LG’s Approval Needed For Fixing Circle Rates, SC To Delhi Govt

The Supreme Court (SC) on February 14 said that although the Delhi government had the powers to fix land circle rates in the national capital, it could not implement such measures without receiving an approval from the Lieutenant Governor (LG). At the same time, the top court also remarked that it did not expect the LG and the council of ministers to differ on such issues often. In case there was a difference of opinion between the state government and the LG, the matter could be referred to the President for decision, the SC stated.

Circle rates are government-fixed minimum rates at which a property could be sold in a particular area. Subject to periodic revision, these rates, also known as ready reckoner rates, government rates and collector rates, vary from state to state and locality to locality. It is this rate on the basis of which buyers have to pay stamp duty on their real estate transactions. A hike in rates would mean properties becoming costlier.

The apex court ruled that circle rates were fixed for the purpose of payment of stamp duty and did not pertain to right over land.

"Circle rates are fixed for the purpose of payment of stamp duty. Therefore, they do not pertain to land namely rights in or over land, land tenures etc., or transfer of alienation of agricultural land etc. Stamp duty is not a duty on instrument but it is in reality a duty on transfer of property," the Bench said.

The circle rates in the national capital are revised under the provisions of the Indian Stamp Act and Delhi Stamp (Prevention of Under-Valuation of Instruments) Rules, 2007.

Circle rates for residential plots in Delhi