LDA not authorised to levy commercialisation fee

LAHORE – MIAN DAWOOD – The Lahore Development Authority (LDA) cannot collect any conversion or commercialisation fee on the buildings falling in the Commercial Zone of Master Plan for Greater Lahore approved and revised by the District Council in 2004.

The LDA also cannot collect the same on the buildings or properties that are made part of the Commercial Zone by the competent authority. Lahore High Court (LHC) Justice Khalid Mahmood Khan has declared the collection of the same unlawful while announcing a judgment reserved on a petition moved by Omar Iqbal and two others challenging a demand notice issued by the LDA seeking to deposit Rs880,744 as commercialisation fee against his property situated on Jail Road.

After the judgment of the LHC, the LDA cannot even seal any property or building in the commercial zone over non-payment of the commercialisation fee. The LDA failed justify the collection of the fee on a court query: “If once the immovable property is made the part of Commercial Zone by the competent authority even then the regulatory authority can claim commercialisation fee / charges treating it residential.”

According the instant judgment, approved plan is the Master Plan of Greater Lahore, and the LDA has not prepared and got approved any master plan of the City from the competent authority so far. And the bare reading of the Rule 2009 shows that the LDA can charge fee for the use of land of building if the owner is usng the land in violation of the basic status of the land as provided in Master Plan. But, it cannot charge fee if a building already has a commercial status.“The LDA Land Use Rules 2009 show that these have been framed for classification, reclassification and redevelopment of the land and these rules come in to action only in the case of conversion of land use, but the conversion fee is not payable on the property already declared commercial or falls in the commercial zone. The LDA only authorises to claim the conversion fee when the change of status of land is in dispute,” the verdict clears further.

The verdict has declared that Master Plan of the provincial capital is the only valid document until the final report of District Planning and Design Committee that is taking steps for preparing plans to change the existing plan. The decision adds that the conversion or commercialisation fee is only payable on those properties that are notified as residential, industrial or agricultural land in the Master Plan, and not on those lands of buildings that are the part of commercial zone.

The LDA had declared 58 roads as commercial and is also sealing the properties and buildings situated on these roads. According to the LDA commercial policy, the roads where the commercial activity under new policy has been allowed initially are: Gulshan-e-Ravi Main Boulevard, Main Boulevard of PIA Scheme (Wapda Roundabout to Hakam Chowk), Main Boulevard of Johar Town (Canal Link Road up to Nursery Chowk), Main Boulevard of Johar Town (Doctors’ Hospital link-up to Bypass road), Approach Road Shadbagh (From Tajpura Morr to Gol Ground), Multan Road (Yateem Khana Chowk to Defence Road), Defence Road (Multan Road to Raiwind Road), College Road (Ghazi Road to Plot No 1 & 16-5-C-1I Township), Ferozepur Road (Chungi Amar Sadhu to Sua Asil), Main Boulevard of Garden Town, Main Boulevard of Allama Iqbal Town, Main Boulevard of Shadman, M Shaukat Ali Road and College Road (Township), Jail Road, Shabbir Usmani Road (Garden Town), Sher Shah Road (Gullarpura), AI-Madina Road and Bagrian Road (Township), Main Boulevard of Samanabad), Model Town link road, Abu-ul-Hassan Isphahani Road (Faisal town), Wahdat Road, Ghausul Azam Road, Main Boulevard of MM Alam Road, Hali Road, Stadium Road, Noor Jahan Road, Liberty Market, Shahrah-i-Quaid-i-Azam, Tariq Road, backside of the Liberty Market, Ghalib Road, College Road, Park Road and Guru Mangat Road in Gulberg and various others.

The LHC verdict has given a sigh of relief to thousands of traders running businesses in commercial zone of provincial capital. The traders say LDA they were paying million of rupees to the LDA illegally and on refusal the authority was sealing their business. They expect the LDA would obey the LHC verdict and stop its illegal drive of sealing the properties in the commercial zone.

Source: http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/lahore/02-Nov-2012/lda-not-authorised-to-levy-commercialisation-fee