TV
I contacted a retired PSU Bank official, now 76 years old, living in his duplex bungalow in Palas Palli, a residential colony developed by Bhubaneswar Development Authority(BDA) in late 80s and asked if he had had lease document. He said his lawyer has been assuring that he would be able to get it sometime soon. I then contacted a resident of Kalinga Vihar, a township developed by the BDA on the outskirts of the main city. The gentleman, now 82, was a Chief Engineer of the state government; he owns a HIG Bungalow. I asked him the same question. He too has not. His son-in-law, a senior executive in a PSU oil company who works in Mumbai also has a similar property in Kalinga Vihar. I asked him the same question. He too has not got his lease document. I reached out to another resident.
He worked in international organisations as a consultant. He too lived in Kalinga Vihar. He had a long poignant story to tell. We spoke for some time. They ran from pillar to post as a group effort. The premium looked a huge amount and they wanted to know the reason. It was a learning lesson. The BDA had not paid the premium to the state government and the state government has now imposed penal interest of a couple of hundred crores on BDA which has to be recovered from the allottees. BDA made efforts to get the interest waived and mercifully, succeeded.
Now BDA asked the allottees to pay a processing fee of sixty thousand rupees. The group found the amount an avoidable irritant, engaged a lawyer and challenged the order in the High Court. The process was slow and dragged on for a couple of years with a couple of hearings when corona pandemic intervened. The good lawyer advised the clients to be pragmatic, forget litigation and pay the amount. They did. Now he wants to convert the leasehold arrangement to freehold. The process is no cakewalk. He filled up the form, he was advised to enclose eleven documents.
He took pains, collected them and has submitted the papers. Again, a processing fee of forty thousand needs to be paid.
“Why are you keen to covert your lease to freehold?” I asked. He was candid. He would love not to have any connection with the BDA. In case the relationship continued with BDA, he would have to seek their permission to sell his property. That would involve a lot of running about, palm greasing, payment of usurious fees and sharing a hefty portion of the sale amount with the BDA. I was convinced that there was no love lost between him and the BDA—a public institution supposed to serve the people. Unfortunately, the adversarial relation between a citizen and the state or parastatal was getting more and more pronounced. “Have you ever had seen a friend in government?” I asked. He said, “Only once. That was a lady who was engaged in updating electoral roll. She volunteered to help me and got my name registered as a voter.”
The ire of another house owner, a former senior IAS official, is for another reason. He is against payment of 3% of the present benchmark value as conversion fee. His stand is he had paid the full premium in 1989-90 at the prevailing rate and the conversion fee should be relatable to that rate. The delay in making conversion facility available to house owners who bought the property from BDA was the fault of the government and the house owner should not be penalised for it. He also is against the hefty processing fee of forty thousand rupees being charged by BDA to process the application for conversion.
A few disturbing pictures emerge from this analysis. Government housing agencies like the BDA and the Housing Board sometimes got government land for developmentwithout payment of the prescribed premium and without executing the lease with government and therefore lacked legal authority to sell the developed plot or house on it to the allottees. For decades this situation persists and houseowners are not able to execute lease deed. Thousands of allottees have been occupying their houses without lease document. The other important issue is the high processing fee being charged by the housing agencies. The third issue is about conversion fee being related to the present benchmark value.
Two reliefs could be considered straight away by a people-friendly government. The processing fee needs to be drastically reduced and fixed at Rs 5000 through a government directive. Government introduced the facility of conversion of leasehold to freehold only in 1998 for residential plots allotted by the General Administration Department to allottees in Bhubaneswar. This facility was extended to BDA and Housing Board allocations in 2020 though it was notified in 2023. In the interest of equity, those allottees who had completed lease agreement by paying the full premium much earlier, should be permitted to pay conversion fee at the rate of 3% of the value of land as assessed by the GA Department in 1998 when the principle of conversion was introduced in the state. For others who come for conversion later, should be allowed to pay on the basis of benchmark value as on 1.1 24. In other words, benchmark price link with conversion should stand frozen instead of being open ended.
For GA Department allottees, the present arrangement of linking conversion fee to an open-ended benchmark valuation should be done away with and the future conversion fee should be linked to benchmark price as on 1.1 24. GA Department should rationalise the grades of conversion fee and limit it to two grades at 3% and 7% of the benchmark rate frozen as on 1.1 24.
(DISCLAIMER: This is an opinion piece. The views expressed are the author’s own and have nothing to do with OTV’s charter or views. OTV does not assume any responsibility or liability for the same.)
