G.O. (Ms.) No.131, Reduction in Stamp Duty for First Sale of Apartments, 2023
The Commercial Taxes and Registration (J1) Department issued Government Order G.O. (Ms.) No.131, dated 1 December 2023, introducing composite valuation and revised charges for deeds involving the first sale of newly developed flats and apartments. It replaces the practice of separately registering the undivided share of land and the building, and the concession does not apply to second sales.
What the government order changes
Government Order G.O. (Ms.) No.131 of the Commercial Taxes and Registration (J1) Department, dated 1 December 2023, changes how the first sale of a newly developed flat or apartment is valued and registered. The earlier practice involved registering a sale deed for the undivided share of land and a separate construction agreement for the proposed building.
Under the new model, the undivided share of land and the building are combined in one sale deed. Stamp duty and registration fee must be collected on the composite value of the property, calculated using the super built-up area, or on the value stated in the document, whichever is higher.
Who is affected
The new method is relevant to:
- Buyers purchasing a newly developed flat or apartment from a promoter or landowner.
- Builders, developers, promoters and landowners making first sales.
- Registration officers who value and register these deeds.
- The Central Valuation Committee, which must develop the method and guidelines for fixing composite values according to existing market value.
The table in the government order also refers to apartments, flats, villas, row houses and villaments in real estate projects. However, the operative concession is expressly stated to apply only to flats and apartments registered with the undivided share of land on first sale.
Charges under the operative direction
The final direction provides the following total charges based on the composite value or document value, whichever is higher:
- Below Rs.50 lakhs: stamp duty 2.86%, transfer duty 1.144% and registration fee 2%, totalling 6%.
- Rs.50 lakhs to Rs.3 crore: stamp duty 3.575%, transfer duty 1.43% and registration fee 2%, totalling 7%.
- Above Rs.3 crore: stamp duty 5%, transfer duty 2% and registration fee 2%, totalling 9%.
An earlier proposal reproduced in the document uses Rs.4 crore as a threshold. The final operative direction uses Rs.3 crore.
Important limitation
The concession applies only when a flat or apartment and its undivided share of land are registered together as a first sale. It does not apply to a second sale of a flat or apartment.
This summary is generated from the source document to help you find what is relevant. The PDF above is authoritative. For advice on your own property, use LandLens One or speak to a qualified professional.
Common questions
Does the concession apply when I buy a resale flat?
No. Government Order G.O. (Ms.) No.131 expressly states that the concession does not apply to the second sale of flats or apartments.
Will the land share and building still require separate documents?
No. For the covered first sale, the practice of separately registering the undivided share of land and the building is discontinued.
How will the value of a new flat be calculated for registration?
Charges are based on the composite value of the undivided share of land and the building calculated using the super built-up area, or the value stated in the document, whichever is higher.
What total charge applies to a first-sale flat valued at Rs.50 lakhs to Rs.3 crore?
The operative table states a total of 7%, consisting of 3.575% stamp duty, 1.43% transfer duty and 2% registration fee.
