The Housing Department, Government of Maharashtra, has approved the disbursal of Rs. 55.86 crore towards the Mumbai Building Repair and Reconstruction Fund, a move that will directly benefit residents of old and dilapidated cessed buildings across Mumbai’s island city awaiting structural repairs and reconstruction.
The Government Resolution, numbered Sankirna-2026/Pra.Kra.6/Dup-2 and issued from Mantralaya, Mumbai, on 28 March 2026, sanctions the release of funds to the Maharashtra Housing and Area Development Authority (MHADA) for crediting into the dedicated repair fund for the financial year 2025-26.
Background of the repair cess mechanism
Under Section 82 of the Maharashtra Housing and Area Development Act, 1976, a repair cess is levied on cessed buildings located in Mumbai’s city and island areas. This cess is collected by the Brihanmumbai Mahanagarpalika (BMC) under Section 85 of the Act. From the total collection, 5% is retained, while the remaining amount is deposited into the state’s Consolidated Fund. The cess amount, along with the government’s matching contribution, is subsequently allocated and distributed by the state government for crediting into the Mumbai Building Repair and Reconstruction Fund, as provided under Sections 86(1) and 97(1) of the Act.
Budget provision and revised release
For FY 2025-26, the Housing Department’s budget had earmarked a total of Rs. 79.80 crore for this purpose, split equally under two heads: Rs. 39.90 crore as the government’s mandatory contribution (head 2216 3295) and Rs. 39.90 crore as the cess collection amount (head 2216 3301), both under Demand No. C-3, 2216 Housing, 103, Assistance to Housing Boards.
Following instructions issued by the Finance Department through its circular dated 12 March 2026 regarding fund distribution within revised estimate limits, and a subsequent communication dated 24 March 2026, the Finance Department approved the release of the remaining undisbursed funds within the revised estimate ceiling. This amounted to Rs. 27.93 crore under each of the two heads, taking the total sanctioned disbursal to Rs. 55.86 crore.
Where the funds will go
The Government Resolution directs that this amount be transferred to the Finance Controller of MHADA. The Finance Controller, acting as the Drawing and Disbursing Officer and Controlling Officer, has been instructed to make this amount available to the Mumbai Building Repair and Reconstruction Board in accordance with Sections 86(1) and 97(1) of the Maharashtra Housing and Area Development Act, 1976.
Why this matters for residents
The Mumbai Building Repair and Reconstruction Board, functioning under MHADA, is responsible for undertaking structural repairs, and in many cases full reconstruction, of old cessed buildings across South and Central Mumbai. These buildings, several of which are decades old and in a precarious structural condition, house thousands of tenants and occupants who depend on this fund for timely repair works and redevelopment support. A steady and timely release of cess-linked funds is critical to preventing delays in ongoing repair and reconstruction projects, and this latest disbursal is expected to support the Board’s work programme for the current financial year.
The order has been issued with the approval of the Finance Department and is digitally signed, carrying the reference code 202603281322194609 on the Maharashtra government’s official portal. Copies have been marked to the Vice Chairman and Chief Executive Officer of MHADA, the Chief Officer of the Mumbai Building Repair and Reconstruction Board, the Finance Controller of MHADA, and other accounts and audit authorities for compliance.
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