Circular No. 2, Fixation of Value for Undivided Share of Land in Residential Apartments, 2018
The Office of the Inspector General of Registration, Chennai, issued Circular No. 2 on 27 February 2018 to clarify how market value guideline rates must be applied to the undivided share of land in newly promoted residential flats and apartments. It directs registering officers to use an existing street or site rate where available, rather than fixing a separate higher rate solely because an apartment project has been formed.
What the circular governs
Circular No. 2, dated 27 February 2018, issued by the Office of the Inspector General of Registration, Chennai, deals with valuation of the undivided share of land, commonly called UDS, attached to proposed residential apartments and flats. It explains when registering officers must use an existing market value guideline rate and when a new house site rate may be fixed.
The clarification was issued because some Sub Registrars had sent unnecessary proposals for new values for apartment premises. Some District Registrars then fixed separate rates, leading to notices demanding deficit stamp duty and registration fees from flat purchasers.
Who is affected
The guidance affects purchasers and promoters of newly formed flats or apartments, particularly when documents transferring the related UDS are presented for registration. It also directs Deputy Inspectors General of Registration, District Registrars and Sub Registrars on the valuation method to follow.
Key valuation directions
- For a newly promoted flat or apartment on a street that already has a street value, the same street value must be applied. No new rate should be fixed specifically for the apartment premises.
- In semi urban or rural areas, if all relevant survey numbers have the same site rate, that rate must be used without fixing a new one.
- If the relevant survey numbers in a semi urban or rural area have different site rates, the highest site rate among those survey numbers must be used. The circular explains that each saleable UDS extends across all the survey numbers.
- If the relevant survey numbers carry agricultural rates, or if some have agricultural rates and others have site rates, a new site rate must be fixed by following the procedures in the cited earlier instructions.
Difference between apartments and layouts
The Office of the Inspector General of Registration distinguishes an apartment UDS from a plot in a newly formed layout. A new layout may require a new rate because land used for roads, pathways, parks and development is reflected in plot costs. For apartments, pathway areas are included in the UDS area, so the same basis for increasing the rate does not arise.
Market value guideline rates are intended for streets in urban areas and survey numbers in semi urban and rural areas, not for fixing a separate rate for an individual apartment property. The circular requires registration officers to follow these directions strictly.
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
Can a separate guideline rate be fixed just because a new apartment has been built on my street?
No. If the street already has a street value, Circular No. 2, dated 27 February 2018, requires that value to be used for the apartment premises without fixing a new rate.
Which rate applies if an apartment project covers survey numbers with different site rates?
In a semi urban or rural area, the highest site rate among the survey numbers covered by the project must be followed.
What happens if the apartment land is recorded at an agricultural rate?
If the survey numbers have agricultural rates, or a mixture of agricultural and site rates, a new site rate must be fixed using the procedures contained in the earlier instructions cited in the circular.
Why does the valuation approach differ for a new layout and an apartment project?
The circular says layout plot prices may reflect land used for roads, pathways, parks and development. In an apartment project, pathway areas are included in the UDS area, so that reason for increasing the land rate does not arise.
