Revision in lease rents: Maha in for windfall

The state is expecting "hundreds of crores of rupees" in revenue from the revised rent on lease properties given during the British Raj, state Chief Minister Prithviraj Chavan told reporters after the cabinet meeting here.

Giving an example, Chavan said with the decision to hike lease rent, Rs 17.71 rent (payable under old lease rates charged by the British Raj) will approximately go upto Rs 3.4 lakh (through ready reckoner) for the 570 sq km land while for the 3,070 sq meter land, the rent will go up from Rs 74.49 to Rs 33 lakh.

To a question on what would be the government's strategy if the decision is again challenged in court, Chavan said people cannot be stopped from moving the courts.

There are several properties on government land given on long lease by the British for period varying from 50 to 99 to 999 years, he said.

"Some have expired in the 1970s and 90s and amount of rent needs to be re-looked when they come for renewal. In Colaba area of South Mumbai, government gets a mere Rs 17.71 as rent for a 570 sq meter land while for a 3,070 sq meter land, the rent is only Rs 74.49 annually. This is not acceptable," the chief minister said.

The state government had decided to hike the rent through a cabinet decision but it was challenged in the court and the government had to go through litigation process. "In 2006, the cabinet withdrew its 1999 decision. But today we are revisiting that decision," he added.

Chavan said there are 1,282 properties on lease in Mumbai island city out of which the lease of 517 have expired, while in the suburbs there are 295 properties and the lease of 149 have expired.

"The hiked leased rent will be related to the ready reckoner price of the year when the lease is renewed," he said adding that the long lease will not extend to more than 30 years.

There will also be an option to convert the lease into occupancy class II ownership on payment of some percentage of the prevailing market rates. The option will be available to those whose lease has expired or will expire in the next ten years.