If you are buying or selling property in India, did you know there is an official way to find out its minimum value and ready reckoner rates are those government defined rates.
There is a government defined rate known as Annual Schedule of Rates (ASR) which ensures that property sellers don’t cheat buyers by charging an unreasonable price. In fact, ASR (also called as ready reckoner rate or RRR in Maharashtra, circle rate in Delhi) published by government also becomes the floor price and is also used in the calculation of stamp duty. So higher the reckoner rate, the property rate and applicable taxes also goes up, directly affecting the affordability of homes in India.
Ready Reckoner Rates are determined by Stamps and Registration Department of the state of Maharashtra to help individuals to find the official rates of properties in a particular area and is based on various market parameters. These property rates are reviewed time to time and the govt. tries to keep them close to the prevailing market rate.
ASR only provides the benchmark rates in real estate market. But actual rates vary from property to property depending on lot of parameters like builder’s reputation, quality, location characteristics, etc.
Property buyer and seller can be questioned by the authorities for details. ASR or ready reckoner rate becomes the floor price and neither property owners or builders sell below this price nor do buyers pay less. And if a property is sold below this reference rate, then as per Income Tax Act of India the difference between the selling and ready reckoner price is considered a black money transaction.
Mr. Kumar wants to buy a residential property in Mumbai at Rs 2 crore from a developer but the ready reckoner price comes to Rs 2.5 crore. The difference of Rs 50 lakh will be added to the income of the buyer and the developer’s business income.
Authorities may not question the buyer or seller, but the stamp duty of the property gets increased. Stamp duty is levied on the ready reckoner rate or the agreement price, whichever is higher.
Related Post:What is stamp duty?
Thank you for visiting our website. We are currently updating our website towards compliance of the newly introduced housing law for the State of Maharashtra i.e. the Real Estate (Regulation and Development) Act, 2016 and the rules and regulations notified thereunder.
In the interim, no information, images or material which is currently available / displayed on the website relating to builder projects shall be deemed to constitute any advertisement, invitation, solicitation, offer or sale of any such builders product offerings. Please contact us for any enquiry.CONTACT US