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ARTICLE · 22 MARCH 2023

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Stamp Duty On Permanent Alternate Accommodation Agreements ("PAAA")

Shardul Amarchand Mangaldas & Co
Shardul Amarchand Mangaldas & Co
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Shardul Amarchand Mangaldas & Co

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This update includes a brief synopsis of an important Bombay High Court Order signed on March 1, 2023, with respect to stamp duty on PAAAs to be executed with society members in relation to redevelopment of societies in Maharashtra.

IndiaReal Estate and Construction
Ashoo Gupta
Ashoo Gupta
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This update includes a brief synopsis of an important Bombay High Court Order signed on March 1, 2023, with respect to stamp duty on Permanent Alternate Accommodation Agreements to be executed with society members in relation to redevelopment of societies in Maharashtra.

A society opting for redevelopment can enter into a Development Agreement or a Redevelopment Agreement ("DA") either with the developer alone, or with both the developer and individual society members in certain cases. There are many instances in which the society executes the DA with the developer without individual society members. The society therefore acts on behalf of individual members.

Under the DA, new homes/units are provided to the existing society members in lieu of their earlier accommodation and the additional area constructed by the developer, known as free-sale units, can be sold by the him in the open market. The DA is required to be stamped under the Maharashtra Stamp Act ("Act")

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