Mumbai: BMC blindly increases property tax by 15-20 per cent

After issuing property tax bills almost eight months late the civic body delivered another blow to citizens with an unannounced increase of 1520 per cent in their bill amount as compared to last year The bills were issued with a footnote stating that they are being issued on a securityadhoc basis until a final policy decision regarding property tax is madeThe move drew criticism from former corporator Asif Zakaria who wrote to the civic commissioner alleging that the BMC has been collecting extra tax from citizensmdashfrom 2010 to 2023mdashand now instead of a refund more of the taxpayersrsquo money is being grabbedEvery year the Brihanmumbai Municipal Corporation BMC starts issuing the property tax bill in April This year despite repeated requests from citizens the BMC delayed the procedure and started issuing bills in the first week of December Many citizens havenrsquot received a physical copy of the bill but most of them can access it online ldquoWe inquired even last month Now we can see our bill online which is more than 15 per cent than last year I went personally to the ward office to pay the bill by cheque but the system was down and the employee suggested that I should wait for a few more days as there is an ambiguity over the amount of the property taxrdquo said a resident of DadarThis year the BMC started issuing property tax bills in December Representation picAs mandated the BMC can increase the tax every five years but the proposal to hike the taxes wasnrsquot approved in the last three years since 2020 Property tax is the second largest source of revenue for the BMC but the corporation couldnrsquot manage to collect it as per the target for the last seven years Now the move to increase the tax for security reasons has raised the eyebrows of manyAsif Zakariamdasha former corporator from Bandramdashwrote a letter to BMC Commissioner and Administrator Iqbal Singh Chahal regarding the increased property tax bill issued for 20232024 on Friday He told midday that although Property Tax is the second largest source of revenue for the corporation it is still in dire need of revenue to continue with various development and infra works ldquoBut this doesnt justify the corporation issuing securityad hoc bills with an increased amount thereby putting additional burden on citizens I request the BMC to reconsider the issuance of the new bill immediatelyrdquo Zakaria saidChahal said the letter will be examined on its merits by the property tax department ldquoThe property tax bills were uploaded just now and physical copies are not handed out yet If there is any clerical error we will rectify it and issue new billsrdquo he said adding that he doesnrsquot know how bills are being issued with increased amounts as he didnrsquot receive the file for sanctionWhat the letter statesThe Capital Valuation Rules 2010 implemented in March 2012 were defective faulty and not in consonance with the amendment act Eventually the High Court by its order dated April 24 2019 had set aside certain rules particularly Rule Nos 20 21 and 22 Further the Supreme Court by its order dated November 7 2022 had upheld the decision of the HC and the corporation has been directed to reframe the said rulesNo new assessment process was commissioned wef 2012 onwards The corporation had not informed the taxpayers how much refund they would get and how the same would be adjusted against future taxes The corporation has unlawfully withheld taxpayersrsquo money from them This highlights that the corporation has disregarded the court orderIt is almost a year since the court order was issued but the BMC did not frame new rulesmdashnamely 20 21 and 22mdashwhich were set aside by the HC order2020Year property tax was to be hikedAs per court orders these changes were to be made Property tax for the years 2010 to 2012 was to be taxed as per the Rateable Value System Assessment of capital valuation on the basis of carpet area instead of builtup area Further the area under the Stamp Duty Ready Reckoner is a BUA rate which has a component of 12 factor Openvacant land to be assessed based on FSI 1 and not on potential FSI The corporation was charging tax as per the potential of the plot or approved plan with 25 FSI4 FSI as per the project As regards to the old buildings assessmentarriving on the capital value the depreciation factor was adopted from rules and not from the Ready Reckoner As building rates are taken from the Ready Reckoner which has been fixed considering guidelines the depreciation should be based on this factor All the above would need a major reworking of the Capital Value System and a refund would be needed to be given to the citizens who had paid the full amount along with interest as per section 140A 2 as in a majority of cases the BMC has wrongly forced the citizens into paying the full amounts