The terms of such an agreement require the developer to build the building in accordance with plans approved by the Bombay Municipal Corporation and other authorities, for which the developer must take the necessary measures. To this end, the owner must allow the developer to carry out the necessary work on the land after obtaining permission from the local authorities. Before discussing what an agreement is for sale, let us understand what the two terms “agreement” and “sale” relate to. Let`s look at tax issues related to development agreements. A few years ago, tax experts felt that development agreements do not result in transfers and that there are no capital gains. They came to this conclusion on the basis of the following factors: “According to Section 2 (e) of the Indian Contract Act, “any promise and series of promises that constitute mutual consideration is an agreement.” The agreement to sell a property in which the property is transferred, either directly or in the future, is considered a “transportation” for stamp duty purposes, although it is not a transport since it does not involve a transfer of ownership. At the time of the agreement to sell a dwelling between the owner and the buyer of the dwelling, the dwelling cannot be effectively present at the time of the sale contract, but, for the purposes of stamp duty, such an agreement is considered a right of transport and stamp if it is due in accordance with Article 25 of the Bombay Stamp Act. B) If the development contract has only been concluded between the housing company (original owner) and the developer, the document that transfers the dwelling/unit to the original member of the housing company is not treated as an ancillary document established for compliance with the initial development agreement, but as an independent document. Therefore, stamp duty on the territory authorized by the housing company for the transfer of housing should be collected by such a document on construction costs. To the extent that the duty levied on the instrument thus set is the highest fee levied for any of the instruments used. As noted above, the rules of the D.P.
were adopted in 23-3-1991. Therefore, if the co-op itself receives the payment directly from the developer, the development agreement will generate long-term capital gains, since the period between the acquisition date and the transfer date exceeds three years. Stamp duty on the development agreement between the landowner (land with or without buildings) and the developer, with the intention of allowing the developer to develop the land through the construction of a new building or the extension of the existing building, falls under Section 5, Point g) of the Bombay Stamp Act 1958. It also includes an agreement between the owner of the property and the developer to sell or transfer.