The Brihanmumbai Municipal Corporation (BMC) has announced changes to its policy regarding the installment payments for building permission fees, including Intimation of Disapproval (IOD) and Commencement Certificates (CC). This revision follows multiple extensions and modifications to the original circular issued in 2019. The installment facility, introduced via Circular dated September 17, 2019, initially allowed payments over four and five years for buildings under and above 70 meters, respectively, at an interest rate of 8.5% per annum. After several extensions, the validity of this facility was extended until September 3, 2025.

Key Revisions

  1. Increased Interest Rates:
    • The interest rate for new installment proposals has been raised from 8.5% to 12% per annum.
    • For defaulted payments, the interest rate will be 15% per annum for the first six months from the due date, and 18% for the following six months.
  2. Default Payment Installments:
    • Defaulted amounts can now be paid in four installments within one year, which will include both regular and penal interest.
    • If the first installment is not paid within three months, a stop-work order will be issued immediately.
  3. Payment Conditions:
    • Project proponents must submit a registered undertaking committing to the revised payment schedule.
    • Stop-work orders will only be lifted after the first installment has been paid.
  4. Applicability:
    • The revised interest rates will apply only to new installment proposals not yet approved by the Deputy Chief Engineer (Building Proposals) at the time of the circular’s issuance.
    • Proposals approved under the previous installment scheme will remain unaffected.

This policy revision aims to improve the recovery process for building permission fees, ensuring timely payments while maintaining fairness and financial accountability. The circular will be issued for immediate implementation following approval from the Additional Municipal Commissioner (Projects) and the Municipal Commissioner.

Background

The installment payment facility was initially introduced to assist project proponents by providing a deferred payment option for building permission fees. The increase in interest rates comes in response to financial considerations and delays in payments by some proponents. The updated policy demonstrates the BMC’s commitment to enhancing governance and maintaining financial discipline while offering a structured payment mechanism for developers.

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