and linen finish. Sinks with glossy finish are the cheapest. Those with satin finish are costlier and the ones with micro linen or linen finish are the most expensive. Purpose of this finish is to give a sparkling look to the sink and its easy cleaning after use. A sink that can be cleaned of all the greasy stains after use should be chosen. Normally, satin finish sinks should pass this test. See that cleaning doesn’t require hard detergents or scrubbers.

Steel quality

Stainless steel sinks should be made of AISI 304 grade stainless steel. To be more precise, the steel should have at least 18 per cent chrome and 8 per cent nickel in it. Looking for higher grades of stainless steel will unnecessarily increase the cost of the sink.

BIS confirmation

Prefer to choose a sink that conforms to IS 13983, the ISI mark issued by Bureau of Indian Standards for stainless sinks to be used for domestic purposes.

Depth

Depth of sink is an important factor. Stainless steel sinks are not as deep as the ceramic or chinaware sinks. Indian cooking conditions demand deep sinks for bigger utensils as cookers and karahis. Always look for the deepest steel sink possible. Most of the branded stainless steel sinks are 7 to 10 inch deep. Some reputed companies also produce 10 to 12-inch deep sinks. Right method of checking the depth of sink is to measure it vertically near the waste drain.

Time to buy

Decision over size of the sink and number of bowls in it should be taken before the water supply pipes for the faucets and waste pipes connecting the sink drain pipes to the drainage system are laid by the plumber in the kitchen wall. Preferably, the sink should be purchased at that time itself and kept at a safe place. This will allow the plumber to know the exact location of water outlets and waste pipe. Otherwise, at a later stage, the wall fittings may need to be removed and re-laid causing unnecessary wastage of time and money.

Prefer to choose a double bowl single faucet sink. Faucets are so shaped and positioned that these can be swiveled to open water flow in any bowl. Whenever, there are space constraints, choose a corner sink with two bowls at right angles and a central drain board in between. The tap is at the centre and can be turned towards any bowl. Look for the removable vegetable washing bowl.

This column appears fortnightly. The writer is deputy chief engineer, civil, PSEB.

TAX TIPS
Sale of agricultural land
S.C. Vasudeva

Q. I have purchased agricultural land in January, 2009 for Rs 5,00,000 now I want to sell it for Rs 12 lakh. Is this income taxable under the capital gain?

— Mahesh Aggarwal

A. The amount of capital gain from the sale of agricultural land would be taxable provided the land is situated-

In any area 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 10,000 according to the last preceding census of which the figures have been published before the first day of the previous year; or

In an area within such distance, not being more than 8 km from the local limits of the municipality etc. referred to in (a) above as the Central Government may, specify in this behalf by notification in the Official Gazette. In case the agricultural land that you intend to sell is outside the limits specified in (a) or (b) above, the capital gain arising on such sale would not be taxable. In case the capital gain is taxable, it will be a case of a short-term capital gain as the agricultural land has not been held by you for more than three years.

Wife not eligible for rebate

Q. Me and my wife are employed in different banks. We purchased a plot in joint names in equal share for Rs 6,50,000 in December 2001. I constructed a house by taking a loan for Rs 12 lakh loan from my bank and the total construction cost was Rs 25 lakh. My bank has taken the guarantee of my wife as the plot is in her name also. I am paying Rs 8,000 per month as installment of the house loan from my salary. If my wife also repays the loan by cash or by cheque from her account, will she be eligible for rebate u/s 80C of the Income Tax Act, 1961. She is not a borrower but guarantor and co-owner of property.

— Bhupinder Singh 

A. Section 80C of the Act provides for the deduction of the repayment made by the assessee towards the construction of a residential house. The deduction is allowable within the maximum limit of Rs 1 lakh specified in the aforesaid section. It may not be possible for your wife to get the deduction of the installment toward the repayment of loan as she is not a borrower of the amount for the purposes of construction of residential house.

Helping son to buy a house

Q. My son wants to purchase a built-up house at the approximate cost of Rs 50 lakh. He has got Rs 10 lakh to invest. Suppose I sell my own house at a total cost of Rs 40 lakh. Can I give this money i.e. Rs 40 lakh for the purchase of new house by my son. Please tell whether I can directly give this money to the builder or I have to give him through my son’s account. Will I get tax benefit on long-term capital gain on the sale of my own house by doing so? If this is not possible as per Income Tax rules, then can I gift a sum of Rs 40 lakh to my son for purchasing a new house in his name? If it is possible what is the procedure to gift such amount and what is the limit of gift.

— S. Kumar

A. The queries raised by you are replied hereunder:

It is evident from the query that the house is to be purchased in the name of your son. Accordingly, the payment of Rs 40 lakh to the builder directly by you would not enable you to get relief as to the chargeability of the tax on capital gain arising on the sale of your house.

You can gift the amount of Rs 40 lakh to your son without any tax liability. However, the sale of the house would entail a tax on the capital gain arising on the sale thereof. The taxability of capital gain would be dependent upon the period for which the house was held by you. In case the same was held for more than three years, you would be liable to pay tax on long term capital gain @ 20 per cent plus education cess of 3 per cent thereon.

The writer can be contacted at sc@scvasudeva.com