Hello Abhishek, It seems that BMC will soon start collecting penalty for unauthorized constructions or extensions at twice the property tax levied on the entire illegal area. This was stated by the commissioner of the BMC while tabling the budget.
Hi Shrikant, The provision for the penalty was made under section 152(a) that was added to the Mumbai Municipal Corporation Act, 1888, in April 2010 as an amendment to accommodate the new structure for calculation of property tax. After the amendment, property tax is decided on the basis of a property's capital value.