129. This Government has already brought down the rates on stamp duty and transfer duty for conveyance of properties based on the recommendations of the Tax Reforms and Revenue Augmentation Commission headed by Dr.Raja J.Chelliah. This has been widely welcomed. This Commission has also recommended simplification and reduction of rates in respect of several other instruments in order to facilitate better compliance and easier transactions. We have examined these recommendations in detail. We propose to introduce the following measures.

130. At present property transactions within the family take place through the following instruments, namely, Settlement, Release, Partition, Dissolution of partnership. In respect of Settlement and Release between family members, the stamp duty is charged at 4% on the value set forth in the document. In the case of partition, the stamp duty is 2%. In the case of partition on the dissolution of partnership, the stamp duty is 3% on the market value of the separated share. In addition, the registration fee in each case is 1% without any ceiling. The Commission headed by Dr.Raja J.Chelliah has recommended the reduction of the stamp duty rate to 1% subject to a ceiling of Rs.2 lakhs. Based on these recommendations, we have decided to make certain changes. I am glad to announce that the stamp duty on all these instruments will be reduced to 1% on the market value of the property subject to a ceiling of Rs. 10,000. The registration fee will be 1% with a ceiling of Rs. 2000. In the case of partition, the ceiling will be applicable to each share. In case of partition involving agricultural lands, the present concessional rates will continue.

131. Mortgage is widely used as an instrument for advancing and availing of loans. Most of the financial institutions and commercial banks resort to mortgage for securing their loans. We have decided to thoroughly simplify the process in order to facilitate such transactions. The Commercial Banks have also requested the simplification of the levy of stamp duty and registration charges. It is therefore proposed to reduce the stamp duty on simple mortgage without possession from 4% to 1% with a ceiling of Rs.20,000. The registration fee will be 1% subject to a maximum of Rs.5000.

132. In the case of mortgage deed with possession, it is proposed to reduce the stamp duty from the existing rate of 6% on the loan amount to 3% on the loan amount. The transfer duty will be reduced from the present rate of 2% on the loan amount to 1% on the loan amount. The total rate will thus be 4% on the loan amount. The registration charges will continue to be at 1% of the loan amount subject to a maximum of Rs. 2 lakhs.

133. Another important instrument of transaction with the financial institutions is the deposit of title deeds. In order to encourage the proper registration of these transactions, we propose to include Note or Memorandum or any other instrument to be also dealt with as deposit of title deeds. The present rate is 0.5% stamp duty and 1% registration fee on the loan amount. The present rate will be continued. However a ceiling of Rs.5000/- for stamp duty and Rs.1000/- for registration fee will be introduced. This will enable registration of these documents quite easily.

134. Lease is another widely used instrument. A duly stamped and registered document will be of great help in making the transaction clear and transparent. The existing system is very complex with many slabs. It is proposed to rationalize the duty structure as follows. This will be on the total rent and premium or fine or advance, if any, payable.

135. Another popular instrument is the Power of Attorney for Consideration. The existing rate of 6% stamp duty is high and because of this Power of Attorney is not generally registered. Consequently, this can be misused causing hardship to gullible buyers. This can be corrected by buyers insisting on registered Power of Attorneys. To facilitate this, it is proposed to bring down the rate from 6% to 4% as recommended by the Tax Reforms and Revenue Augmentation Commission. The registration fee will continue to be at 1%.

136. Hon'ble Members of the House may recall that the Patta Pass Book scheme has been introduced in 9 districts. One of the conditions is that the Patta Pass Book has to be produced if documents have to be registered. This has caused some hardship. We have now introduced a new system of computerization of taluk offices through which it is possible to give the requisite chitta extracts on an updated basis. Hence there is no more any need to insist that the Patta Pass Book be produced at the time of registration. This condition will therefore be relaxed. This will greatly benefit farmers in getting their documents registered.

137. All the changes that I have proposed, except those requiring amendments to the relevant Sections of various enactments, will take effect from the date of issue of notification under the Indian Stamp Act, 1899 and the Registration Act. 1908 and various Local Bodies Acts.

138. I have outlined several measures for the benefit of the public in my proposals on taxes. Hon'ble Members of the House will note that this is a tax-free Budget and in fact on the orders of the Hon'ble Chief Minister, this Government has proposed several concessions. Even though we have to consolidate the fiscal situation further, this Government has decided to extend these concessions to benefit the public and improve the investment climate. I am sure the Hon'ble Members of the House will greatly welcome the measures that I have just announced.

139. The revenue loss to Government on account of waiver of land revenue, abolition of Agricultural Income Tax, and other concessions to benefit the public is estimated to be about Rs. 140 crores. This will be bridged by stepping up collection of revenue arrears and control of non-productive expenditure. Consequently, the final closing deficit in 2004-2005 will remain at Rs. 590.47 crores. We expect to tackle this by proper cash management and by greater resource flows from the Union Government.

140. The road map for the future has been spelt out in the Medium Term Fiscal Plan, which is set out in the Annexure to the Budget speech. This may be taken as read as part of the budget speech. The effort of this Government will be to consolidate the good progress already made in achieving fiscal balance. The process of fiscal adjustment has been quite complex. Hon'ble Members of the House will be glad to know that the measures we have already taken will provide the framework for further progress towards the goals we have outlined in the Medium Term Fiscal Plan.

141. I have outlined at length the plans and programmes of this Government to be implemented in the coming financial year 2004-2005 based on the rapid strides that we have made in 2003-2004. Some States which started on an economic reform programme much earlier have had the benefit of substantial assistance from various institutions. In Tamil Nadu, it is solely due to the untiring and dedicated hard work of the Hon'ble Chief Minister Puratchi Thalaivi J Jayalalithaa that we have covered so much ground on the road to growth and prosperity in so short a time with virtually no assistance. Had it not been for the unwavering and totally dedicated work of the Hon'ble Chief Minister Puratchi Thalaivi J Jayalalithaa, Tamil Nadu could not have been rescued from the fiscal morass that it had sunk into in the period 1996-2001. A true leader stands out only in the face of adversity. Our leader, the Hon'ble Chief Minister Puratchi Thalaivi J Jayalalithaa has led us from the front, overcoming every obstacle, leaving no stone unturned in the quest for the well being and prosperity of the people of Tamil Nadu.

142. The reward for such hard work and total commitment in the cause of the people of Tamil Nadu will surely find expression shortly. People who are our real judges always unerringly discern the true leader who will stand by them through every adversity and take part in their joys and sorrows. The very fact that Tamil Nadu has marched ahead so resolutely under the leadership of the Hon'ble Chief Minister Puratchi Thalaivi J Jayalalithaa is now a matter of appreciation the world over. It is for this reason that institutions like the World Bank are now willing to come forward to assist the State in its development programme. All these have been made possible in so short a time due to the incandescent and inspiring leadership of the Hon'ble Chief Minister Puratchi Thalaivi J Jayalalithaa.

143. I welcome any constructive suggestion on the Budget for 2004-2005 which will help us to serve the people better. I take this opportunity to convey my heartfelt gratitude to Mr. N. Narayanan, IAS, Development Commissioner and Finance Secretary, for his assistance in the preparation of this Budget.

144. With these words, Honourable Speaker Sir, I commend the Budget Estimates 2004-2005 for the approval of the House.

Vanakkam