CHANDIGARH: In a setback for group housing and cooperative society allottees in the city facing challenges with conversion, unearned increase, need-based changes, and completion certificates, the Chandigarh administration has decided to maintain the status quo on these issues. This response comes after a communication from the Ministry of Home Affairs (MHA) addressing five major property-related concerns.
Unearned Increase on Flats
The “unearned increase” imposition remains a contentious issue for housing society allottees. If the original transferee (allottee/lessee) sells, gifts, mortgages, or otherwise transfers rights after the 15-year ban period, one-fourth of the unearned increase must be paid to the government before such registration. The unearned value represents the gap between the original allottee’s purchase price and the market value at transfer permission. The estate officer assesses this market value. Allottees have expressed demands to eliminate or recalibrate the unearned value rates. The UT has informed the MHA that the unearned increase is consistent with various development authorities nationwide, with DDA charging 50% and Chandigarh imposing 25%.
GST on Conversion Fees and Ground Rent
The Chandigarh Housing Board (CHB) provides services to allottees of various sectors, including converting leasehold rights to freehold rights, which attract GST. In 2019, the CHB sought clarity from the GST department regarding this matter, and the request is still under consideration.
Need-Based Changes in Society Flats
Certain changes were permitted by the CHB in 2022, relaxing Chandigarh Building Rules, 2017, but subsequent requests to allow modifications based on the Delhi model were denied. Chandigarh’s unique architectural design and earthquake vulnerability (Seismic Zone-IV) necessitate strict adherence to safety regulations, and unauthorized changes could threaten lives and property.
A court ruling in 2023 stated that the Central government and Chandigarh administration must freeze the floor area ratio (FAR) and not allow further increases. As per a Supreme Court ruling in April 2025, any deviations or violations against planning permission must be promptly addressed by the responsible authority.
The UT has communicated that requests for changes leading to increased FAR, unauthorized construction, or violations of planning and safety standards will not be entertained.
There are numerous cooperative housing societies with land allotted by the estate office over time, with around 112 registered societies as of September 22, 2022. Approximately 6,800 flats have been constructed within these societies.
The CHB has also been active in housing construction, having built 67,565 houses of various categories by March 2019.
