• Joint Development Agreement related issues

I plan to get my house reconstructed via JDA where the Builder will retain 1 floor+2 parking slots and I will retain 3 floors+4 parking slots out of 4 floors built on stilts in Delhi. Answers needed to questions below: 1.Registration of JDA: Builder says not needed as it is a costly step. Comments pl? How is the stamp duty value calculated? Is it my share of 3 floors based on circle rate of construction or..? + 25% of land value based on circle rate of land or../ + anything else? 2.Lawyers at the Sub Registrar's office have said that JDA is not being registered as value  etc is not clear yet. Pl clarify if correct. 3. At which stage and on what value does any GST become payable by me? 4. Post construction, what paperwork is needed to legalise my portion and the builder's client's portion who buys one floor+2 parking slots and pays him? If any further stamp duty is to be paid, what will be the basis. Thank you
Asked 4 years ago in Property Law
Religion: Hindu

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11 Answers

You need to execute registered development agreement with him along with all the terms of allotment in the same. No other document is needed. If it's tentative in beginning you can start with mou

Prashant Nayak
Advocate, Mumbai
32934 Answers
209 Consultations

1 &2. JDA is always better to have been registered to avoid future complications, if any.  The value of the land to be developed is taking into account while assessing the stamp duty. 

2. GST is to be paid while selling individual flats after being constructed. 

3. After a registered JDA nothing more is to be done apart from CC and OC.

 

Devajyoti Barman
Advocate, Kolkata
23351 Answers
523 Consultations

Stamp duty is state subject and varies from state to state 

 

2) advisable to register JDA

 

3) suplementary sharing agreement has to be signed with builder 

Ajay Sethi
Advocate, Mumbai
97605 Answers
7901 Consultations

Get it notorised. 

Registrstion permitted of JDA. Dont mention amount but only share in property. Maximum 1500rs registration fees.

No GST as no transaction will done but only development agreemnt.

You are owner so no document will register, you have to give POA to builder to sell his share.

Ni stamp duty payable by you but builder will pay when he will sell his share.


Dont get confused, execute agreemnt on 500rs stamp and registered it. 1500rs fees. No other document require to register.

 

Yogendra Singh Rajawat
Advocate, Jaipur
23012 Answers
31 Consultations

- A Collaboration Agreement/JDA is an arrangement between an owner of the land and a builder where the land owner contributes the land and the developer undertakes the responsibility of obtaining approvals, property development, launching and marketing the project with the help of his financial resources. 

- As per law, the builder is not the transferee or buyer of the flats as per the Transfer of Property Act, 1882 under the Collaboration Agreement.

- The ownership lies with the owner of the land, but the landowner grants the builder along with development rights, a license to enter the land for the purpose of development.

- The license/authority to enter the land is typically given by way of a Power of attorney issued in favor of the Builder, and this General power of attorney should be registered with the Registrar in order to be legally binding on both parties.

- Hence, the transfer of the land on which construction will be carried by the Builder, is mandatory. 

- On completion of the construction by the builder, the occupancy right is granted by the competent authority to the owner, and the owner will himself execute the sale deed in favour of the buyers.

- Further, in case of breach of the terms of the Collaboration agreement, the land owner will have the right to revoke the power of attorney.

- Further GST is applicable only after construction and selling the flats .

Mohammed Shahzad
Advocate, Delhi
14773 Answers
225 Consultations

JDA is compulsorily Registrable u/s 17(1)(b) of Registration Act, 1908 since it creates development rights in respect of immovable property 

Stamp duty is calculated as applicable on a sale or conveyance of the subject property 

Lawyers at sub registrar office and builder are both incorrect

When you sell your portion of flats in the new building you will have to collect GST from buyer and deposit that with government treasury

However if sale  by you of your portion is after completion certificate or occupancy certificate is issued by Municipal Corporation then no gst is liable to be collected from your buyers

Post construction the builder has to register deed of allotment with you for your share of flats. If stamp duty is duly paid on the JDA then only nominal duty will be payable on the deed of allotment. However this varies from state to state. So please check Delhi Stamp Act

Yusuf Rampurawala
Advocate, Mumbai
7765 Answers
79 Consultations

1. The JDA can be executed by an unregistered document also, however if you have to enforce the conditions in future through court then you may have to possess a registered document so that it is legally valid to file a suit against the builder in case of dispute ion future.

The applicable stamp duty has to be paid for registering the JDA deed.

2. Once the construction of the flat is constructed and occupancy right is granted by the competent authority to the owner, the owner will himself execute the sale deed in favour of the flat buyers. - Hence, automatically , the landowner will receive the formal title of ownership from the builder.

Based on the registered supplementary agreement, the land owners get their title to the flats And the builder needs to pay the stamp duty for the flats allocated to the builder(so technically the land owner does not pay any stamp duty or registration charges for their share of flats).

3. when the Landowner receives a constructed property from the Developer in exchange for providing land, the Landowner would become liable for payment of GST. The GST rate applicable on such a transaction would be 18%.

4. When a developer enters into a development agreement with a Landowner, GST would become payable by the Landowner when the developer transfers possession or the rights in the constructed complex, building or civil structure, to the Landowner by executing  a conveyance deed or allotment letter.

 

 

T Kalaiselvan
Advocate, Vellore
87806 Answers
2365 Consultations

1. &2. The  registration of JDA  will not take much amount but it can be skipped. Registration of JDA is advisable in your interest. Here minimum registration fee will be charged since value is yet to be determined.

 

3. You shall have to pay GST after monetary transaction takes place i.e. when the sale takes place.

 

4. .In the JDA itself the allotment of developed flats shall have to be clearly made. Thereafter you can mutate your allotted flats in your name.

Krishna Kishore Ganguly
Advocate, Kolkata
27533 Answers
726 Consultations

1. Its very very important to register the agreement. Unregistered agreement is invalid. 

2. JDA Is not registered on basis of value of land. It will be a general registration. 

3. GST will be paid as per the terms you agree in agreement, like for purchase of building materials of your share.

4. Registered sale deeds.

 

Rahul Jatain
Advocate, Rohtak
5365 Answers
4 Consultations

1. It may be a costly step but registered contract are legally more enforceable then unregistered contracts.

2. GST will be applicable to the cost you are paying to builder as construction charges.

3. You need to register the sales deed for the flat and parking to be given to builder or his client As undivided share in land.

Mohit Kapoor
Advocate, Rohtak
10687 Answers
7 Consultations

The validity and authenticity of a document can only be proved if it is registered in the office of the sub-registrar. 

Mohammed Mujeeb
Advocate, Hyderabad
19326 Answers
32 Consultations

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