Legal intricacies are the most common reasons for any redevelopment project’s trailing completion. Very few lawyers are aware about drafting an immaculate development agreement which provides basis for successful completion of a project. As Andheri, Chandivali, Sakinaka and nearby regions take up redevelopment projects of co-operative housing societies (CHS) aggressively, Dilip Shah, Andheri-based senior counselor tells ET about the guiding regulations and prevalent policy paralysis.
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There are many covenants and indemnity bonds the developer has to agree to, with the members in order to have a smooth redevelopment process. The following are some of them :
- The developer should agree to carry out the redevelopment work in accordance with the DC regulations, BMC, MHADA Act and all the other concerned authorities. The society will not be responsible for any breach, if any, committed by the developer.
- The developer must give a Bank Guarantee before commencing redevelopment
- There must be a tri-partite agreement between the developer, the Society and the Member, which should protect the Society and Member interests totally.
- The developer should also indemnify the society/the members against objection, if any, raised by any of the concerned authorities.
- The developer should carry out demolition of the existing structure and construction work at his own cost. If there is no demolition, and the construction is to be carried out in a space adjoining or between the existing buildings, the developer must indemnify the Society and its members in case of any damage to the existing structures.
- Even if the demolition is to be carried out, the developer must keep the Society indemnified in case of any damage to the adjoining or nearby buildings, even if they do not belong to the Society.
- The developer should bear all the expenses for submission of the plans, amended building plans, getting the approval, architects and consultants fees and other costs, charges and expenses related thereto
- The developer should obtain insurance of the labour, workers and all others and indemnify and keep indemnifying the society from or against loss, damages due to inaction or otherwise, on part of the developer, from starting the demolition of the existing building and till the members re-occupy their new flats in the newly constructed building.
- The complete installation which the developer is to undertake for his on-site power supply, shall conform to the Indian Electricity Rules 1966 and Indian Electricity Act 1910, with latest amendments and specifications. The developer shall provide, at his own cost, portable generators to maintain regular power supply for his operations, in case of disruption of power supply. The developer should indemnify the society from any liability, either legal or financial, for damages or delay caused to the developer on account of failure of power supply.
- The developer should provide indemnity bonds for the project. The developer should, throughout the period of development, keep indemnifying the society against all actions, suits, costs, charges, expenses, damages, etc., resulting on account of any act of omission or any breach, delay or default on his part in developing the said property or any rules and regulations, terms and conditions or otherwise.
- Lastly, the developer should not make any claims on the basis of the present Development Agreement after the expiry of the 24 months, till the separate agreement is signed with the society.
ARE GOVT. GUIDELINES REALLY PERSUASIVE AND CONVINCING?
With a view to ensure transparency in Societies seeking to undertake redevelopment projects, the Government of Maharashtra had issued a Circular bearing No. CHS 2007/CR554/14-C, Co-operation, Marketing and Textiles Department Date: 3rd January 2009 this contains a Directive under Section 79 (A) of Maharashtra Co-operative Societies Act 1960 for all the Co-operative Housing Societies in the State of Maharashtra regarding the Redevelopment of Buildings of Co-operative Housing Societies. These guidelines are applicable wherever the buildings of Co-operative Housing Societies in the State of Maharashtra are being redeveloped on a large scale. Read the rest of this entry »
HOUSING SOCIETY MATTERS – 16.01.2013 – Volume I – Issue No.VIII Dt.16.01.2013
- Addresses of various offices of the Joint Sub Registrar of Assurances in Mumbai with their timings
- Matters related to redevelopment. Always advisable to file case for conveyance before Consumer Courts and Metropolitan Magistrates
- How to pay money to Builder while purchasing a flat – Model Agreement
- Co-operative Society and Criminal Law
- Scrutiny Sheet for a Consumer Complaint filed before the District Consumer Disputes Redressal Forum
- What to do if Builder not executing Conveyance and complying with Statutory Obligations
- Redevelopment Tips
Courtesy : Hema Vinod Sampat
ALLOTMENT OF FLATS IN REDEVELOPED BUILDING – by CA PRAKASH VALECHA. M 9821045102
The allotment of Flats is a tricky issue. On the face of it appears a small issue but here many disputes and problems arise. Old Buildings that need to be demolished in redevelopment were constructed sometimes 30 years ago and having FSI of 1.
There are narrow passages with 4 to 6 flats at times on the same floor. As the newly constructed building uses TDR and hence the FSI is 2 and now from 6th January add Fungible FSI of 35 % on the Total Plot area we have total FSI of 2.70. Therefore now the new Building is designed taller and having a sophisticated design which is relevant today. At times there are two storey parking floors.
Many members staying on lower floor want a upper floor while some members are old and do not wish to stay at higher floors as they fear that in case of lift problem or in the eventuality of a light cut they don’t want a particular floor. Some are having a Road facing flat but don’t want the same as it creates noise while some members want a road facing flat. Some Flats are in front side while others art back side. In the new building they wish the same status.
The problem arises is that new building has limited choice which all the old building members want. Therefore for a Fair process of allotment we need to have a policy that is fair and equitable.
Any action is malafide and void ab- initio, if it’s prejudicial, carried out with a narrow objective of favouring a select few while ignoring the majority. Therefore it is essential that certain guidelines and policy decisions are followed that are fair just and equitable..
The Government Guidelines dated 3rd January 2009 throw light on the way to move forward on the allotment of Flats. In point 11 of the guidelines it is stated as follows:
Flats in the redeveloped building should as far as possible be allotted as per present conditions floor-wise and if it becomes necessary to allot flats by drawing lots, on
completion of construction, Developer should make arrangement drawing lots, and at that time flats should be allotted in the presence of Registrar’s representative and this process be recorded by video shooting.
What is suggested in simple terms is:
1. Allot Flats as per present conditions floor-wise.
2. IF that is not possible allot flats by drawing lots.
3. It is the Developers responsibility to make the arrangements.
4. All the interested Members must be present when the Draw of Lots is conducted
5. Registrars representative to be present.
6. Process,be recorded by video shooting
Based on this guideline the Managing Committee and the Builder should follow the above Process as sincerely and diligently so as to make a Fair and just allocation of the New Flats.
Courtesy : MSWA’s Housing Societies Review 16 November 2012
An increase in Floor Space Index (FSI) and the ratio of permissible built up are to plot area and the ever increasing property prices are making developers approach residents asking for permission to demolish their old structure and put up a new building with more apartments for a big house and more money
There are some facts you definitely need to check before you put your society for Redevelopment with a developer
Documents Required by the society :
- Conveyance deed
- Society Registration Certificate
- General Body Resolution to go for redevelopment
- List of member with their respective carpet areas
- C.T.S. plan & property card for the plot.
- D.P. remarks, If the property is under TPS scheme then T.P. remarks
- Copy of municipal approval plans
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Maharashtra Regional & Town Planning Act, 1966.
Sanction to modification to the Development Control Regulation for Greater Mumbai 1991 Under Section 37(lAA)(C) of the said Act.
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The Government of Maharashtra is now coming up with a new master plan for revamp of old, dilapidated cessed buildings in the Housing Societies in the Island City. The State Government will form a cluster of such buildings and prepare the master plan. Though the directives issued by the Government for redevelopment of buildings in Housing Societies are in place (“Directives”), there have been complications and controversies and consequently, the Government is preparing a master plan to be followed by the Developers. As the master plan is yet to come in force, its success is yet to be tested. The process of redevelopment is to begin only once the existing members of the Society resolve in favour of the redevelopment of the housing society.
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The court gave no relief to persons who were in minority and were opposed to the redevelopment. The court dismissed an appeal filed by Mahesh Nandani and others against Sahara CHS to challenge an order of a single judge of the Bombay HC passed last August. The single judge had dismissed a writ filed by Nandani which challenged the order of the Maharashtra Co-operative Appellate Court in the proceedings arising from a dispute under Section 91 of the Maharashtra Co-operative Societies Act, 1960.
The dispute was raised by the housing society which had sought directions to have the residents opposed to the redevelopment project comply with the society’s resolution of September 2006. The society had entered into an agreement with a builder called Raja Builders to redevelop the building which they said was dilapidated.
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