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Delayed dreams
The realty sector is trudging along a tough path in the first quarter of 2012 with buyers in the wait-and-watch mode and cash crunch, increasing raw material prices and low sale volumes adding to the developers’ woes. For all those who have already taken a plunge into the realty market by booking residential units delayed projects come as another dampener in this scenario as most of the developers, big and small, are missing the completion deadlines at an alarming rate.  Click
here to see complete list of delayed projects
real issues: rent act
Ground
Realty
realty bites
Godrej properties forays into Chennai
Coveted certification
tax tips
launch pad
big ticket
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Delayed dreams
The realty sector is trudging along a tough path in the first quarter of 2012 with buyers in the wait-and-watch mode and cash crunch, increasing raw material prices and low sale volumes adding to the developers’ woes. For all those who have already taken a plunge into the realty market by booking residential units delayed projects come as another dampener in this scenario as most of the developers, big and small, are missing the completion deadlines at an alarming rate. The situation has been particularly worrisome in the realty hotbed of the Delhi-NCR region with just 23 per cent projects launched before 2008 being completed by January 2012, as per a survey report released by real estate research firm PropEquity recently. The research study by Gurgaon-based firm talks about the projects that were launched during January 2007 to June 2009, and were expected to be delivered by January 2012. About 1,920 projects in the metropolitan regions of Delhi, Mumbai and Bangalore were evaluated for the survey. A majority of the delayed projects are in Noida, Faridabad, Ghaziabad and Gurgaon. All these areas saw a massive upsurge in residential projects in the wake of commercial and IT boom in the national capital and its suburbs. A number of developers, including major players like DLF, Unitech, Ansals, Omaxe etc and several new and smaller developers launched a number of projects before the realty bubble burst in 2008. However, most of these projects went in a limbo in the face of fund crunch, slowdown of economy, increased borrowing costs and sluggish demand. “Lack of foresight and a reckless ‘me-too’ attitude by developers has led to a large percentage of the projects being delayed for occupancy. Many of these, launched in 2005-06 with assurances of possession by 2008-2009, are yet to be completed”, says Santhosh Kumar, CEO (Operations), Jones Lang LaSalle India. As per Kumar as many as 63 large residential projects in NCR (accounting for almost 40,000 units) are delayed by over four years and out of these, around 10 projects (9,000 units) have been delayed by over six years. This includes projects wherein possession of a small percentage of units has been handed over, while most of the whole project remains incomplete. Citing lack of vision in execution of a project as a major cause for this huge ‘hung’ inventory, Samir Jasuja, founder and chief executive officer at PropEquity said, “One of the reasons is also that as the realty market picked up post-subprime crisis several projects were announced, but the developers did not have the execution bandwidth for it, and in several cases they used funds raised from one project to acquire land bank.” “Delays in obtaining regulatory sanctions, shortage of labour and construction materials have also contributed to extending the execution timelines”, says Sanjay Rastogi, Director of Saviour Builders Pvt Ltd. Kumar adds lack of initial capital to start the project on time, socio-political situation in the adjoining areas/state, delay in procurement of material, issues of land acquisition and unplanned and hasty launches to the list of main reasons that have led to the missed deadlines. The delays crump the buyers as well as the developers with financial woes. While the customers have to deal with the additional EMI burden, builders have the sword of delay-penalty clause hanging over their heads. “It is mandatory for builders to include a penalty clause. Under the penalty clause, the developer is supposed to pay compensation to buyers in case of a delay. Along with the completion date, most developers include a grace period of three to six months. The penalty clause gets invoked after this grace period and the rate of compensation is usually 5-7 per cent per sq. ft for each month of delay”, explains Rastogi. With 92 per cent of the delayed projects in the NCR falling in the affordable category and 76 per cent delay in mid-end housing projects, thousands of buyers who have taken home loans are caught in this quandary. Though most of the builders are claiming that they would hand over possessions by the end of this year as the projects are at the finishing stage and would be completed in the next few quarters, thousands who have been dreaming of a home of their own are keeping their fingers crossed. Any further delay would prove to be very costly for the health of NCR’s realty sector.
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real issues: rent act
The growth-oriented rent Act notification that had been quashed on constitutional grounds still finds favour with the Chandigarh Administration. The notification will bring tenants in the UT out of the ambit of the protection offered by the rent Act. A move to re-notify the notification, through proper norms and process this time, shall be welcomed by all but a few who have vested interests. The issue of a balanced and 'fair' rent Act has gained importance as the Union Urban Development Ministry is planning to resurrect the rent control Act first in the capital and thereafter, if the states are willing, in all major metros. A draft rent control Act that will fix different tariff bands for business and residential premises is being prepared at the ministry level. This would act as a model for entire nation. A major consideration in having a 'fair' rent Act should be the fact that the demand and supply forces should govern the rentals as even the tariffs of essentials like petrol and diesel are based on the demand and supply factors. In the era of Public-Private Participation where even infrastructure projects are being carried out on BOT basis through user charges, continuing the obsolete rent Act protection to a small section of society has no logic. Controlling provisions in the rent regulation Act ought to be introduced under certain emergent conditions like war, natural calamities such as earthquakes etc when a large displacement of population takes place. The process of decontrolling should start as soon as the situation normalises. Enacted during World War II in 1941 freezing rent rates of 1939, the East Punjab Rent Restricted Act, 1949, was extended to Punjab after independence as a large displacement of population took place during the Partition. Initially implemented for a five-year period, the Act was never thought to be repealed for political vested interests. The union territory of Chandigarh also comes under the ambit of this Act. This Act has turned out to be a source of misery for property owners. The government while pursuing reformative and progressive policies has to counter the unjustified resentment of tenants. Their resentment, however, springs from a very common human behavioral trait of criticising the withdrawal of a benefit, deserved or undeserved, being enjoyed by someone. In the case under reference a privileged protection enjoyed by the tenants for the past three generations is being withdrawn; so they have a very valid but unjustified reason to be worried.
Sore points in the Act l There is wide disparity between the prevailing market rents and properties 'grabbed' on old rents - a major cause of conflict. Benefits of low rents are not transferred to the customer but are enjoyed by a few individuals; rather the tenants who are paying rent at the current market rates have to compete with the 'grabbers'. l
A tendency to declare low business turnover proportionate to the low rentals amounts to revenue loss to the state exchequer in shape of indirect taxes - a major source of black money. More revenue can be generated through income tax from owners receiving rents on market rates. l
Property related crimes get encouraged as 'occupied' properties on desperate sale are bought by influential people who get these evicted from anti-social elements.
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The protective umbrella of rent control leads to under-supply of accommodation and this results in slow growth and increase in rentals and landlord-tenant disputes. The rent control Act compounded by tenancy protection dilutes the property rights of the owners and subsequently discourages the investors to offer accommodation on rent. The real estate sector as a whole needs a regulatory body to oversee and formulate regulatory measures like fixing rents justifying the demand and supply conditions from time to time. Let there be a level playing field for both tenants as well the owners. The model Act, better to be named as rent regulation Act, should be provisioned to protect the rights of the tenants as well as the owners. Growth needs participation of one and all. Reformative measures like repealing of the rent control Act have resulted in considerable upward swing in the real estate market. Construction activity has picked up considerably generating ample employment opportunities as about more than 250 industries are directly related to the construction sector. The rentals have come down considerably with urban India offering wider choices of accommodation. The writer is Gen Secretary, Property Owners' Welfare Association Chandigarh
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Antique
grace While prices of real antique pieces have soared steadily, there has been a mushrooming of made-to-order look alikes. If connoisseurs have treasured antiques as glorious relics of an era gone by, no less proud are those whose drawing rooms are cluttered with fakes bought from modern furniture shops. But the fake business, too, is flourishing. And one manufacturer of replicas reasons thus, “You can’t call this piracy. In fact, fakes are keeping alive the demand and desire for genuine antiques. Even if you have all the money in the world, there are simply not enough genuine pieces going around.” The craftsmen to look for are those who make furniture which is almost as authentic as the real stuff. They are extremely fastidious about the wood they use, the texture and polish, the carving, and in fact, the overall impact made by a piece bearing their stamp. It is no wonder that a quality duplicate antique is priced prohibitively. Colonial Legacy Antique furniture available in India is not more than 200 years old and most pieces in the market are of a mere half century vintage. It is mostly colonial legacy. Instead of lugging heavy baggage, the Britishers got copies of furniture back home made by Indian artisans. Some of the earliest cabinet makers in India were faithful copiers of the designs imported from England, France and Holland. They made replicas of Chippendale, Rocco and Baroque designs which are now found only in museums and palaces. Soon the aesthetic sensibilities of Indian artisans took over and they superimposed European patterns with Indian designs. The craftsmen of Kashmir with their carving of the chinar leaf were particularly adept at this technique. Most of these pieces were bought by the upper-class Indians and also the royalty. Which explains why much of the genuine antiques have been salvaged from the rundown havelis and palaces of Rajasthan, Gujarat, Punjab, Madhya Pradesh and other states. However, as interior designer Vana Sidhwa says, “There is no set method by which one can find out whether a fake is being passed off as a genuine piece. One just has to look closely enough. All that is required is a discerning eye. Yet, counterfeit antique furniture can fool even the most experienced eye.” Spurt In Demand The sudden spurt in demand is in direct proportion to the spending power of the middle class which is willing to splurge on anything that is `in'. Commenting on this trend Sidhwa says, “It sometimes hurts me to sell a prized piece to people who don’t appreciate the value but want it as a status symbol.” A large chunk of Sidhwa’s clientele comprises foreign diplomats who, she says, are eager to delve into the entire history of the piece they are buying. But there is not enough awareness or interest among Indians. “Many, of course, just want antiques for status and usually don’t care whether they are real or not.” However, prices of original antiques are an aspect that few are willing to speak about. While Sidhwa says that to furnish a two-bedroom apartment with antique furniture could cost at the very least “between three and five lakhs,” others say prices are not mandatory. As one manufacturer puts it, “Pricing is ad hoc, dependent on how passionately the customer wants it". A genuine antique chair could sell for anything up to Rs 50,000 to 2 lakh, depending on the design, wood and carving. A jharokha frame turned into a mirror could fetch up to Rs 25,000, an entire console anywhere between Rs 30,000 and Rs 75,000. What is even more profitable is exporting antique furniture. No wonder the dealers are excited by the new fangled craze for musty old wood. — NF
Maintenance Tips Cleaning Cloth Use a fresh, soft and moisture absorbent cotton cloth and wipe gently on the surface of the antique furniture. Polishing Never compromise on the quality of polish. Use the best available once a month, unless there are some spills and spots that have to be removed immediately. Avoid Do not expose antique furniture to direct sunlight or high humid conditions. In fact, shield the furniture from extreme changes in temperature. Coaster and Pads It is important to protect the furniture surface from hot dishes, glass stains and vases by using protective pads and coasters. Repairs It is always best to call for professional help to repair damaged antique furniture. Attempt repairs only if you are confident of doing them.
Strike a perfect deal l
Inspect the piece carefully from all sides in bright light. l
A genuine piece normally should have a used look and wear and tear around knobs. l
It should not have any visible nails and their presence may be the sign of a sloppy repair job l
Check if drawers open and whether any part has been cleverly replaced l
Always get a second opinion when buying an expensive piece.
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Ground
Realty RCC has become the universal material to cast the intermediate floor slabs or roof slabs of houses because of its excellent strength and durability. Generally, these slabs have many beams located in them. The beams are provided to transfer the load on the slab and of the slab to the walls or columns below the beams. The layout of the beams is to be decided carefully to create a complete supporting grid for the slab. The slab supporting grid of the beams has the walls or columns for transfer of load to the foundations. This way, the load is safely transmitted to the ground.
The beams provided below the slabs are either simple rectangular beams or inverted beams. These days, the practice of providing inverted beams has caught momentum. Popularity Inverted beams are becoming popular these days. Every architect prefers to provide inverted beams in the slab. The reason for this is that the projected portion of the beam above the slab surface gets hidden in the floor sub-base laid over the slab and is never visible. On the other hand, if a rectangular beam is provided, it projects below the slab bottom and is visible in the rooms below. This projection is not liked by the architects and house owners. Technical Aspect Technically, an inverted beam is not better because in such a beam, the advantage of using slab portion as beam flange is lost. In a normal rectangular beam, cast monolithic with the slab, the beam acts as a T-beam and certain slab portion contributes as a part of the beam. But in inverted beam, this advantage is lost. Drawbacks Inverted beams suffer from many drawbacks. A layman doesn’t realise these drawbacks and opts for inverted beams shown by the architect in the drawings. The onus, thus, is on the architects to convince a house builder to accept rectangular beams for better strength and durability of house instead of going for a superficially attractive but weak structure. Improper Construction Inverted beams are never constructed at site in a proper manner. The masons lay the concrete in the slab portion and leave the steel portion of inverted beams projecting above the slab surface without concrete. Cement slurry that has fallen on this steel during concreting of slab dries up which is undesirable. After the laying of slab concrete, the balance portion of the inverted beam is made up with concrete, creating a joint in the beam at slab level. This is totally an improper way of construction. No Shuttering It is not possible to provide any side shuttering for projected portion of inverted beams. The steel of the slab and the beams has to be laid first. No shuttering can now be erected over the laid steel. In the absence of shuttering, the designed width and depth of beams is not achieved at site thus putting a question mark over the load-carrying capacity of the beam. At the most, the masons erect wooden planks or bricks on the two sides of the beams, when the slab has hardened. But these planks or bricks don’t provide necessary support. Odd Shape In the absence of shuttering, the masons round up the edges of inverted beams as it is not possible to lay sharp edges and corners of the beams when no shuttering support is there. Rounding off the edges of beams results in reducing the section of beams and the beams in actual don’t carry the load these are designed for. No Compaction Again, in the absence of shuttering, it is not possible to apply vibrator to the concrete laid in the projected portion of inverted beams. The concrete laid in inverted beams is, therefore, not compacted well. Its density reduces and chances of honeycombing in it increase to a great extent. Often such honeycombing is visible when the masons remove the temporary wooden planks or bricks erected on beam sides. The masons hastily repair this by applying mortar on beams. This mortar application, however, doesn’t help in restoring the strength of beams. Lean Mix As it is not possible to apply vibrator to the concrete laid in inverted beams, the masons ask for a leaner concrete mix for the projected portion of beams. The mixer operator adds more than required quantity of water to concrete being produced, increasing its water cement ratio. This directly affects the quality and strength of the concrete, putting the whole structure under risk. No Curing Another disadvantage of inverted beams is that these are never cured well. After the laying of concrete in slab and beams, a water pond is created on the top of slab for its curing for 14 days. However, the projected portion of inverted beams remains uncured. At the most, water is sprinkled over this portion of beams once or twice in the day which is inadequate. Some vigilant house builders arrange jute bags to cover the projected portion of beams. These bags retain water for a longer period. However, vigil has to be kept that these bags remain wet all the time as the projected portion of beams is subjected to direct sun. (This column is published
fortnightly)
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The thickness of a slab is generally 5 to 6 inch while the depth of a beam is 9 inch or more. The difference in the depth of beam and the thickness of slab either projects above the slab surface or below the slab bottom. Inverted beams are the beams that project above the top surface of slab. Rectangular beams, simply called beams, are the ones projecting below the bottom of the slab surface. l
Suppose the thickness of slab is 5 inch while the depth of a beam is 12 inch. Therefore, the difference of 7 inches will either project above the slab surface or below its bottom. The beam with 7 inch projection above the slab surface is an inverted one.
Design remedy False ceilings are in these days. These can be provided in the portion where rectangular beams with larger depth have been provided. False ceiling can easily hide the beams and make the ceiling look attractive. In case the false ceiling is not to be done due to cost factor, it is better to accept the beams projecting below the slab than going for improper construction.
Advantages of rectangular beams l
Proper shuttering has to be necessarily erected for laying the rectangular beams and masons can’t escape erecting their shuttering, as is often done for inverted beams. l
Full compaction of concrete can be done. l
The concrete mix can be kept stiff and no extra water is required to be added to it. l
Rectangular beams are economical than inverted beams. l
Proper bed plates can also be provided below the rectangular beam ends for transfer of load. l
In short, rectangular beams have all the advantages. Their only disadvantage is their visibility in the rooms below.
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realty
bites
DLF has launched a special scheme for the government and defence officials. The scheme offers discounts ranging from 3 to 5 per cent on residential developments in Jalandhar, Panchkula, New Chandigarh, Bangalore, Chennai, Shimla and Kochi. DLF currently has nine premium residential developments across these seven cities. From a case to case basis discount value will vary from Rs 1 lakh to Rs 20 lakh. The offer is valid only on direct bookings till March 15, 2012.
Speaking about the offer, Mohit Gujral, Vice-Chairman and Managing Director, DLF India Ltd. said, "We are glad to introduce this special rebate for the people who work relentlessly in the service of the nation. It is DLF's humble tribute to their services. The scheme aims at encouraging end users to be part of these ongoing developments". The projects on which the scheme is applicable are : DLF Valley, Panchkula, Hyde Park Estate, New Chandigarh, Park Place, Jalandhar, Samatara, Shimla, Commanders Court, Chennai, Gardencity, Chennai, Maiden Heights, Bangalore, Riverside, Kochi and New Town Heights, Kochi. DLFset to pocket 700 cr from Gurgaon project Realty giant DLF will soon launch a luxury housing project in Gurgaon with an expected sales realisation of about Rs 700 crore. According to sources, the company will offer 562 premium apartments in the project 'Regal Gardens', which is spread over 11 acres. The project is part of the 450-acre integrated township Garden City in
Gurgaon.
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Godrej properties forays into Chennai
Godrej Properties Ltd. (GPL), the real estate development arm of the Godrej Group, has launched its first residential project, Godrej Palm Grove, in Chennai. Spread across 12.5 acres, this premium residential project consists of 16 and 19 storey towers, offering a total of 1,556 modern apartments. Customers can choose from amongst 2 and 3 BHK apartments that range from 1,188 sq. ft to 1,489 sq. ft.
The project offers amenities like a 22,500 sq. ft club house, a swimming pool, gymnasium, a squash court, a tennis court, a skating rink, a central plaza, intercom connectivity, a department store, reticulated piped cooking gas, a meditation center and a party hall. The project has been pre-certified Gold by the Indian Green Building Council (IGBC).
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Coveted certification
EMAAR MGF Land Ltd, has been awarded the coveted ISO 9001:2008 and ISO 10002:2004 certification for its customer service function. The group has projects under development in the NCR, Mohali, Indore, Jaipur, Lucknow, Chennai, Hyderabad, Kolkatta etc.
While the ISO 9001:2008 certification specifies quality management system within the organisation, the ISO 10002:2004 provides guidance on the process of complaints handling related to products within an organisation. The company was honoured for enhanced customer satisfaction through the effective application of the system, including processes for continual improvement of the system and the assurance of conformity to customer and applicable statutory and regulatory requirements.— TNS
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Property held beyond 3 years is long-term asset
S. C. Vasudeva Q.A residential plot was allotted to me by HUDA in 1992 and possession was offered in 1998. I have paid installments regularly paid and non-residential penalty has also been deposited every year. However, I could not get possession and some amount/interest is outstanding. People say that before selling a Conveyance Deed has to be signed with HUDA after clearing the account and taking physical possession. Thereafter, the land can be transferred to the purchaser by a Sale Deed. Kindly advise whether gain in my case will be a long-term gain or not?
A.The Section 2 (42A) of the Income-Tax Act 1961 (The Act), provides that the capital asset not being shares of the company or any other security listed in recognised stock exchange in India or a unit of a mutual fund or zero coupon bond held by an assessee for a period of more than 36 months will be treated as a long-term capital asset. Therefore, a residential plot held by you for a period of more than three years after the date of possession, shall be treated as a long-term capital asset and any gain arising on the transfer thereof shall be treated as long-term capital gain. No construction means no tax exemption Q. Kindly clarify the following points: n Is there any rule that specifies a certain percentage of the capital gain amount to be spent towards the cost of land and the cost of construction? n Can I spend the entire amount of capital gain for purchasing a plot only or do I need to carry out construction also? — manish l
There is no specified percentage of capital gain which is required to be utilised towards the cost of land and cost of construction. I may add that the requirement under Section 54F of the Act is to utilise the amount of net consideration (not the amount of capital gain) towards the purchase or construction of a residential house. l
You would not be allowed exemption under the Section 54F of the Act in case the net consideration is utilised for the purchase of a plot only and no construction of a residential house is effected thereon within the specified period.
Not entitled for capital gain tax exemption 30-04-2001 Application money Rs 63,000 (10 per cent of the cost of plot) 19-02-2002 On Allotment Rs 94500 (15 per cent the total cost of plot) 23-01-2003 Ist Instalment of Plot Rs 78750 08-12-2003 Interest Rs 64260 23-01-2004 2nd Instalment Rs 116631 Rs.78750 + Interest of Rs.37881 24-01-2005 3rd Instalment Rs.113402 Rs.78750 + Interest of Rs.34652 27-01-2006 4th Instalment Rs.104739 Rs.78750 + Interest of Rs.25989 29-01-2007 5th Instalment Rs 92925 Rs.78750 + Interest of Rs. 14175 13-03-2008 Last Instalment Rs.87500 Rs.78750 + Interest of Rs.8750 The Conveyance Deed of the above plot was executed on February 11, 2011 on which Stamp Papers Amounting to Rs 43,150 + Registration Expenses of 5,000 were incurred. The above plot was sold on April 25, 2011 for Rs 23,92,000. I had purchased another plot for Rs 18,82,500 on April 26, 2011 for construction of a residential house What will be Capital Gain on sale of above plot of Rs 23,92,000. — Surinder Kumar Aneja
A. The capital gain arising on the sale of the plot allotted to you by HUDA would be treated as short-term capital gain, as the same has not been held by you for a period of more than three years. The amount of Rs 15,28,143 {23,92,000-(Rs.8,15,707+43,150+5,000)] being the gain arising on the sale of the plot would be added to your total income and brought to tax at the normal slab rates. You would not be entitled to claim exemption under Section 54F of the Income-Tax Act as such benefit is available in respect of long-term capital gain. 1. By way of Will 2. By way of Registry 3. Any other method — Ranbir Singh
A. You can make a gift of the un-constructed plot of 175 sq yd to your daughter. This would necessitate the execution of a Gift Deed in favour of your daughter. Such a Gift Deed will have to be registered with the Sub-Registrar of the area where you are based. Such registration would require payment of stamp duty on the market value of the plot. You can also make a Will whereby the plot devolves to your daughter after your death. The Will should preferably be registered at the Registrar's office. The cost involved in such a case would be minimal. The other method is to transfer the said plot to your daughter for cash consideration. This would require payment of tax on the capital gain arising on such a sale. In my opinion, execution of Will in favour of your daughter would be simple and less costly method.
Alternate Solution
Q. A query by Ravi Shankar published (on January 14, 2012) in these columns mentioned that he intended to sell a plot purchased in 1998 and buy another plot in Hyderabad in his son's name. He wanted to know of the Capital gain be exempt from tax?
Your advice was that exemption shall be available only if the Hyderabad plot is purchased in his own name, as per Section 54F of the Act. However, I am of the view that Ravi Shankar should first gift the plot to his son (no gift tax) which attracts very nominal tax (on transfer of property) as this is a gift to blood relation. The son should then sell the plot, and in order to claim exemption he should purchase the plot in Hyderabad for construction of the house, where he can get finance to construct the house at very low rate of interest. Is this the correct way? — Nripander Parkash Khanna A. It should be possible to act in accordance with the suggestion given by you. However, gift of plot to the son by Ravi Shankar would attract stamp duty computed on the basis of market value of the plot. It would not involve any income-tax liability as the gift would be to a 'relative' as defined in Section 56 of the Act. Ravi Shankar would, therefore, have to consider whether the payment of stamp duty would be worthwhile or it would be better to make the Will in favour of his son in respect of the said house.
What is the fair market value of plot? Q. I sold a plot measuring 42 m2 on November 25, 2011 @ 38640Rs/m2 for Rs. 16,22,880. The built-up area is 20 m2 @5600Rs/m2 which cost Rs 67,200. So the total cost is Rs 16,90,080. The Circle Rate is as per Category F. Please tell me what will be the fair market value of the above-mentioned plot (as on April 1, 1981)? — Teja Singh
Q. In continuation to your reply of query published on February 18, 2012 please advise me on the following points regarding tax liabilities arising out of the purchase and sale of a HUDA plot:
Plot purchased in February 2007, by way of registered deed, (no HUDA liability pending as on date of purchase) Amount: Rs 6,54,000 (excluding broker charges and registration expenses of Rs 65,000). Plot sold in February 2012, Amount Rs 16,34,000. Entire amount is to be reinvested in purchase of a flat costing Rs 30,00,000 (approx). For that, Rs 8,00,000 has been paid in December 2011 (application amount) and the remaining amount of Rs. 22,00,000 is to be paid in May 2012. (to avail a discount of 7 per cent offered by the builder if full amount is paid in advance). Please advise: As the possession of the flat would be handed over to me in 2014 (builder's promise), whether this investment could be considered as utilisation of consideration arising out of sale of a capital asset other than a residential house towards purchase of a residential house? If not then what could be the tax liability arising out of this transaction? — Ashwani Raheja
A. The capital gain arising on the sale of the plot shall be in the nature of long-term capital gain. You would be entitled to claim exemption from the taxability of such a capital gain under Section 54F of the Act provided the purchase of the flat is effected within two years of the date of sale of the plot. It would, therefore, be in your interest to get possession of the residential flat within two years after the date of sale of the plot. In case you are not able to comply with the above requirement, the tax liability arising on the capital gain would be Rs 1,12,579 (20.6 per cent of Rs 5,46,495, being the amount of long-term capital gain). email your queries to
sc@scvasudeva.com ...
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launch pad
Tata Housing Development Company announced a tie-up with Arvind group earlier this week to develop Rs 1,600-crore integrated township and launched Rs 8-12 lakh low-cost housing in Ahmedabad.
"We have partnered with Arvind Real Estate (an Arvind textile group company) to develop 135-acre integrated township in Ahmedabad," Tata Housing Managing Director and Chief Executive Officer Brotin Banerjee said recently. The township would be developed by a special purpose vehicle (SPV) Arvind and Smart Value Homes. In the first phase, it would launch 1,091 flats under the Tatas' low-cost housing brand, 'Shubh Griha'. "This is our first real estate project in Gujarat. The Shubh Griha scheme has been launched here following its success at Boisar and Vashind in Maharashtra (outskirts of Mumbai)," Banerjee said. At present, Tata Housing has 46 million sq ft under various stages of planning and execution and an additional 19 million sq ft in the pipeline. It is offering dwelling units in a price range of Rs 5 lakh to Rs 14 crore. Banerjee said that since the target for Shubh Griha project was middle and lower income groups, the company has tied up with micro-finance organisations which could provide loans to people working in unorganised sectors. "The booking of the houses will begin immediately and in the next 24-30 months the buyer would get the possession of the apartment," he added. Banerjee also announced that in the next 6-9 months Tata Housing would be launching another phase of the township which would have bigger homes of 1000-1200 sq ft. Arvind Group Chairman Sanjay Lalbhai said the project was crucial for his company. "We were very keen to bring something very unique to Gujarat, which we have been able to do with the Tata Housing by launching the township," Lalbhai said. He further said Arvind Real Estate has large land-bank with big chunks in Gujarat and Karnataka. "We have been monetising the land till date, but now we have entered a second phase and want to develop it," Lalbhai said. Arvind Real Estate CEO Kamal Singal said the upcoming project would improve cash flows for the real estate firm in 2012-13. "Arvind Real Estate has around 32 million sq ft land under construction at present in six projects in Ahmedabad and Bangalore," he said. — PTI
Golfforeste Club Retreat Paramount group launched its club house - The Club Rretreat - at Golfforeste recently. The 100-acre Golfforeste project in Greater Noida will have luxurious villas and studio apartments along with a 6-hole golf course and other world class amenities. The club house has world class infrastructure and facilities such as sauna spa, jacuzzi, multi cuisine restaurants, A/V rooms etc. Speaking on the occasion Ashwani Prakash, Executive Director, Paramount Group said, "Golfforeste will provide luxury-in-affordability like villas and apartments and the "Club Retreat" is the first phase of this luxury-in-affordability.
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big ticket
Real estate player Sunteck Realty has acquired a 16-acre plot for Rs 300 crore at the northern suburb of Goregaon.
“Kotak Realty (private equity firm) has funded the project to the extent of Rs 150 crore. The balance has been paid through internal accruals,” Sunteck Realty Chairman and Managing Director Kamal Khetan told PTI. Prior to the acquisition, the company had seven acres in the area and its land bank in Goregaon has increased to 23 acres after the acquisition. “Goregaon has emerged as the next most valuable destination for the company with 23 acres involving two projects, which would involve roughly 5-6 million sq ft of developable area,” he added. A project proposed on 16 acres will enable the company to develop about 4 million sq ft of multi-use development with a predominant share of residential units in addition to commercial and community retail locations. On timeframe for completion of both projects, he said, “we expect to get clearances in the next 6-9 months. Once that is in place we will prepare a detailed plan.” — PTI
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RCC has become the universal material to cast the intermediate floor slabs or roof slabs of houses because of its excellent strength and durability. Generally, these slabs have many beams located in them. The beams are provided to transfer the load on the slab and of the slab to the walls or columns below the beams. The layout of the beams is to be decided carefully to create a complete supporting grid for the slab. The slab supporting grid of the beams has the walls or columns for transfer of load to the foundations. This way, the load is safely transmitted to the ground.
Tenants and owners are both vital organs of society. Tenants, on one end, need an accommodation, the owners, on the other side, also look forward to a reasonable return from their investments.
To purveyors of high fashion romance is more than just bricks, marble, gold and burgundy interiors. It is now in antique furniture. As ethno chic has come into vogue again, the hep are scampering back to the past. Old is suddenly beautiful and for the elite, the quest for antique and period pieces as furniture has reached a feverish pitch.
What are inverted beams?
—A.Sharma
A.Your queries are replied hereunder:
Q.I had been allotted a plot by HUDA , the necessary detail of which is given hereunder :-
Q. I own a 175 sq yd plot and a 250-sq yd constructed house. Both of these are registered in my name in Punjab. My wife expired sometime back and I have a son and a daughter. While my son is living in India, my daughter is an NRI. I want to transfer the plot in the name of my daughter. Kindly advise which of the following will be an easy, simple and cost-effective method of doing so:
A.You will have to approach an approved valuer for the purpose of determining the fair market value of the plot (the details of which have been given in the query) as on 1.4.1981. It will not be possible for me to determine the fair market value on the basis of the details given in the query. The approved valuer will have to visit the site. A report will be given by him in a prescribed format detailing measurements etc. of the plot. Such report will also describe the nature of construction, rates adopted for valuation of the constructed area, the method adopted for the valuation of the plot of land and building separately. The report as given by an approved valuer will have an evidentiary value.