REAL ESTATE |
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area watch: gurgaon
Homebuyers keep realty scene vibrant The demand for residential units has remained high in Gurgaon with buyers exploring the potential of new areas like Dwarka Expressway Sunit Dhawan Saturation in the commercial property segment and delay in getting possession of residential apartments have made investors in the National Capital Region (NCR) tread cautiously in their real-estate endeavours. While owning property in posh locations in the NCR still remains a distant dream for mid segment end-users, investors are still hopeful of a robust scenario at least in the residential property sector in the near future.
Tax tips
REALTY GUIDE
decor trends
Green house
16 pc drop in housing sales
realty bites
launch pad
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area watch: gurgaon
Saturation in the commercial property segment and delay in getting possession of residential apartments have made investors in the National Capital Region (NCR) tread cautiously in their real-estate endeavours.
While owning property in posh locations in the NCR still remains a distant dream for mid segment end-users, investors are still hopeful of a robust scenario at least in the residential property sector in the near future. Realtors maintain that the sizeable investments made in commercial property in cities like Gurgaon and Faridabad during the past few years have led to stagnation in the prices as well as in the sale-purchase activitiy in this category. No let up in demand for residential units However, the investors’ craze for owning flats or apartments in these cities continues to soar, especially in the wake of recent developments. “Connectivity with Metro rail network and commissioning of the Badarpur flyover have ensured better connectivity of Faridabad with Delhi. Hence, the city is witnessing an upswing in demand for residential property, especially for flats in group housing societies,” observes Rajiv Nagpal, a real-estate agent based at Faridabad. Dwarka Expressway — the new destination In the case of Gurgaon, the entire focus of the realtors as well as investors has lately shifted to the Northern Peripheral Road (NPR) — popularly known as the Dwarka Expressway, which provides an alternative route from Delhi to Gurgaon. Apart from its close proximity to the national capital and international airport, the NPR also connects to the Delhi-Jaipur National Highway-8 passing through Gurgaon. In view of the provisions in the Gurgaon-Manesar Masterplan, the area along the Dwarka Expressway has the potential to become a premium investment destination in the long run. The 150-metre-wide and 18 km-long Dwarka-Gurgaon Expressway touches Delhi near Dwarka Phase II, where a new diplomatic enclave is being developed along side the Metro network running parallel to the road. On completion, the area is touted to become one of the hottest real-estate zones in New Gurgaon. The NPR would provide a new link between Dwarka and Palam Vihar, connecting Dwarka with Gurgaon through an eight-lane expressway starting from Dwarka and connecting Palam Vihar in Gurgaon, and joining it to NH-8 via Gurgaon-Jhajjar Road passing through Dhankot village on the outskirts of Gurgaon. The new expressway is also likely to decongest the existing Delhi-Gurgaon link roads including NH-8, MG road and the Old Delhi Road. Apartment prices appreciate No wonder, the builders as well as investors are going gaga over the hype created about their ventures in this territory. Thanks to their enthusiasm, the rates of residential apartments have seen up to threefold increase in the past three to four years. While residential property rates in Faridabad presently veer around Rs 4,000 per sq ft, those in Gurgaon along the Dwarka Expressway are largely in the range of Rs 5,000 to 6,000 per sq ft. Commercial gains remain elusive Nagpal maintains that there was hardly any growth or movement in the commercial property market as those who had already invested in this segent had not got returns or appreciation on the expected lines. In fact, most of the malls in the city continue to await tenants and the desired footfalls. Like Faridabad, the commercial property segment seems to be downbeat in Gurgaon as well, at least as of now. “The first and foremost concern of an investor is the returns. While a flat can be sold or rented/ leased out right away, shops and office-spaces have few takers unless there is a reasonable commercial value in the area. And as commercial value attains a respectable level only after an area is well-populated, it takes time to grow,” points out R.P. Katyal, an investment advisor based in Gurgaon. Sore points Nonetheless, the delay in completion of the NPR project as well as grant of possessions of residential units by the builders have started to dampen the spirits, though the property dealers like to call it a passing phase. Anyhow, not wanting to take the big risk of blocking their money, the prospective buyers are investing in small and mid-segment residential flats and apartments.
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Tax on sale consideration of house
SC Vasudeva Q. I am currently living in the UK. I own a flat in Delhi, which I had got from my father. I am planning to sell the flat. The buyer also stays in Delhi. I don't plan further investment upon receiving the money. How much tax will I have to pay in case I sell the flat.
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jagdish rai A. Your query does not indicate the period for which you as well as your father have held the flat that you intend to sell. If the flat has been held for more than three years by you and your father, the same will be a long-term capital asset. For determination of long-term capital gain, the cost of such flat should be known. If the flat was purchased prior to April 1, 1981, then you have an option to adopt fair market of house as on April 1, 1981 for the computation of long-term capital gain. Such long-term capital gain would be the amount of difference between the indexed cost price and indexed fair value as on April 1, 1981 as the case may be, and the sale price of the long-term capital asset. You will be liable to pay tax on the amount of long-term capital gain. Such tax should be paid on the dates on which advance tax is payable by an individual assessee i.e. September 15, December 15 and March 15. In case long-term capital gain arises after the date on which advance tax installment is payable, the amount of tax shall be payable in one or two installments as the case may be. At present the long-term capital gain is chargeable to tax @20% plus education cess of 3% thereon.
Confusion over investing capital gain Q. I owned a residential plot, which was purchased during 1984-85. I sold this plot during the financial year 2010-11. The amount received could not be deposited in capital gain account with the bank and capital gain tax was not paid. However, the whole amount was deposited as an FD in a bank. This amount was withdrawn and a new residential plot was purchased during the financial year 2012-13, that is within two years of the sale of the first plot. Now my question is whether any action can be taken for not paying the capital gain tax, particularly considering that the whole of the amount was spent for purchasing a residential plot within two years even though it was not deposited in Capital Gains Account before filing the return? —
rameshwar gupta A. On the basis of the facts given in the query, the capital gain arising on the sale of residential plot would be a long-term capital gain as the residential plot was held by you for more than three years. The exemption from tax under Section 54F of the Act is available in respect of the long-term capital gain arising on the transfer of any long- term capital asset, not being a residential house if the net consideration received on transfer of a long-term capital asset other than the residential house, is invested in the acquisition of a residential house within a period of one year before or two years after the date of the transfer of such capital asset or in the construction of a residential house within a period of three years from the date of the transfer of such capital asset. Since you have acquired a residential plot and not a residential house within a period of two years, it may not be possible for you to claim the exemption from tax in respect of the long-term capital gain arising on the sale of the residential plot. You would be liable to pay tax on capital gain arising on the sale of the plot. It would be advisable to revise the return for the assessment year 2011-12 before March 31, 2013 and pay the tax due along with the interest. In case you have not filed return for assessment year 2011-12, the same can be filed by March 31, 2013. The amount of tax due along with interest will have to be paid before filing the belated return.
Is the insurance claim taxable? Q. We are a partnership concern. The firm had been allotted a small area in a plot in the industrial area. On account of a fire due to short circuit, the building had been destroyed completely. The same was reconstructed after getting an insurance claim from the insurance company. What is the status of the insurance money received from the insurance company? Is it taxable? —
kk sood A. In one of its decisions, the Supreme Court had held that insurance claim received on account of destruction of a shed is not chargeable to tax as the destruction does not amount to a transfer of an asset. Thereafter w.e.f. 1.4.2000 Section 45(1A) has been inserted in the Act and in case the following two conditions are satisfied, any profit or gain arising from the receipt of such insurance amount shall be chargeable to Income-tax under the head ‘capital gain’. The conditions are:
Should co-owners pay service tax individually? Q. There are three co-owners of a commercial property situated in Chandigarh which was inherited under a Will by them. The property is let out to a nationalised bank. The rent prior to March 31, 2012 was received in the name of the executor of the Will and he used to distribute it to the co-owners. From April 1, 2012 the rent has been received directly in the names of three co-owners even though there is only one lease agreement. The total annual rental income of each owner is less than Rs 10 lakh. But the total annual rent received from the property exceeds Rs 10 lakh. Kindly inform:
— ramesh chander
A. According to Section 66B of Chapter V of Finance Act 2012, there shall be levied tax on the value of service, other than those specified in negative list, provided or agreed to be provided in taxable territory by one person to another. Clause (a) of Section 66E of the Finance Act 2012 specifies the renting of immovable property as a declared service. In view thereof the rent received from property would be subject to service tax. In the case cited in the query it seems the service provider was the deceased because the rent was being received in the name of the executor. It is presumed that the inheritance has been recognised by the tenants and it is on the basis that the rent is to be paid to the legal heirs. If the ownership of the legal heirs has been recognised and the payment of rent is to be made individually on the said basis, it may then be possible to claim the limit of Rs 10 lakh by each of the co-owners. This opinion is based on the premise that the service is being provided by each of the co-owners for the identified share of property leased to the bank. |
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Is it safe to buy property in auction?
B K Sanghi Q. I want to purchase a flat in a group housing society which has been put on auction by a nationalised bank in Zirakpur (Punjab). Is it safe to purchase a property in public auctions conducted by banks?
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sk sharma A. It is fairly secure to purchase a property from banks. Banks allow public to look through the property documents. Before participating in their auction process, make sure the following: 1.Make sure that the bank had obtained NOC from appropriate authorities such as housing society etc before sanctioning the loan. 2.If the flat being purchased comes under a housing society, verify the membership information of the existing owner. 3.Take advice from a lawyer to perform a search on the property to ensure the property is clear from all encumbrances (that means there are no legal issues to the property as per the government records). 4.A Debt Recovery Tribunal (DRT) handles the legal issues related to these sales instead of the typical civil court system. This ensures a speedy resolution to most legal issues. 5.If you are the winning bidder at an auction, the bank would give you a Sale Certificate. This Sale Certificate is equivalent to the Sale Deed in a normal purchase. Register this Sale Certificate like a Sale Deed. This Sale Certificate is the most important document for the purchaser. Make sure there is absolutely no clerical mistake on this certificate. If the details of the property have changed since the bank granted the loan to the previous owner, make sure the sale certificate issued to you contains updated information. 6.It is not required for the purchaser to contact the previous owner as they are not in legal possession of their property. It is the responsibility of the bank to take possession of the property before the auction. It is a good idea to not disclose your purchase to anyone until you obtain a Sale Certificate. 7.Consult a lawyer to execute the registration of the Sale Certificate. Make sure an authorised officer from the bank is available to sign on the registration documents.
Q. I am living in Gurgaon and want to purchase a flat in a group housing society. The builder has not given the possession as yet although the building is complete. I have come to know from a source that the builder has not taken the occupation certificate/completion certificate so far. What are the risks in buying a builder’s flat without completion certificate/occupation certificate? —
abhinav gupta A. Apart from ensuring that basic amenities such as water, electricity and sewerage are provided, a completion certificate ensures that the builder/owner has constructed the building according to the approved building plan. Without obtaining the completion certificate, the builder can’t give the possession of the flat to the buyer as it is illegal. You can’t live in the flat until you have obtained completion certificate. Completion certificate of a property comprises the sanction of Drainage system; Drinking water; Fire fighting system ; Sewage treatment plan ; Solar system etc. from the local authorities. |
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Don a modern mantle
Sukhmani Bhore
If you are finding your existing decor a bit too traditional and want to change the look without making major changes, there are a few things that you can change around the house that will help you to achieve the modern look. Modern or contemporary style is ‘the style’ of the year. It is simple, subtle and sophisticated. It highlights space rather than things. The contemporary decor is sleek and stylish and focuses basically on colour, space and shape. Colour The first thing you can do to give a modern look to your house is to change your paint colour. Get rid of the green and blue walls and paint them cream or white. Contemporary interiors feature tone-on-tone colour palettes. Neutrals, whites, browns and black work best for modern homes. The colour palette can be perked up with vibrant accessories. Flooring Hardwood flooring, vinyl, polished concrete and stone finish go well with the contemporary décor. Do away with wall-to-wall carpets and show some floor. In case you don't want to spend too much on changing the flooring of the whole house, replace your existing traditional carpets with modern rugs with geometrical patterns or solid colours. Fabrics Natural fabrics such as silk, wool, linen and cotton are used for their textural aspect and inherent neutral hues. However, bold colour or geometric pattern may be brought into the design with pillows, a rug or a throw. Get rid of your dainty floral prints. Furniture The most distinct element of this style is its straight lines. Add pieces that are straight and sleek. The look should be clean and uncluttered. Furniture should have straight lines with no frills, trims, curves or carvings. Shine Contemporary rooms are nothing if not polished, and that means high-gloss surfaces fit right in. Chrome, steel, lacquer, glass, plastic, tile and more all work in tandem to help bounce light around a space. Mix materials for contrast and depth. Too much shine will make you uneasy therefore remember to break up the gleam with matte elements. Accessories Your accessories should be few, simple, large and well chosen. Place them strategically to create a focal point in the room. Do not clutter up the room; try placing one accessory per surface. In contemporary decor always remember that less is more. Wall art Walls in contemporary rooms don't usually have much in the way of adornment: no heavy mouldings, no plate collections, and no family photo groupings. So they're a perfect foil for large works of art. As for the artwork, use large paintings with bright colours or a group of black and white paintings. The frames can be wood or chrome finish. Replace your traditional paintings with abstract and modern art. Window coverings Windows in a contemporary house are usually abundant, and they're often left undressed to highlight their crisp lines and to let the natural light flood in. Usually privacy is an issue in most houses therefore, window blinds or eyelet curtains work best with this style. Do not use any lace, frills or tassels. Get rid of sheers and keep the look simple. Bedrooms To get a modern look in a bedroom add a platform bed. Replace everything that has carvings with something straight. Even your vanity mirror must be straight lined. Kitchens Keep it clean: the door style you choose should not have decorations and ornate details. Frameless cabinets, and perhaps a little glass, will work well in a contemporary kitchen. Use larger tiles instead of small. If you use grey, silver and black tiles for your kitchen, accent it with bright coloured dishes like red, blue or yellow. Generally, in a contemporary kitchen, the colour scheme is eye-catching. Use contrasting colours or a complementary colour scheme based on your cabinetry, appliances, etc. Bathrooms Since contemporary is all about straight lines, bathrooms too need to feature straight, clean and neat lines. Whether it is the bathroom cabinets, the bath fittings or the bathroom vanity, the silhouettes have to be minimalistic, uncomplicated and simple. Make use of mirrored mosaic tiles in the bathroom and accent with bright colored towels and
candles
The writer is Interior and landscape designer and can be contacted at www.archtechsolutions.com |
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Small gardens can make a big statement
CS BEWLI Low-maintenance garden is an option for those who are unable to employ a full-time gardener and also have less time to take care of their plants. Such a garden, if planned carefully, can give the effect of an extension of interior designing to the space outside the living area in which plants are used creatively to match or contrast the overall décor effect. Even if the area of the garden is very small, it can be transformed into a beautiful de-stressing garden.
Small beds along the lawn can be used for planting annuals. However, raised flower beds made with contrasting concrete, brick, stone or metal maximise space and go well with annuals. By creating different levels the garden will appear bigger. For a real low-maintenance garden, no place should be left open as open spaces invite the growth of weeds. The open spaces can be decorated by ‘hardscaping’ which brings an element of elegance, class and uniqueness to any landscape. Alternatively, depending upon the time available low-lying ground cover of buddelia, chlorophytum, alternanthera, cuphea and sedum gives a good look. For those who neither have enough space nor time to give to a lawn, container gardening is a rewarding option; a unique container garden can be created by planting flowering perennials and annuals. Light-weight fibreglass or plastic designer containers about 18-22 cm in depth are ideal for annuals, while those with 25-30 cm depth are good for perennials of reasonable size. The containers should have holes at the base. A majority of the annuals are suitable container plants and can reward you with enviable vibrant flowers. In addition to these hanging baskets can also be made to utilise vertical space, and dish gardens that last for a few years and need less maintenance can be created. Gravel and pebbles are the latest versatile tools to create a distinctive feature which gives an ornamental touch to any garden. These are used for creating pathways and as ground cover in geometric or designer forms in the garden. Colourful glass pebbles can also be used as a ground cover, but when used in flowing water, they give a different and an eye-catching look. To avoid weeds growing through the gravel or pebbles, a plastic sheet should be placed underneath to make this low-maintenance. If space permits, a small seating arrangement or a swing should be arranged to add comfort in enjoying the features created in the garden, but care should be taken to ensure privacy by also planting some tall flowering shrubs. The boundary wall should be covered with flowering climbers such as begnonia, qusiqualis, heliotropium and bush rose instead of hedges to give additional space to add grace to the garden by allowing these to grow vertically. Alternatively, for hedge lovers, hedge of perennial and evergreen Clerodendrum enerme is an ideal choice.
Low maintenance plants
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Housing sales have declined by 16 per cent to nearly 2.10 lakh units during 2012 in the top six cities as high property prices and costlier home loan affected demand, property consultant Knight Frank said in a report.
The new launches of homes, too, fell by 30 per cent with developers shying away from announcing fresh projects. Delhi-NCR, Mumbai, Pune, Bengaluru, Hyderabad and Chennai are the six cities tracked by the Knight Frank. “A lacklustre residential market in 2012 was plagued by high property prices, relatively higher mortgage rates, weak business sentiments and a bleak employment scenario. This is reflected in the launches, which declined by 30 per cent in 2012 in comparison to a fall of 7 per cent in 2011,” it said. These six cities witnessed launch of 2,41,811 homes in 2012 as against 3,43,142 dwelling units in the previous year, an official said, adding that absorption declined to 2,09,787 units in 2012 from 2,49,127 homes in the previous year. “Amidst faltering economic growth, residential sales momentum for the top six cities also took a beating; absorption in these cities has fallen by 14 per cent and 16 per cent during 2011 and 2012, respectively,” the report said. Developers have now become more rational in launching their projects, taking cue from the market, it observed. “This can be clearly seen by closely studying the gap between the launch and the absorption numbers. This gap reduced to 32,000 units in 2012 compared to 82,000 and 94,000 units in 2010 and 2011, respectively,” Knight Frank said. The NCR led the residential market in terms of absorption as well as launches during the three year period of 2010-2012. The two biggest residential markets i.e. NCR and Mumbai account for almost 60 per cent of total absorption, followed by Bengaluru (13 per cent), Pune (11 per cent), Chennai (9 per cent) and Hyderabad (7 per cent). The consultant said the housing loans disbursed by banks have consistently grown in double digits since July-2010, but growth momentum has tapered off alarmingly since June 2012.
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realty bites
Income Tax (IT) department sleuths raided the business centres of real estate developers Vatika Group and its associate firms in Gurgaon earlier this week and seized documents, including computer hard disks, a company official said. “The IT officials also searched the houses of the big bosses of the company. Several files, documents, central processing units (CPUs), hard disks and compact disks (CDs) were seized by the raiding team,” said the official, who did not wish to be named.
Several business centres and offices of authorised property dealers of Vatika Group were raided by the Income Tax Department officers. The main team, with several members, including a woman IT officer, headed by a commissioner level officer, searched the multi-storey head office Vatika Triangle of the group situated here on the Mehrauli-Gurgaon (MG) road. The exercise lasted for several hours. The site office of the Vatika in Sector 82, a developing residential township in 700 acres was also raided, the company official added. A senior officer of Haryana Police who was along with the raiding team said on the condition of anonymity that “the offices of authorised property dealers of Vatika, including a office in Bristol Hotel and on Sohna road near Raheja Mall were also searched and a few files and computer items were seized.” “The raids were conducted after the complaints of financial irregularities in the upcoming and current projects of the Vatika Group. Mainly, in the resale of plots and flats in the upcoming residential, commercial and other projects in sectors from 82 to 99,” said an authorised property dealer who, too, did not wish to be named. Gaurav Bhalla, one of the top executives of the Vatika did not respond to the phone calls by IANS. The Vatika Group plans to invest about Rs 250 crore in the next five years on expansion of its business centre venture, which provides fully-furnished office space and other services to clients. Vatika Business Centre, a subsidiary of Vatika Group, has eight business centres in Gurgaon, Bangalore, Hyderabad, Pune and Mumbai covering more than two lakh sq ft of office space.
IndiaHomes to foray into loan servicing biz Real estate brokerage firm IndiaHomes will be investing $ 20 million through private equity infusion over the next two years to fund its foray in home loan servicing as well as to expand geographical reach, a top company executive has said. “We are planning to invest around $ 20 million over the next two years which would be largely used for home loan servicing for our customers ,” IndiaHomes Managing Director Samarjit Singh told PTI recently. The company, has so far invested around $ 14 million for expanding its operations in the country. These funds were raised through a mix of private equity infusion from Helion Venture Capital India and US-based Foundation Capital and through its promoters. The company will be establishing a separate entity ‘India Loans’ to take care of the loan servicing business, he said. “Today it has become very difficult for buyers to get home loans as they have to undergo a number of procedures. In our endeavour to provide end-to-end solutions, we now want to be a one stop shop where customers can not only get their dream home but also guaranteed loan and all the necessary advices,” the MD said. — Agencies
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launch pad
Realty group Era Landmarks is all set to launch its IT Square in Greater Noida. Spread over more than 15 acres the IT Square is located at Knowledge Park 3, and is one-of-its-kind multipurpose project with dedicated commercial and IT spaces with retail, entertainment and eating joints and cafeteria. Designed on the concept of “work, live and play”, it has landscaped green areas, with services and fully furnished studio apartments and a proposed institution. In addition to a top-of-the-line infrastructure, the premises is soon going to have a star rated business hotel also. River Crest at Rudrapur Supertech Limited has announced the launch of a river-side township River Crest in
Rudrapur, Udham Singh Nagar. The township will have villas and apartments to meet the demands of buyers in
Rudrapur. The villas will be made along the river. Conceptualised in the SIDCUL area of Rudrapur on the National Highway-87, River Crest is spread over the area of 24 acres and offers 196 plots with areas ranging from 150-350 sq yd and 97 villas with plot area options ranging from 250-500 sq yd. Speaking on the occasion
R.K. Arora, CMD, Supertech Limited said, “The township will offer a unique experience to buyers. With the best of facilities and easy connectivity, the project will also attract the corporates and industries making the region a perfect real estate avenue”.
Marina Home to invest 500 cr in India in 5 yrs Dubai-based home furnishings company Marina Home plans to invest Rs 500 crore in India to open around 50 stores across the country in the next five years. The company, which sells entire range of home interiors, including living room accessories, lighting fixtures and fabrics, is aiming at Rs 300-400 crore turnover in its very first year of operations in the country. “Our target is to have 50 stores comprising large and medium-size boutique stores across metro, tier I, tier II and tier III cities in the country,” Marina Gulf and Marina Home co-founder and co-owner Khurshid Vakil told PTI. He added that the company, which has stores across the Middle East, would fund the expansion in India through internal accruals. When asked about the revenue targets in India, Vakil said: “We are expecting to touch Rs 300-400 crore in revenues in first year itself”. The company recently opened its first store in the National Capital and has already invested around Rs 100 crore on various activities including, infrastructure, logistics and distribution network. Marina Homes further plans to invest Rs 100 crore in 2013 to come up with company-owned large format retail stores in metros and medium sized boutique stores in smaller cities. “In the first phase, we plan to open four large company-owned stores this year in metro cities. It will be followed by boutique stores through franchise route across smaller cities and towns,” Vakil said. He added that the company is also looking to tie-up with major builders to secure real estate projects. —
Agencies
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