Team Herald

PANJIM: Lease holders of immovable properties under the jurisdiction of municipal bodies will have to mandatorily clear the arrears before signing new lease agreements.

In a communiqué to the municipal bodies, the Director of Urban Development has directed to submit the proposal of renewal of lease only after all arrears are paid by the lessee.

In addition, the circular has stated that the rent fixed, as per the rent certificate issued by the PWD and with annual increase of rent at the rate of 10 percent, will be implemented.

The orders have been issued in the wake of the observations made by the Directorate of Urban Development that ‘inspite of huge amount of arrears outstanding from the lessees, the municipal councils are submitting the proposal for renewal of lease without recovering the arrears’.

Sources in the Corporation of the City of Panaji (CCP) said that the order will now force the lessees to pay a rate higher than that proposed initially.

In CCP’s jurisdiction, the circular will have an impact on the contentious issue of signing of lease agreements which has been lingering a long time. These include shops located at the CCP building as well as shops in the municipal market.

Sources said that CCP had proposed to the shops in the CCP building a rate of Rs 250 per square foot, however, now the lessees will have to shell out around Rs 390 per square foot as per the rate card of the PWD.

The shops in the municipal market too, which have been delaying the clearing of arrears and signing of new lease agreements, will now be compelled to shell out additional amount in contrast to the demands put forth by the market traders earlier. 

The move is seen in the direction of generating revenue for the local governing bodies and adding to the funds of the municipalities.