The Supreme Court's decision invalidating standards to determine the capital value of land will result in Rs 1,000 crore loss in property tax revenue every year for the BMC, reports from Mid-Day stated.
In November 2022, the apex court upheld an April 2019 Bombay High Court order invalidating three standards to determine the ‘capital value’ of land where construction was yet to begin.
The apex court's decision has proven to be a setback for the Brihanmumbai Municipal Corporation (BMC). However, it provides great relief to real-estate developers in Mumbai, where construction cost is significantly higher when compared to other cities.
For the year 2022-23, the BMC's major sources of revenue were compensation in lieu of octroi—Rs 11,429 crore, followed by property tax collection—Rs 7,000 crore, followed by income from the Development Plan (DP) department— Rs 3,950 crore.
A senior civic official told Mid-Day that the civic body will file a review petition in the apex court as the body may otherwise face a major loss in income.
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