Ramprasad Padhi

The abrogation of the Urban Land Ceiling (ULC) Act, the out-dated socialistic legislation, seems to be the first major casualty of the code of conduct that followed soon after the announcement of the municipal elections on Wednesday. Vilasrao Deshmukh government had promised to table a Bill this week before the state Assembly to repeal the archaic ULC Act. The delay in presenting the Bill is likely to extend the life of this Act.

“It will be political hara-kiri to withdraw this Act ahead of crucial elections,” a member of Deshmukh Cabinet said. He was referring to the strong opposition to repeal the Act from various political parties such as the Peasants and Workers Party (PWP), the Janata Dal and the Left. “Withdrawing this socially sensitive Act around this time may offer a political tool to the opponents,” he reasoned.

This means the real estate sector will have to wait a little longer to see this legislation through which has prevented large pieces of land from being developed. Some experts also attribute high cost of property in Mumbai to the ULC. Incidentally, Maharashtra is the last state that has not repealed the ULC yet. In 1999, the Centre repealed the Act, but states were permitted to take the final decision on whether to retain it.

The ULCRA Act allows takeover of surplus land from private holders and using it for housing for the poor.

The Act limits individual land holdings to 500 square metres. The surplus has to be surrendered to the government for public purposes. But private trusts and companies — which are estimated to control 50% of all private land in Mumbai — were allowed to retain their properties if they used it for specific purpose of their trusts. Private developers hold the power of attorney for thousands of acres of such lands. But the Act prevents them from exploiting it commercially.

“Except one project in Mumbai, the Act has not helped the cause of mass housing for the poor. On the contrary, it has been used by the state’s politicians to arm-twist the builder’s lobby. In many cases the builders have joined hands with politicians to exploit the ULC,” an official said.

Though the Centre made the ULC withdrawal mandatory for qualifying for New Delhi’s aid under the Jawaharlal Nehru Urban Renewal Mission, the Maharashtra government has not done enough to scrap the Act.