Published: Thursday, Oct 20, 2011, 17:42 IST
Place: Mumbai | Agency: PTI
Maharashtra Chief Minister Prithviraj Chavan today said State Government has decided to offer an additional 0.33 FSI (floor space index) to Real Estate Developers in the suburbs for a premium.
"We have decided to provide additional 0.33 FSI to the Developers in the suburbs on payment of a premium. This decision will not only enable the state to generate additional revenue by granting extra FSI, but will also help the Developers to provide better housing stock," Chavan told reporters on the sidelines of an international investor summit here.
Currently, the Government has allowed a global FSI of 1 in the suburbs while in the island city it is 1.33.The developers are therefore buying Transfer of Development Rights (TDRs) from the market to increase the FSI to as high as 2.
If the new FSI norms are implemented then the suburbs will also get the FSI of 1.33 which will be on par with the island city.
Floor Space Index (FSI) is the ratio between the built up area allowed and plot area available.
"It has been observed that Developers are buying TDRs from the market to increase the FSI levels and they are also reaping the benefits of the same. But now we have decided to offer additional FSI that will enable us to generate revenue by charging this levy and use it for augmenting infrastructure in the state," he said.
Asserting that the move will also ensure reduction in property prices as more housing units will be available, Chavan said, "the Industry has been demanding extra FSI saying buying them from the market is expensive. But offering additional FSI will not only enable developers to create extra housing stock but the buyers will also benefit from lower property cost."
Saying that entire legislative process of allowing additional FSI is already in place and the initial notification being made, Chavan observed the decision had been delayed due to certain concerns raised on whether the hike in FSI would put a strain on the existing infrastructure.
A 2008 petition against the move had raised the issue of infrastructural inadequacy and change of character of the development plan if the State granted additional FSI, after the state had amended Section 32 of the Development Control (DC) Regulations to grant additional 0.33 FSI in the Mumbai suburbs on payment of a premium in April 2008.
But the Bombay High Court struck down the notification and restricted granting of Commencement Certificate (CC) to applications received only after May 23, 2008.
The Government then issued an Ordinance on September 21, 2010, allowing the BMC to charge premium and legally approve all proposals given the go-ahead earlier by collecting a premium under the new rule.
The BrihanMumbai Municipal Commissioner had made a presentation to the state that granting additional FSI will not pose extra burden on the infrastructure.
In a letter to the Urban Development Department, BMC Commissioner Subodh Kumar had said, "by not allowing this FSI, the Government would only firm up the TDR rates, which will put smaller projects that had purchased 0.33 FSI in the wake of lower TDR rates, at a risk. In view of these facts, the Government should immediately issue more clarity on this issue," he had said.
"The entire issue was thoroughly studied and at the end we have decided to go ahead with the decision," Chavan added.
SOURCE COURTSEY: DNA