My first query & a challenging one : housing soceity lease deed compulsion before reselling.
Tayib
(Querist) 15 January 2013
This query is : Resolved
Hi,
I am the member of a Co-Op Housing society ltd incorporated under the Maharashtra's Co-operative Societies Act 1960. The Soceity since 1999 has alloted plots to its members. I am the first owner and I am in possesion of Share Certificate & Allotment Letter for my plot which is vacant. I now want to sell the Plot however i did not get a lease deed done or paid any stampduty or registration charges till now.
The housing soceity states that i need to prepare a lease deed and have the registration done before i can sell it to someone else. This despite i have to pay 5% of govt valuation as Tranfer fee to housing soceity.
My Questions are:
1) Is it mandatory for the soceity to make me prepare and register and pay stamp duty before i can sell to my friend.
2) If Yes, do i have to pay stmap duty & registration on current price? And will that invite penalty too? I purchased property 13 years ago and plot was vacant since then.
3) Cannot i seel the property to my friend and who in turn opts for a lease deed and have registration done directly on his name?
Tayib
(Querist) 15 January 2013
Urgent info will be appreciated.
Raj Kumar Makkad
(Expert) 16 January 2013
1. Yes.
2. Stamp duty is payable at the current rates and no penalty is required to be imposed as you are paying stamp duty at current rates. You are already penalized in this way.
3. In such way, you shall be stealing State revenue.
Tayib
(Querist) 16 January 2013
Thanks Raj.
1) What i understand is that, i need to pay stamp duty and get it registered both. Am i right?
2) And i need to do this before i can sell the plot?
3) Does the Housing society need to ensure that the land/plot is registered before accepting transfer of shares to the buyer party? Or is this between and upto the buyer and seller whenever they want to do it?
Raj Kumar Makkad
(Expert) 16 January 2013
1, Yes.
2. Yes.
3. Society shall ensure it.
Tayib
(Querist) 17 January 2013
Appreciate the input Raj. A quick question on the same transaction:
A few points:
a) Housing Society (HS) has already payed stamp duty and registration is done in the name of the housing society.
b)The HS is that of plots on which bungalows can be built and not that of flats.
c)7/12 document is also in the name of HS as well as all property tax bills and receipts.
d)Lease deed currently is executed between HS & the member of the HS (Current or new)
Question is:
1) Is stamp duty applicable again each time a plot is transffered from one member to the other?
2) If Yes, then will not the members keep paying stamp duty and registration for a single plot multiple times, even when the Lease deed is between the housing society and the member and when the absolute ownership is with the housing society.
3) MOST IMPORTANT ONE: Does the first member to whom the land plot was alloted after purchase of land, formation of housing society, payment of stamp duty and registration by the housing society also have to pay stamp duty and register the lease deed? (Because the land was purchased by the money of all the initial members). Will they not end up paying twice?
Thanks,
Tayib.
Tayib
(Querist) 19 January 2013
Looks like my query was too long.
Raj Kumar Makkad
(Expert) 19 January 2013
१. No.
2. NA
3. No question arises as the answer against query no. 1 is no.
As the lease is to be cancelled by the society against a particular lessee and has to make fresh lease deed with subsequent person so stamp duty thereon is required to be paid by that person.
Kishor Mehta
(Expert) 22 January 2013
Sir/s,
With due respect to both [1]Mr.Tayib & [2] Mr. Raj,
Whenever a transaction relating to transfer of property, of the value of more than Rs.100/- takes place, it has to be mandatorily registered and necessary stamp duty has to be paid, for the document to be valid in a Court of Law. The number of times the same property has been sold is not relevant.
Regards,
Kishor Mehta
Raj Kumar Makkad
(Expert) 22 January 2013
You are confirming to my earlier reply that the liability of stamp duty is to be borne in the given case irrespective of the fact that the same property has been sold many times.
Every time a new liability arises.
Tayib
(Querist) 30 January 2013
Thanks Kishore & Raj. Really appreciate the inputs.
I am summarising the points. Request to confirm.
What I understand is that stamp duty and registration is to be paid every time a liability arises on the said plot of a Co-Op Housing society.
1. However in my case since i am the first allotee to whom the plot was assigned i need not pay the stamp duty and registration as we (Me and other members) paid the initial capital for the purchase of land and formation of HS which got itself registered and HS initially paid Stamp duty and Registration on all the plots of the HS? I understand that the person to whom i will sell will need to pay the Stamp & Registration charges.
2. Also let know what type of agreement (Lease Deed, Transfer of Lease Hold rights etc) needs to be created between myself, HS & the buyer or will it be between 2 parties only.
Thanks,
Tayib.
Kishor Mehta
(Expert) 30 January 2013
Sir,
The Society can hold the property either on a free hold basis or a lease hold basis, and its members derive their rights from the Society.
A member of a co-operative housing Society needs two documents to prove his membership
[1] Conveyance of plot or flat as the case may be & [2] Share certificate of the Society having allotted the plot or the flat.
You have stated in your query that: I am the first owner and I am in possesion of Share Certificate & Allotment Letter for my plot which is vacant. I now want to sell the Plot however i did not get a lease deed done or paid any stampduty or registration charges till now.
Please inform whether you have a conveyance/lease document from the society transferring the freehold/leasehold rights of the plot in your favour.
Regards,
Kishor Mehta
Tayib
(Querist) 30 January 2013
No, i don't have conveyance/lease document from the society transferring the freehold/leasehold rights of the plot in my favour.
I ONLY have the Share Certificate & Allotment Letter dated 1999.
Also, the Society is registered as a Tenant Co-ownership HS. And the society is the absolute owner of the property and grants the Lessee, A Lease in respect to the said land/plot for a term of 999 years.
Kishor Mehta
(Expert) 31 January 2013
Sir,
In my opinion an assignment, of the lease rights of the plot, has to be taken from the Society.
You can then transfer/assign the lease rights of the plot.
Payment of Stamp Duty and Registration charges is applicable as per the laws.
Regards,
Kishor Mehta
Raj Kumar Makkad
(Expert) 31 January 2013
The subsequent buyer shall bear all transfer expenses including stamp duty and you need to register agreement to sale and then the share of society favouring you shall be changed in favour of the buyer.
Tayib
(Querist) 01 February 2013
I am confused and this exactly what is going on at the transactional level too.
Mr Kishore states that an assignment, of the lease rights of the plot, has to be taken from the Society and subsequently i need to pay stamp duty and register it before i can sell (transfer) the plot.
Mr Raj states that subsequent buyer (To whom i am selling) need to pay stamp duty & registration. All i need to do is to Register the agreement to sale without paying stamp duty and registration on the 1st allotment.
Need someone to bail me out :(
Having said that, i do appreciate all the participation as i know this is not easy one at all. Been a month since i am running around between Society, Registrar, Lawyers and bank.
Raj Kumar Makkad
(Expert) 01 February 2013
What ever I opined is based upon logic. You have already paid the stamp duty at the time when the land was purchased and you got its share. You need not to pay it again.
Tayib
(Querist) 02 February 2013
Clarification Mr Raj. I personally did not pay stamp duty when the land was purchased. The society post formation purchased the land and paid stamp duty and registration on the ENTIRE land of all plots post purchase.
Also, society NOW wants me to pay stamp duty and registration on the LEASE deed agreement between me & HS which i did not execute back then.
Raj Kumar Makkad
(Expert) 02 February 2013
In that event, you are liable to pay.
