Circular · Inspector General of Registration · 04.11.2015
Older flats are valued lower for stamp duty: the depreciation table
The Inspector General of Registration’s circular of 4 November 2015 sets out how the age of a building reduces the ready-reckoner value used for stamp duty on resale of flats, offices and shops.
Key points
- Only the construction component of the ready-reckoner rate is depreciated, not the land component.
- Value after depreciation = open-land rate + (built-up rate − open-land rate) × the percentage for the building’s age.
- For RCC buildings the percentage falls from 100% (up to 2 years) to 30% (over 60 years); for semi-permanent structures, to 15%.
- The age is taken from the occupancy certificate or, if none is available, from other proof such as municipal tax, electricity or telephone bills or a society certificate.
Why the circular was issued
The earlier guideline allowed a depreciation deduction from the whole rate for residential, office and commercial property. But the ready-reckoner rate for a building includes both land and construction, and depreciation should apply only to construction. The old method also led to buildings being shown as younger than they were, so that parties did not get the benefit of the building’s real age. The circular cancels the earlier guideline and replaces it.
How the value is worked out
- A = the ready-reckoner rate for the residential, office, commercial or shop property.
- B = the ready-reckoner rate for open land.
- C = A − B (the construction component).
- D = the percentage for the building’s age, from the table below.
- Value to be taken = B + (C × D).
| Age of building | RCC / other pucca | Semi-pucca / kutcha |
|---|---|---|
| 0–2 years | 100% | 100% |
| 2–5 years | 95% | 95% |
| 5–10 years | 90% | 85% |
| 10–20 years | 80% | 75% |
| 20–30 years | 70% | 60% |
| 30–40 years | 60% | 45% |
| 40–50 years | 50% | 30% |
| 50–60 years | 40% | 20% |
| Over 60 years | 30% | 15% |
Notes in the circular
- The age is to be taken from the occupancy certificate. If that is not available, other evidence may be used — the municipal tax receipt or occupancy-certificate application, or proof such as electricity or telephone bills or the society’s certificate. If the building has been redeveloped, the age of the new building must be verified.
- Where the ready reckoner gives no separate rate for the type of property, valuation follows guideline 7.
- For large plots of land, the land value is worked out under guideline 17.
What it means in practice
When a flat in an older society building is sold or transferred, the stamp duty valuation should apply this depreciation. Keeping the building’s occupancy certificate, or other proof of its age, ready with the society’s records helps members get the correct valuation.
Two-page circular in Marathi, issued by the Department of Registration and Stamps. Check the current year’s ready-reckoner guidelines, which may have revised these rules. This page summarises the document for general information; it is not a translation and not legal advice. Read the document itself for its exact terms, and check whether it has since been amended or superseded.
Have a question about your society?
Write to the office with a brief description of the matter. Meetings are by prior appointment.