Bhubaneswar: The Bhubaneswar Municipal Corporation (BMC) has served notices to owners of 40 residential houses for illegally using houses for commercial purpose.
BMC officials said that holding being a primary source of revenue is being assessed regularly by the authority.
“During the investigation, it has come into the notice in the North Zone area of BMC. Owners of residential houses are hiding the utility of their houses/holdings for avoiding legality of tax and instead have made it residential holding instead of declaring the same as commercial,” said a BMC official.
“The resident owners have declared them as residential holdings but running business like hotels and guesthouses in the premises which is a violation and punishable under the Municipal Act,” said Pramod Kumar Prusty, Zonal Deputy Commissioner, North Zone.
BMC officials further said that the house owners served notices have not even obtained trade licenses and some companies like OYO are running business in such houses.
There are three types of holding taxes namely residential, rental and commercial. There are area-specific charges of the tax where land value is a major concern along with plinth area, floors of the residence as well as electricity and water components.
For example, if the plinth area of a residential holding about 1000 sqr. feet, the holding per annum will come around Rs 250; whereas it will be about Rs 24000 if the same place is treated as commercial holding.