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Ghaziabad development body hikes fee for construction beyond layout plan from April 1
ET Realty  |  May 1, 2019

Abhijay Jha Ghaziabad

The Ghaziabad Development Authority (GDA) has increased the compounding fee for all residential, official and commercial constructions from this fiscal.


The Ghaziabad Development Authority (GDA) has increased the compounding fee for all residential, official and commercial constructions from this fiscal. Officials in the GDA said the fee has been hiked on the basis of cost index and the new rates came into force from April 1.


Compounding fee refers to the amount a development authority charges for extra construction that is not sanctioned in the original plan. “The fee is calculated on the basis of cost index and it is revised every year. The new rates come into effect from the beginning of a financial year,” said Ishtiaq Ahmed, the chief architect and town planner at the GDA. “The new rates for this financial year came into effect from April 1.”


From this fiscal, the compounding fee under the residential category, for an area between 100sqm and 1,999sqm, has been increased by Re 1/sqm. “For up to 100sqm, the fee was Rs 20/sqm till the last fiscal. It has now been increased to Rs 21/sqm,” said Ahmed. “For areas in the 300-499 sqm and 500-1,999 sqm categories, the fee has been increased from Rs 29/sqm to Rs 30/sqm and Rs 39/sqm to Rs 40/sqm, respectively,” Ahmed added.


For an area of 2,000 sqm and above, the compounding fee has been increased from Rs 47/sqm to Rs 48.50/sqm, he said.


By applying the rates for residential spaces as the base, the compounding fee under commercial and official categories have also been increased, with effect from April 1. “Under the commercial and office heads, the rates have been increased by two times and 1.5 times for the same area slabs, respectively,” said Ahmed.


Apart from area, compounding fee is also charged on a unit basis. Explaining it, Ahmed said the number of kitchens in a flat determines a unit. “If for example, in a 1BHK flat, there is one kitchen, it will be treated as a single unit and if, in a same size flat, there are two kitchens, it will be treated as two units. For an increase of one unit, one had to pay Rs 92,284 in the last fiscal. Now, the compounding fee is Rs 94,997,” Ahmed added.


Compounding fee is one of the major sources of revenue for the GDA. Officials said that according to state government rules, a construction that is 10% of the sanctioned area can be regularised after paying the fee. But anything above that is considered illegal.


But Alok Kumar, president, Federation of Apartment Owners Association, said compounding fee is not serving its purpose. “As per the rule, it is permissible only on extra construction of up to 10% of the sanctioned area. But there is no effective mechanism to verify the extra construction. It totally depends on physical verification by junior engineers,” Kumar said. “This leaves ample scope for manipulation and also, sometimes, legalises illegal construction,” he added.