Two issues that plauge apartment owners.

Apartment owners in cities are plagued by two major issues.

One is that the builder seldom gets an occupation certificate for the building and the other is that the builder seldom transfers the title and interest of land to the society on which he has constructed the building.

The reasons for this behavior can be found in personal greed and the lack of strict application of law by the law makers and law keepers.

According to Maharashtra Ownership of Flats Act, an act under which all apartments are sold in Maharashtra, a builder can not give possession without first getting an OC (Occupation Certificate). But builders do give possession and the municipal corporations extend facilities like garbage collection, sewerage and water connections to such buildings. According to MOFA all such buildings are illegal and the builder is punishable with a penalty calculated on a daily basis for giving possession without obtaining an OC.

Obtaining an OC requires that the builder subject his project to final scrutiny by the local government officers and payment of fees for infrastructure development like roads, gutters, sewerage, storm water drains, etc. The builder in connivance with the local government officials often fails to pay this fees and disappears from the scene.

He starts another project and does the same trick there too. No builder has yet been penalized or his business license canceled because he has not obtained OC for his buildings.

The other matter of conveyance of title and interest in land to the society. This too is not done deliberately because the builder even after getting money for every square inch of land and building constructed wants to retain control over the land just in case some future government relaxation in development rules may allow him to add some more apartments to the same building and on the same land.

To add insult to injury, local governments, like the Mumbai Municipal Corporation impose a higher charge for water supply, sewerage and garbage collection. Also all such buildings are illegal and subject to threats of demolition from the corporation.

What does the Maharashtra Chamber of Housing Industry (MCHI) have to say about this? What has it done to rein in the black sheep amongst its members? How many builders have been thrown out of the the association for violating the letter and spirit of laws meant to protect purchasers of apartments?

In light of this the recent article in Times of India about government considering giving amnesty to pre-2001 buildings within municipal limits of Bombay is a ray of hope for societies that have been left in the lurch by unscrupulous builders.

Read the article here

PNB does not get it!

I have a current account with PNB (Punjab National Bank) at Mira Road. Today I went to the bank to request a new cheque book for this account as I had run out of cheque leaves.

The bank asked me to submit the requisition form from the old cheque book. It also asked me to write the complete mailing address at the reverse of the requisition slip along with my phone number.(How stupid of them, they already have all these details on their record. What if I had mentioned a different address? Would they have sent me the cheque book at that address?)

Then the lady at the counter told me that I will soon get an SMS and an alert about the impeding arrival of my new cheque book.

And that the cheque book will arrive in 10 DAYS!

When I remarked that earlier one could get the cheque book the same day, she told me the bank is now computerized and cheque books are processed and dispatched centrally.

Whereas the whole world is going for de-centralization, PNB just does not get it and is going in the reverse direction.

When I got slightly upset, the lady got more upset than me and directed me to speak to her manager!

Fat good that was going to do anyway!

The Rot Within

Corruption stories abound. No area of public life has been spared. Ketan Desai, Chairman of Medical Council of India (MCI) was recently caught for accepting 2,00,00,000 from a Punjab based medical college for allowing medical seats.

If MCI takes bribes for allowing medical seats, what is wrong with Medical colleges asking for huge fees and accepting bribes?

If Ketan Desai is accepting bribes, I am sure he must have paid a handsome amount to land the appointment as head of MCI in the first place.

The question is who appointed him as president of MCI?

If India has to make progress, the rot within has to be stemmed. Because corruption allows those with money and without any merit to corner opportunities and those with merit are deprived of those opportunities.

State decides to crack down on illegal buildings

From a report appearing in Times of India, dated 24th April 2010.

TIMES NEWS NETWORK

Mumbai: Carrying out illegal constructions in the civic corporation or municipal council limits will now prove costly for a civic official, literally. To check the rampant unauthorised constructions across Maharashtra, the state government on Friday brought about a new law to penalise the designated officer who permits such illegalities.

Both the Houses of the state legislature on Friday approved the Maharashtra Municipal Corporations, Municipal Councils and Maharashtra Regional and Town Planning (Amendment) Act, 2010. As per the provisions of the modified Act, a designated officer will be appointed to ensure that there are no unauthorised constructions in the jurisdiction of the respective municipal corporation, council, panchayats and industrial townships.

The new law stipulates that “if the officer fails to take action, she/he faces imprisonment for one month and/or a fine of Rs 25,000’’.

Stressing the need for amendment to the existing law, Sachin Ahir, minister of state for urban development, who piloted the Bill in the legislative assembly, said that whenever action is initiated against illegal construction, a stay order is obtained from the court, which is not vacated for several months. “It is known that such stay orders are granted liberally,’’ he said.

In March this year, the state had also decided to set up “special courts in the area of municipal corporations with the approval of the high court to ensure speedy trial of offences under municipal laws and the MRTP Act under which action is taken to demolish illegal structures’’.

To ensure that the Act is effective, the government has already sanctioned the deputation of an additional commissioner of police or deputy commissioner of police to the municipal corporation, said Ahir, explaining that the municipal commissioner can decide who the designated officer should be. “This is being done so that blame is not passed around, and a person is held responsible,’’ said Ahir.

The government also admitted the failure of various agencies to stop the growth of unauthorised constructions.

In the past, the government has sanctioned proposals holding the local assistant municipal commissioner and the police inspector responsible for unauthorised constructions in areas under their jurisdiction, but till date, no action has been taken against any officer.

Do not buy parking spaces!

Builders have been taking the gullible home buyers for a ride. For a very long time builders have been selling open and covered parking spaces. Most of these transactions are without any legal documentation being executed between the buyer and the seller and in cash.

These transactions are in contravention to the laws of the land and thus illegal.

Builders sell apartments on Super Built Up area basis. Such a sale includes all the amenities and plot on which the building stands. Open spaces are thus already sold through the basic sale agreement. Stilt parking also come under the ambit of open spaces which can not be sold as per Maharashtra Ownership of Flats Act.

A recent Bombay High Court judgment has affirmed this position.

Click here to see the judgment.

If you have already bought a garage/open parking /stilt parking, then the only recourse is to get a refund from your builder within 3 years. If you do not do this within 3 years a statute of limitation applies.

Rahul Gandhi takes the local train

Rahul Gandhi, Indian National Congress Member of Parliament and Prime Minister in waiting visited the city of Mumbai (Bombay) in the face of threat of disruption by Shiv Sena.

The Shiv Sena has been claiming that Mumbai (Bombay) belongs only to the local Marathi Manoos, while all other political parties, including its one time allay BJP has distanced itself from the Sena on this issue and subscribe to India for Indians doctrine.

To rub in the slat into the raw wounds of Shiv Sena, Rahul Gandhi boarded a local train from Andheri Sation and changed over at Dadar to travel to Ghatkopar where he is meeting the youth from a slum

When was the last time Uddhav/Raj/Bal Thakkrey traveled by local train?

Real estate bubble building up again in Mumbai

Mumbai: Mumbai’s real estate prices have begun to run amok once again, suggesting that another realty bubble is in the making. In a quick reversal from last year’s recessionary trends, residential property prices which had dropped by almost 35% in some areas have risen sharply in the last nine months and are now close to their earlier peaks of 2007-08.

The rise has been sudden both at the premium end of the market and the deep suburbs, suggesting the return of speculators and investors to the property market.

A three bedroom-hall-kitchen (BHK) apartment at upmarket Warden Road was recently sold at Rs93,000 a sq ft (built up rate) when it was quoting at just Rs 50,000 in early 2009. Apartments (mostly owned by investors) in Beaumonde, a building by Sheth Developers at Prabhadevi, are now quoted at approximately Rs50,000 a sq ft as against Rs35,000 and above in 2008. Apartments at Planet Godrej, developed by Godrej Properties at

Mahalaxmi, are being quoted at approximately Rs27,000 a sq ft, close to the peak rate of Rs30,000 a sq ft quoted in 2008. Prices in 2008-2009 had dropped to almost Rs16,000 a sq ft.

Raheja Vivaria at Mahalaxmi is now quoted at Rs26,000 a sq ft, close to its high of Rs30,000 a sq ft in 2008. It had dropped to Rs16,000 a sq ft at the trough earlier in 2009. Similar was the case with Ashoka Towers at Lalbaug which is now quoting Rs 25,000 a sq ft. Prices at Cuffe Parade, Nariman Point and Altamount Road, which had dropped to almostRs40,000 a sq ft, are back to their earlier rates between Rs50,000 and Rs70,000

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Societies can get conveyance with single document

Mumbai: Here’s heartening news for housing societies struggling to obtain titles to the land on which their flats are located. Once proposals submitted by a state committee become law, societies will merely have to submit a list of flat purchasers (members) to be eligible for deemed conveyance.

A draft notification, formulated earlier by the state housing department for granting deemed conveyance of the land and the building to housing societies, had proposed the submission of 21 property and title-related documents. The provision of deemed conveyance was thought of in cases where there were long delays by builders in this regard.

Following objections raised by several housing societies and individual flat purchasers, a state-appointed committee working on the draft notification has now modified the clause. “Possessing even one of these 21 documents will now make the society eligible for applying for deemed conveyance,” said Sitaram Kunte, secretary, housing department, who is also chairing the committee. Kunte made this announcement during a convention on deemed conveyance organised by MP Sanjay Nirupam for the benefit of housing societies in the western suburbs.

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Banks pulled up for fine on home loan pre-pay

NEW DELHI: Competition watchdog CCI has asked about two dozen banks and housing finance companies, including HDFC, ICICI Bank, and LICHF, to explain their imposing penalty on borrowers for pre-payment of home loans.

The commission, according to official sources, has sent notices to major home loan players after examining a report of director general (investigations) which found evidences against banks for misusing their dominant position and entering into anti-competitive agreements.

"We have sent showcause notices to 20 banks including ICICI Bank, HDFC, LIC Housing Finance, Deutsche Postbank and the Indian Banks' Association. We have also sensitised RBI on how the practice of charging pre-payment penalty is hurting consumers," a senior CCI official said. The commission was scrutinising a complaint filed by a customer against the practice by these banks.

Read the report here

Another Update on Forest land: Mumbai builders get nod

NEW DELHI: It is probably the best news for Mumbai's leading builders who had invested thousands of crores of rupees on buying prime plots to develop flats and residences but got stuck in the environment tangle as the land was classified later as forest area.

After years of uncertainty, the Supreme Court on Monday cleared their construction activity. However, the green light came with two riders — one they must pay the hefty penalty (Net Payable Value or NPV) slapped on them for using forest land for other activities and two, that the constructions would remain subject to further clearance from the ministry of environment and forest (MoEF)

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