Maharashtra Government Waives Stamp Duty to Boost Enemy Property Auctions

Maharashtra has introduced a significant policy initiative to boost the auctions of enemy properties by waiving stamp duty and registration charges. This decision, taken in a state cabinet meeting, is expected to lower the cost of transactions and attract more buyers into the property market, according to officials.

Enemy properties are assets left behind by people who moved to countries hostile to India, primarily Pakistan and China, following wars and geopolitical tensions. These properties are managed by the Custodian of Enemy Property for India (CEPI) under the Enemy Property Act, 1968, enacted after the 1965 Indo-Pak war. The law initially prohibited the disposal of these properties in any manner. However, amendments in 2017 gave CEPI the power, with the prior approval of the central government, to sell or dispose of these properties through e-auctions, tenders, or quotations.

Despite these changes, the interest of bidders has been low, leading the state government to take this latest policy step. A senior official from the state revenue department explained that the waiver of stamp duty and registration charges was a relief measure to one of the major hindrances for buyers. The move is expected to bring down the property cost and attract more participants to property auctions.

The combination of stamp duty and registration charges can be a considerable burden for buyers, especially in high-value urban areas like Mumbai. By exempting this charge, the government aims to make enemy property auctions more attractive and a normal source of revenue. This move is also intended to encourage developers and institutional buyers who have been hesitant to participate in the process.

Maharashtra is one of the largest holders of enemy properties in India, with a total of 428 properties. Mumbai alone accounts for 239 of these properties, highlighting the concentration of these assets in high-value urban areas. Of these, 62 are located in the island city, while 177 are in the suburbs. Outside Mumbai, the distribution includes 86 properties in Thane, 77 in Palghar, 11 in Ratnagiri, six in Nagpur, and four in Pune. Smaller numbers are located in Chhatrapati Sambhajinagar (2), Jalna (2), and Sindhudurg (1).

Most of these properties have been subject to protracted legal and administrative processes, causing them to deteriorate and lose value gradually. Limited awareness and doubts about titles have further weakened the auction's appeal, even though the 2017 changes have made sales possible.

The stamp duty waiver is expected to enhance the existing CEPI auction streamlining and outreach initiatives. By reducing the total cost of acquisition, the state government believes more bidders will be attracted, increasing the likelihood of sales at higher prices and successful deals.

Officials emphasized that all transactions will still be carried out under existing legal safeguards, and central government approvals will be obtained. The waiver is exclusively for stamp duty and registration charges and does not change the conditions of ownership or the requirement for compliance with the Enemy Property Act.

The significant concentration of enemy properties in Mumbai and its neighboring districts means this move could also release long-idle real estate assets, aiding urban redevelopment. Improved auction outcomes are expected to help monetize dormant properties and reduce the government's administrative burden of managing them. The next auction cycles will be closely monitored to see if the stamp duty waiver translates into real bidder enthusiasm and finalized deals.