15 - 05 – 2020

CREDAI Bengal Daily News Update | 15.05.20

WEST BENGAL NEWS

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Newspaper/Online The Times Of India

Date May 15, 2020

OTHER NEWS

Realty developers await debt restructuring, liquidity measures

Given that real estate sector accounts for 6-7% of India’s GDP and employs nearly 10-

11% of population directly and through ancillary industries, realty developers have been

seeking relief in terms of liquidity support and easing debt burden among others.

Following the government's decision to provide 6-month extension for realty projects'

completion, developers are hoping that measures like one-time restructuring or roll-over of debt

and other issues including liquidity enhancement may be unveiled soon.

Given that real estate sector accounts for 6-7% of India’s GDP and employs nearly 10-11% of

population directly and through ancillary industries, realty developers have been seeking relief

in terms of liquidity support and easing debt burden among others.

“Industry is pegging a big hope on much awaited fiscal relief to be granted to the second largest

employment generating sector. Liquidity infusion will be imperative to turn around the

depressed scenario of the sector,” said Niranjan Hiranandani, President, NAREDCO. In the

backdrop of Coronavirus outbreak and its impact on the economy, realtors have suggested that

the debt repayment scheduled over the next 3 months be put off allowing them to repay that in

instalments over the subsequent 12 months.

They have also suggested that interest rate on all realty project loans to be re-fixed at the repo

rate while assuring that the relief will be passed on to homebuyers. “We are hopeful that the

Finance Minister will soon announce other necessary measures by infusion of liquidity, de-

cartelization of cement prices, restoration of supply chain to ease construction on the project

sites and help uplift the demand by offering more sops to homebuyers by increasing the tax

deduction limits for interest on home loans,” said Jaxay Shah, national chairman, CREDAI.

According to them, the declaration of Covid-19 as 'force majure', extension of timelines for

completion of project under the RERA, is expected to provide a breather to the sector that is

grappling with a demand pullback, cash crunch and halt of all construction activity owing to

reverse migration of labourers. However, measures to support liquidity and demand creation

would help the sector gain some momentum.

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Newspaper/Online ET Realty ( online )

Date May 14, 2020

Link https://realty.economictimes.indiatimes.com/news/industry/realty-developers-

await-debt-restructuring-liquidity-measures/75741047

Central government to launch affordable rental housing for urban

poor

The finance minister announced a scheme for affordable rental housing complexes for

migrant workers and urban poor to provide ease of living at affordable rent under

Pradhan Mantri Awas Yojana.

Nirmala Sitharaman, Union Finance & Corporate Affairs Minister on Thursday announced the

second tranche of measures to ameliorate the hardships faced specifically by migrant labours

and housing, among others.

"Migrant workers need affordable and convenient rental housing in urban areas in addition to

social security. The government is attentive to the needs to all the segments of economy and

society," said Sitharaman.

The finance minister announced a scheme for affordable rental housing complexes for migrant

workers and urban poor to provide ease of living at affordable rent under Pradhan Mantri Awas

Yojana.

Newspaper/Online ET Realty ( online )

Date May 14, 2020

Link https://realty.economictimes.indiatimes.com/news/residential/central-government-

to-launch-affordable-rental-housing-for-urban-poor/75740959

Affordable Rental Housing Complexes will provide social security and quality life to migrant

labour, urban poor, and students etc. This will be done through converting government funded

houses in the cities into Affordable Rental Housing Complexes (ARHC) under PPP mode

through concessionaire.

The government will incentivize manufacturing units, industries, institutions, associations to

develop Affordable Rental Housing Complexes (ARHC) on their private land and operate.

They will also incentivize state government agencies or central government organizations on

similar lines to develop Affordable Rental Housing Complexes (ARHC) and operate.

The exact details of the scheme will be released by the ministry/department.

The government also announced the extension of the deadline for the affordable housing Credit

Linked Subsidy Scheme (CLSS) till March 2021.

According to the government, this move will benefit 2.5 lakh middle income families during

2020-21.

"The scheme has benefited 3.3 lakh middle class families so far. By extending the deadline, it

will lead to investment of over Rs 70,000 crore in housing and will create jobs," said

Sitharaman.

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Tax on rent, acquisition of immovable property to be cut: CBDT

The 1 per cent TDS charged on payment made for the acquisition of immovable property

has now been reduced to 0.75 per cent. Payment of rent by individual or HUF has been cut

to 3.75 per cent from 5 per cent earlier.

Tax deducted on payment of dividend, insurance policy, rent, professional fee and on

the acquisition of immovable property has been cut by 25 per cent for a period up to March 31,

the tax department has said.

Following Finance Minister Nirmala Sitharaman's announcement of a reduction in the rate of

tax deducted at source (TDS) and tax collected at source (TCS) for non-salaried payments, the

Central Board of Direct Taxes (CBDT) notified revised rates that will be applicable from May

14, 2020, to March 31, 2021.

Announcing a slew of measures to help companies and taxpayers tide over hardships caused by

coronavirus lockdown, Sitharaman had on Wednesday stated that the reduction in TDS/TCS

rate would release about Rs 50,000 crore in the hands of people.

In the notification, the CBDT said while TCS on sale of the motor vehicle above Rs 10 lakh has

been cut to 0.75 per cent from 1 per cent earlier, TDS on 23 items has been reduced.

The CBDT said TDS on payment for life insurance policy has been reduced to 3.75 per cent

from 5 per cent, while that on dividend and interest as well as rent for immovable property has

been cut to 7.5 per cent from 10 per cent earlier.

The 1 per cent TDS charged on payment made for the acquisition of immovable property has

now been reduced to 0.75 per cent. Payment of rent by individual or HUF has been cut to 3.75

per cent from 5 per cent earlier.

TDS on e-commerce participants has also been reduced to 0.75 per cent from 1 pr cent.

Similarly, tax on professional fee has been reduced to 1.5 per cent from 2 per cent.

TDS on payments in respect of deposits under National Savings Scheme has been reduced to

7.5 per cent from 10 per cent and that on payments for re-purchase of units by Mutual Funds to

15 per cent from 20 per cent.

The same on insurance commission and brokerage have been cut to 3.75 per cent from 5 per

Newspaper/Online ET Realty ( online )

Date May 14, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/tax-on-rent-

acquisition-of-immovable-property-to-be-cut-cbdt/75741800

cent.

TDS on payment of dividend by mutual funds has been reduced to 7.5 per cent from 10 per

cent.

TCS on sale of tendu leaves, scrap, timber, forest produce, and minerals such as coal, lignite or

iron ore has also been reduced.

The CBDT said there shall be no reduction in rates of TDS or TCS where the tax is required to

be deducted or collected at a higher rate due to the non-furnishing of PAN/Aadhaar.

Nangia Andersen LLP Director Sandeep Jhunjhunwala said: "The reduction of TDS and TCS

rates on non-salaried payments by 25 per cent will set free additional cash in the hands of the

vendors, and help increase liquidity in the economy".

"This relief could be enjoyed by all businesses and would play a pivotal role in increasing cash

flows as the beneficial rates would be available until the end of the current financial year."

Deloitte India Partner Rohinton Sidhwa said, "The TDS / TCS cut will release liquidity into the

system. Most assessees would have deluged the tax department with applications for lower

withholding in any case and this effectively will also reduce administrative burden".

PwC India Partner (Tax and Regulatory) Vikram Doshi said, "The immediate reduction of TDS

rate by 25 per cent is a direct and practical measure to increase liquidity in the system. While

there was an expectation of a higher rate of reduction, the longer period of reduction till March

31, 2021, balances the slightly lower rate.

"The extension of due dates of various compliances provides additional relief given the

practical difficulty in undertaking compliances."

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Shortage of workers hits real estate sector hard in Aurangabad

Migrant workers not just do a bulk of the unskilled activities at construction sites, they

are also involved in a range of semi-skilled and skilled jobs in the realty business, said the

realtors.

The mass exodus of migrant workers, after hurting the industrial sector, is now beginning to

affect even on the real estate market.

Migrant workers not just do a bulk of the unskilled activities at construction sites, they are also

involved in a range of semi-skilled and skilled jobs in the realty business, said the realtors.

Officer bearers at the Aurangabad chapter of the Confederation of Real Estate Developers’

Associations of India (Credai) on Wednesday said the revival of the construction business amid

easing of lockdown was possible only after the return of the migrant workers.

“Right from operating ready-mix cement plants to laying floors and carpentry to colouring jobs,

migrant workers have key roles at the construction site. The mass exodus of this workforce has

created a void and we do not know how to cope with it. Only the workers’ return can ensure a

smooth restart of activities in the construction business,” Sunil Bedmutha, secretary of Credai,

Aurangabad chapter, said.

“Workers from Rajasthan, Odisha, West Bengal, Jharkhand and Uttar Pradesh etc. had found

employment at construction sites in Maharashtra. The Covid-19 scare among their family

members back home made these workers homesick. Despite all care and assurances, these

workers chose to go back,” Bedmutha said.

A builder, preferring anonymity, said the real estate sector would remain gloomy at least till

Diwali.

On possible impact of Covid 19 on home prices, Credai has said that government should relax

the tax regime to reduce home prices. “At our end, we are financially constrained to take any

call on prices. The government should reduce stamp duty from 7% to 1% and also do away the

provision of charging GST from buyers. It will help in reducing the prices,” Credai officials

said.

They have already approached MahaRERA with a plea to relax the norms associated with

timely possession of houses to buyers.

Newspaper/Online ET Realty ( online )

Date May 14, 2020

Link https://realty.economictimes.indiatimes.com/news/industry/shortage-of-workers-

hits-real-estate-sector-hard-in-aurangabad/75741651

In Kolhapur, the shortage of workers has hit the small-scale construction sector especially hard.

Sandip Shirodkar, a civil engineer, said, “I have managed to get some local workers. The clients

want to speed up the work, but we are facing a shortage of workers and raw materials. The

supply of special sand required for finishing too has stopped due to lockdown. The cement cost

has been increased. Small-scale construction activities cannot sustain for long like this.

One homeowner, who had to stop construction of his two-storeyed house in Kasba Bawda, said,

“I demolished my old house and started the new one. I am living in rented accommodation and

can shift to the new house only after the construction of the first floor is completed. I have

borrowed money, which I have to repay to the banks. Therefore, the work must be completed

soon. The contractor has very few workers and not enough raw materials. The cost of the raw

materials has also increased and I have to put in additional money to get the house constructed.”

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Chandigarh civic body sends property tax bills to 7,000 residents

The civic body authority has tied-up with the postal department to deliver the tax bills

and all these bills have been sent in vans of the postal department.

The Chandigarh municipal corporation has started the exercise to send property tax bills from

Wednesday. The tax branch has sent around 7,000 bills on the first day.

The civic body authority has tied-up with the postal department to deliver the tax bills and all

these bills have been sent in vans of the postal department.

The property tax bills have been delivered in Sectors 18, 19, 38, 47 and 63. All the bills sent on

the first day are related to the residential areas of the city. The details of the area of both

covered and uncovered portion of the property and area on which the tax has been imposed, is

mentioned in the bills for clarity.

“Though, we are ready with the property tax bills of the commercial areas of the city too, but

since majority of the shops falling in the tax ambit are closed. We have started with the

residential properties only. Once the shops will be opened, bills of the commercial areas will

also be delivered without any further delay. Since July 31 is the last day to file the property tax

amount with rebate facility, residents have ample time to deposit the tax money with the

authority,” said a senior official of the MC.

“There are only two modes of payment for property tax, one is through online mode and the

other is e-sampark centres. There will be no provision of paying the tax money in banks,” he

said.

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Newspaper/Online ET Realty ( online )

Date May 14, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/chandigarh-civic-

body-sends-property-tax-bills-to-7000-residents/75741730

Haryana registers 400 property deeds daily

Haryana has 93 revenue tehsils and 50 sub-tehsils, where registration of properties is

done. Barring red zones, the state government has allowed establishments in other area to

execute not more than 30 deeds each a day.

Amid various restrictions, the work of property registration is gradually gaining momentum

in Haryana, with currently around 400 deeds being executed daily. Till May 12, total 6,890

property registrations had taken place over the last 16 working days since the work resumed,

fetching a modest revenue of Rs 56.52 crore.

Haryana has 93 revenue tehsils and 50 sub-tehsils, where registration of properties is done.

Barring red zones, the state government has allowed establishments in other area to execute not

more than 30 deeds each a day.

Amid various restrictions, the Haryana government resumed registration of properties from

April 20. The registrar offices were directed to have limited number of registries daily to ensure

presence of fewer buyers and sellers.

As the lockdown restrictions continue on people’s movements as well as banking operations

despite some relaxations, the sale and purchase of properties as well as pace of their registration

remains affected.

Enquiries from banks revealed that payments were disbursed only in those cases where the

formalities had been completed earlier. There is a huge pileup of applications for approval of

home loans for want of search reports and other reports to be prepared by the advocates.

“Since some advocates have got movement passes now, the process of sanctioning of loans may

get expedited,” a senior executive of a nationalised bank said.

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Newspaper/Online ET Realty ( online )

Date May 15, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/haryana-registers-

400-property-deeds-daily/75750139

Karnataka cabinet approves ordinance to regularise illegal BDA

properties

Madhuswamy said, while properties on 20x30 sites will have to pay 10 per cent of the

guidance value as penalty for regularisation, 30x40 will have to pay 20 per cent, and it is

40 per cent of guidance value for 40x60 and 50x80 sites.

The Karnataka cabinet on Thursday approved an ordinance aimed at regularising an estimated

75,000 unauthorized properties on the Bangalore Development Authority (BDA) land, by

levying a penalty. According to an estimate, these unauthorized properties are located on about

6000 acres of BDA land, Law and Parliamentary Affairs Minister J C Madhuswamy said.

Speaking to reporters after the cabinet meeting here, he said, "the problem before the

government is- practically it is very difficult to evict them...it has been continuing for long

without any revenue. So based on the subcommittee recommendation, it has been decided to

regularize them."

These buildings are those that have been constructed on lands, which the BDA has not taken

possession yet, he said, adding that "vacant sites are not being regularised to what ever extent it

may be and only those houses which are more than 12 years will be regualarised.

Madhuswamy said, while properties on 20x30 sites will have to pay 10 per cent of the guidance

value as penalty for regularisation, 30x40 will have to pay 20 per cent, and it is 40 per cent of

guidance value for 40x60 and 50x80 sites.

About 45,000 of these unauthorised properties were either 20x30 or 30x40 sites, he said.

Noting that sites exceeding 50x80 will not be regularised, the Minister said for others who do

not fall under the criteria of less than 12 years, BDA will have to take action within two years

for evicting and taking possession of the property.

Revenue generated by this move cannot not estimated now itself, due to varying guidance

value, he added.

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Newspaper/Online ET Realty ( online )

Date May 15, 2020

Link https://realty.economictimes.indiatimes.com/news/regulatory/karnataka-cabinet-

approves-ordinance-to-regularise-illegal-bda-properties/75750177

Telangana building permissions' approval to be implemented from

June

The TS-bPass would allow a citizen to construct a house through self-certification if the

dwelling is to be built within 75 square yards, it said. Rao said the TS-bPass is being

implemented in 87 municipalities on a trial basis.

The Telangana State Building Permission Approval and Self-Certification System (TS-bPass),

which would allow a citizen to construct a house through self-certification if the dwelling is to

be built within 75 square yards, would be implemented in the state from June.

State Municipal Administration Minister K T Rama Rao, who held a review meeting on the

implementation of the system, instructed officials to be ready to implement the TS-bPass from

the first week of June in the state, an official release said on Thursday.

The TS-bPass would allow a citizen to construct a house through self-certification if the

dwelling is to be built within 75 square yards, it said. Rao said the TS-bPass is being

implemented in 87 municipalities on a trial basis.

While officials have been verifying the applications, a few buildings have already received

permission.

About 1,100 applications have been received till now, it said.

He asked the officials to upgrade the required infrastructure and enhance training for the

employees to ensure hassle-free transactions.

He told them to work towards providing online approvals, once the complete system is in place,

it said.

The minister instructed the officials to provide various online options (Mee Seva citizen service

centres, Mobile App) for the citizens to send in their applications, apart from the offline

registrations.

A call centre is also being set up for those who have any queries.

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Newspaper/Online ET Realty ( online )

Date May 15, 2020

Link https://realty.economictimes.indiatimes.com/news/industry/telangana-building-

permissions-approval-to-be-implemented-from-june/75750243