Noida: Property Buyers Object to Stamp Duty on Sale Agreement

NOIDA: Property buyers are opposing the Uttar Pradesh government’s decision to levy stamp duty on sale and purchase agreements. This happened because the government obliges buyers to pay 6% of the buyer-developer’s value in the form of stamp duty at the stage of signing the contract, even before the apartment or store is ready for use and the register transferring ownership is completed. .

Buyers argue the move is unfair and should be delayed instead of requiring property buyers to pay stamp duty.

“We have objected to the new decision of the state government and have written a letter to the Noida and Greater Noida authorities, including the state government. Paying stamp duty at the time of signing the sale agreement only benefits the government, which wants to generate revenue and places a financial burden on the buyer even before the apartment or shop is ready for use by the consumer,” said Anu Khan. , President of the Noida Extension Apartment Owners and Members Association, who are planning to protest against the move, adding, “Why should we pay stamp duty in advance even though the wait for the apartment or other type of property that a person intends to buy may be endless.”

Homebuyers say there are thousands of cases where they have bought a property from a developer under a registered deed and have also paid stamp duty but are yet to receive ownership of the flat.

Under the old norms, buyers sign an unregistered apartment sale and purchase agreement with the developer without paying stamp duty for the total value of the developer-buyer agreement. They pay 5% of the total property value as stamp duty when the apartment is ready to move in and registration is completed.

In October, the Industrial Development Authority of Noida, Greater Noida and Yamuna Expressways made it mandatory for property buyers in new real estate projects to pay 5% of the total contract value as stamp duty and register the sale agreement signed between the developer and the builder. The buyer describes the conditions in detail for both parties.

Previously, the buyer did not have to pay stamp duty and was not required to register it with a government agency.

Advocate-legal expert Sunil Kumar Mishra said the state government’s move is more focused on revenue recovery rather than protecting the rights of home buyers.

Manoj Kumar Singh, chief secretary, Uttar Pradesh, said, “We have introduced this practice to protect the rights of home buyers as there have been cases where realtors have found one flat being sold to multiple buyers with an unregistered sale agreement. We don’t understand why buyers are objecting to this move.”

Vandana Tripathi, additional general manager, Noida Authority, said, “If any buyer buys a property in a new project without paying stamp duty of 5-6% of the value of the developer-buyer agreement, then we will not recognize it. We will only confirm the sale of new projects if the buyer pays stamp duty.”

The Confederation of Real Estate Developers’ Associations of India (CREDAI), a group of realtors, said the move would undermine the positive sentiment in the real estate market. “The state government should stop the implementation of this new directive as it will not benefit any party in the real estate sector,” said Dinesh Gupta, secretary, CREDAI.