The Greater Noida Authority has introduced a new policy mandating that homebuyers pay stamp duty upfront at the time of booking a flat.
This change, aimed at streamlining property transactions, is set to make an impact on both developers and buyers alike, with concerns over its practical implications already surfacing. As part of the new regulations, homebuyers must now sign a registered “agreement to sell” with the developer once 10% of the flat’s total cost has been paid. This agreement must be officially registered, marking a shift from the previous system where stamp duty was paid only at the time of possession. The stamp duty, which typically ranges from 6% to 7% of the property’s value, will now be due at the booking stage, significantly altering the traditional payment timeline.
The rule is intended to comply with Section 13 of the Real Estate (Regulation and Development) Act (RERA), 2016, and aims to ensure a more formal, legally binding commitment between buyers and developers early in the process. Under the new structure, when the builder hands over possession of the property, a “possession deed” will also be signed on ₹100 stamp paper. This system, according to officials, is designed to address concerns of delayed property registration, a common issue that has plagued Greater Noida’s real estate market for years. The Greater Noida Authority has justified the rule as a necessary step to protect homebuyers and the state’s interests. “Flats are often sold or transferred multiple times before the builder receives occupancy and completion certificates,” explained a senior official. “Many flats remain unregistered even after construction is completed. This new rule will help streamline the process and ensure buyers are legally protected.”
The policy also aims to boost revenue collection by ensuring that stamp duty is paid earlier in the transaction process, rather than at the time of possession. It is believed that this will reduce the occurrence of unregistered flats being sold multiple times, which often leads to legal complications and delays. Greater Noida’s policy mirrors similar regulations introduced by neighbouring authorities. In November of the previous year, a nearby authority required builders to register an agreement at the time of booking, and another authority in the region has adopted a similar approach. These changes follow directives from the state government, which has emphasised the strict enforcement of RERA rules across the region.
While the new rule has been welcomed by some as a step towards greater transparency, it has raised significant concerns among builders and prospective buyers. Real estate developers argue that the rule could lead to legal and financial complications. One developer highlighted the issue of refunds in the case of cancelled bookings. “What happens if a buyer cancels? There is no clear process for refunding the stamp duty,” they pointed out. They also voiced concerns about the logistical challenges of paying stamp duty at the initial stage, especially given that about 20-25% of bookings are often cancelled due to various reasons, including financial issues or transfers. Further complicating matters, some builders have expressed fears that early registration might lead to disputes if a buyer defaults on payments after registration. “Once a property is registered, if the buyer stops paying, the situation becomes much harder to resolve,” warned a prominent developer.
Homebuyers have also expressed dissatisfaction with the suddenness of the rule, especially since they were not consulted prior to its implementation. Many believe that paying full stamp duty before receiving possession places an undue financial burden on them, especially given the uncertainties surrounding construction timelines. One buyer stated, “It’s unfair to ask for the full stamp duty when there is no guarantee of when possession will occur.” As the policy takes effect, it remains to be seen whether it will achieve its objectives of streamlining registration and protecting both buyers and the state’s financial interests. With growing concerns from both the real estate industry and the homebuyer community, the Greater Noida Authority may need to reconsider certain aspects of the rule or introduce amendments to address the logistical and financial challenges it poses.
Also Read:Â https://urbanacres.in/elphinstone-bridge-residents-to-stay-in-redeveloped-homes/
