Give industry status to realty: Parsvnath

Parsvnath BSE | NSE 10/02/12 Are Mutual Funds betting on Parsvnath?

Pradeep Jain , Chairman, Parsvnath Developers said his expectation from the Budget is that real estate should be declared as an industry. He told CNBC-TV18 that integrated townships must be considered as an infrastructure project. Jain expects an uplift in service tax on commercial property and construction of residential property.

 

Excerpts from CNBC-TV18's exclusive interview with Pradeep Jain:

 

Q: What are you expecting from the Budget? Are you expecting changes on the service tax front?

 

A: Definitely, we are expecting something on service tax. We have a list of expectations from this Budget. Other than service tax, we are expecting that real estate be declared as an industry. We can then enjoy all the benefits from the financial institutions equivalent to the industries.

 

We are also expecting from this Budget that all our integrated townships must be considered as an infrastructure project. We are expecting an uplift in service tax on commercial property as well as service tax on construction of residential property.

 

Q: What about the rationalisation of stamp duty across the country and the necessary guidelines to establish Real Estate Investment Trust , or REIT, as method of listing monetising commercial assets? Do you think the Budget could address either of these?

 

A: Yes, definitely. The rationalisation of stamp duty is a long pending demand with the government. We are requesting the government. But I do not know up to what extent we are able to achieve it. Our requirement is the rationalisation of stamp duty 2-5% across the country. Although a stamp duty is a state subject but the centre must issue the guidelines related to it.

 

With respect to REIT, we are thankful to the government for introducing REIT in India. But some changes and clarity is required.

      

Q: Is there anything that the government can provide in this Budget that will help or boost plans for a lot of players that are actively looking at SEZ as a major income source?

 

A: We are expecting more clarity from this Budget regarding SEZ although there are a lot of benefits related to it. We are enjoying all exemptions, direct or indirect taxes, etc. But we are expecting some more clarity as there is always some confusion between the Commerce Ministry and the Finance Ministry.

 

At the same time, our wish list from the Budget is to introduce a new area of special residential zone, or SRZ, related to affordable houses where the developer can develop the houses below 700 sq ft to take care of the large housing demand of the mass public.