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Your blog is becoming my current event expression forum –
Let me give you 2 bits about the Old Indian Economy and its remaining bits and pieces.
In world of valuation there are two terms Book value and market value. The issue is Indian government never changes Book value to reflect changes in market.
So something that was worth 10 rs in 1947 is still 10 rs.
Weird as it may seem Govt has its own way to appreciate its book value to reflect real market changes –
To give you few examples,
Government Servents pay is given to the rate decided by Pay commission. Then Govt pays DA to get the salary to respectable level.
If you Look into schedule of rates for Govt contracts the rate for Cement (if not revised) may be 50 Rs while actual cement is sold at 200 Rs. So match up this contractors fill up 300% above rates.
Coming to land there no such fair market valuation is involved. Whatever is the cost decided at the time of registration never gets reviewed making the book value of the land or the real estate virtully COMIC. Thats the same reason why there is a white money and black money people why buying real estate.
The white money is what “Fair market value of the property” per Govt. Black money paid on top is actual market price. This way govt makes two mistakes… Makes the property look really cheap. And it looses all the taxes on Black money.
Practically got losses nothing to call somthing at its actual market price but somehow nobody bothers to change it.
Now coming to the issue that you are raising, as there are no changes to registered price of the land its the real pricepf tthe land in the blind eyes of Government.
There are two solutions though,
1. Govt changes it its rules to decide the value of the property (As its the sole decider in social economy. In capitlist economy market decides the price)
2. Or judiciary forces Government to make these changes
Define Irony —-
So much for the Open market. SEZ is supposed to be the part of making open markets and bringing capitalism and we are using old socialist (Partly communist) laws to make that happen.