The final version of the
much-awaited Maharashtra Housing Bill may turn out to be a mixed bag for Developers
as well as Home Buyers.
Five years after the idea
was first floated only to be canned, revived and tweaked, the State Legislature
at last approved the Maharashtra Housing (Regulation and Development) Bill in 2012,
which paves way for setting up of a Housing Regulatory Authority and a Housing
Appellate Tribunal. Every building
construction project will have to be registered on the Authority’s Website followed
by full disclosure on Land Title, Layout Plan, Carpet and Common Area and all
other Amenities. Only after this the Developers
can advertise or sell flats in the new project. Recently a selected Joint Committee
of the Maharashtra Legislature introduced over a dozen changes to the earlier
version of the bill drafted by the State Housing Department.
The changes meant as a
relief to Home Buyers, they have evoked strong responses from both Developers
as well as Consumers for different reasons. The panel has added a provision
that allows 60 percent of the Flat Buyers to be appointed as an Escrow Agent in
case the Promoter fails to complete the project. The Flat Buyers can then go on to appoint Contractors
to complete the construction and obtain Occupation Certificate.
They have also extended the number
of years for which the Builders are required to provide for maintenance of the
building from three to five years. In
addition to this, they have increased the penalty in case of violations up to Rs.
One Crore including a provision for up to six months imprisonment.
While Paras Gundecha,
President of the Developers’ body MCHI-CREDAI lauded the bill for promoting
transparency, he attacked it for its approach towards Developers as why Developers
alone should be held responsible and not other Stakeholders such as the
Contractor, Consumer or Government bodies?
Most delays occur due to the time taken in getting approvals from the Civic
body or State Government. He also strongly objected to the clause allowing the
Authority to prosecute Developers. This power should vest with the Judiciary
alone.
Housing Society Associations
however, have termed the bill as Lackluster. It is basically old wine in a new
bottle. Already the Maharashtra
Ownership of Flats Act (MOFA) has provisions that can make it mandatory for Developers
to ensure transparency in all their dealing with Buyers but it was never
implemented. Critics have pointed out that the State Bill is a severely watered
down version of the Central Government’s Real Estate Regulatory Bill which
comes down more heavily against errant Developers. Once such lacuna in the State
Bill is that unlike the Central Bill, it doesn’t allow the Housing Regulatory
Authority to put on hold all the projects by a Developer in case of violations.
With a measly budget of
Rs. 5 Crores the Regulatory Authority may just turn out to be a toothless body
with complaints piling up before using it.
Even the revised bill
fails to crack down on several important issues such as charging Buyers for Car
Parking Spare or selling flats on Super-Built up Area.
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