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R. Balaji

Rs 100 per sq ft fixed for Chennai metropolitan area

Chennai June 13 Real estate developers in Tamil Nadu are now faced with a new levy, an infrastructure and basic amenities charge, that is estimated to cost them several hundred crore rupees. This is expected to hit every major developer countrywide with projects in Tamil Nadu.

Through an order dated June 1, 2007, the Director of Town and Country Planning has fixed for Chennai metropolitan area a charge of up to Rs 100 a sq ft depending on the type of building. The charges are to be collected from the date of the order.

Industry estimates show that over 40 million sq ft of residential space, commercial buildings and IT space are in the pipeline over next 15-18 months. This means the Chennai Metropolitan Development Authority (CMDA) is set to rake in around Rs 500 crore in the first year.

For other areas, the Director of Town and Country Planning has been given the power to fix the infrastructure and amenities charge up to a maximum indicated in the order.

According to the order, the objective of the infrastructure and basic amenities charge is to create a infrastructure and amenities fund for the sustainable development of urban areas, growth centres, provision of alternative and additional source for water supply, drainage and road connectivity.

The order says that the revenue from the charge would be credited to the infrastructure and amenities fund to be operated and maintained by the Director of Town and Country Planning. Till the fund is operational, for which separate orders are needed, the charges collected are to be deposited in a separate account.

More Stories on : Real Estate & Construction | Policy | Taxation | Tamil Nadu

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