The South Delhi Municipal Corporation standing committee on Tuesday approved the proposal to simplify the process of conversion of leased commercial properties to freehold in 38 markets.
So far, a person getting a shop allotted was required to get permission from authorities before transferring the ownership right of the leasehold property to another person. In case of non-compliance, a penalty of Rs 3,000 per year was imposed. The civic agency on Tuesday proposed to waive off this condition.
“Now, the person won’t need to seek permission from the authority concerned before transferring the leasehold property,” said leader of House Narendra Chawla.
Also, there is a proposal to change the condition, which requires the person who gets the shop allotted to pay 50% of the unearned increase to the civic agency during transfer of the leasehold property. The unearned income is the difference between the market value of the property at the time of granting of lease and the existing market value.
“Suppose a leasehold shop was transferred to a person by the authority for an amount of Rs 5 lakh and after some time, the person transferred this lease property to a second person at Rs 10 lakh. To get the property freehold, the person is supposed to pay 50% of the difference of these two amounts (Rs 2.5 lakh) to SDMC. But we have suggested to change this norm in our recent proposal,” said an SDMC official.
According to the new terms, the person will be required to pay conversion charges at the time of getting the property freehold, which will be 10% of value of circle rate of property multiplied by area of shop. In addition to this, he/she will need to pay 33% of this conversion amount as transfer fees to SDMC.
The 38 markets, which were transferred by L&DO to SDMC, have 1,252 shops located at Lodhi Road Complex 1 and 2, MB Road, Pushp Vihar (Sector 1 to 4 markets), HUDCO place, Sadiq Nagar, Y-shaped building near ITO and Mohamadpur Shopping Complex.
