The gradual easing of the lockdown has led to the cash-strapped Maharashtra government collecting over Rs 791 crore as revenue from the Department of Registration and Stamps in the first two months of this financial year. However, a market slump and the ongoing restrictions on movement have resulted in its collections being much lower than the approximate Rs 4,900 crore earned for the same period last year.
In April, when the lockdown, enforced due to the COVID-19 pandemic, was being implemented strictly, only 0.01 lakh documents were registered. However, the number has gradually risen to 0.43 lakh in May. This is much lower than 2.28 lakh and 2.66 lakh, respectively, for the same period in 2019-20.
The department is the second highest contributor to the state's kitty after the Goods and Services Tax (GST). It has generated a revenue of Rs 791.6 crore in the present fiscal (Rs 275 crore in April and Rs 516.6 crore in May) compared to a much higher Rs 4,948.5 crore for the same period in 2019-20 (Rs 2,161 crore in April and Rs 2,787.5 crore in May). The state had set a target of Rs 4,833.33 crore for the first two months of this year.
Speaking to the Free Press Journal, Omprakash Deshmukh, inspector general of registration and controller of stamps, said while they had 517 sub-registrar offices (SRO), around 41 were located in containment zones, and were hence shut.
“We have been taking precautions like the usage of thermal scanners, sanitisers and masks. However, the ongoing restrictions have led to a 50 per cent fall in the volume of transactions, from a daily average of 60 transactions per SRO,” he added.
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Deshmukh explained that it was difficult for people from other states and even from cities in Maharashtra to travel in order to register their transactions. He, however, added that this should not be interpreted as a loss of revenue, but a deferment of the earnings, as these deals on immovable property would be registered once the restrictions were lifted.
In 2019-20, a total of 28.2 lakh documents were registered, generating a revenue of Rs 28,661.7 crore. The department has a target of Rs 29,000 crore for this financial year. However, officials admit that this may be tough to meet considering the slump in the market.
A report published by Liases Foras, a non-broking real estate research firm, states that during the financial year 2019-20, a total of 18,213 units were sold. While three years ago in 2017-18, total 20,509 units were sold in Mumbai. The impact on the real estate industry due to the lockdown is also adversely affecting the government's stamp duty revenue collection. In Maharashtra, between 2017-18 and 2019-20, there has been a 37.19 per cent fall in stamp duty, registration and GST earnings. In 2017-18, the state government earned Rs 19,385 crore from primary and secondary real estate markets, which sharply fell to Rs 12,174 crore for the year ending on March 31, 2020
“The previous financial year was believed to be the turnaround year for the real estate sector and the Indian economy. The lockdown added to the woes of the sector, which started from March 22, and continues with an uncertain deadline. This lockdown has further pushed the entire industry behind by a minimum of 5 years,” said Ajay Ashar, spokesperson of Credai MCHI MMR Action Committee. He further added that if the lockdown continues for another month, the sector will not be able to recover from the shock for another 2-3 years.
