Alternate to jv agreement to develop a property

Amit (Querist) 15 September 2025 This query is : Resolved
I am in discussion with a landlord to develop his property based in Mumbai.
I will give him a portion of the building which will be made on his land.

What legal document can be executed to save stamp duty ?

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When developing a property with a landlord in Mumbai, a standard Development Agreement (DA) with a Power of Attorney (POA) is common. While stamp duty is typically based on market value, careful structuring can minimise costs by focusing on development rights rather than ownership transfer. An alternative involves forming an LLP where the landlord contributes land and receives a share of the development, then exits, leaving the developer to manage sales. Always consult a local legal expert to ensure the chosen agreement is legally sound and cost-effective.

T. Kalaiselvan, Advocate (Expert) 16 September 2025
In Mumbai (and Maharashtra generally), when a developer enters into an arrangement with a landlord/landowner for development of his land, there are a few possible structures.

A Development Agreement + Power of Attorney (POA) is the standard route.
As per Maharashtra Stamp Act, stamp duty on DA is payable on the market value of the property/land that is being transferred or given for development rights, not just on nominal value.
If no conveyance/transfer of ownership is effected at this stage, but only mutual obligations recorded, then nominal stamp duty applies (usually ₹500 under Article 5 of Maharashtra Stamp Act for an agreement not otherwise provided for).
However, care must be taken: if the agreement gives you possession of the land or rights akin to ownership, stamp duty will be charged on market value under Article 25 Explanation (deemed conveyance).
Alternately execute a Development Agreement (registered) clearly showing land ownership remains with landlord, and developer only gets rights to develop & sell agreed share.
Attach a supplementary JDA or MOU for revenue/area sharing.

Register the DA and POA. Stamp duty is payable, but structured carefully, it can be significantly less than on outright conveyance.
In Mumbai, almost all reputed developers follow the Development Agreement + POA model. It is accepted by banks, SRA/municipal authorities, and courts. Try to structure it in such a way that it records only development rights and not ownership transfer.

kavksatyanarayana (Expert) 16 September 2025
Yes, you and the landlord shall mutually agree on the terms and conditions and then execute the Development agreement with GPA. Consult a local lawyer who drafts the deeds or a senior Document Writer.

Amit (Querist) 19 September 2025
Thank you for addressing my query

A local lawyer suggested forming a LLP company where the landlord enters with the land and we are responsible for the development.(it is open land, so no tenants and thus no DA needed)

The landlord gets a portion of the proposed development. Is issued allotment letters for the said portion, and then exits the LLP.

We are then left with the sellable portion of the building to sell and the LLP can execute the agreements for the same.

Land can stay in the landlords name. Is this a workable solution?

T. Kalaiselvan, Advocate (Expert) 19 September 2025
The proposed agreements and the conditions will depend on the mutually agreed terms based on the prevailing situation hence any decision taken by both sides on a mutually agreed basis may be referred for scrutiny by an experienced lawyer in the local before concluding the deal.

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