Irrevocable blanket consent taken from flat buyers will not help builders who want to construct additional floors that were not mentioned in original plans at the time of sale, the Bombay high court (HC) has said.
“No such irrevocable consent can be imputed or taken since express previous consent is required to be obtained for all additions and alterations after the plans and specifications (of the building) are disclosed,” said Justice Roshan Dalvi. “No such consent can be expressly given and every (developer) would be required to take express previous consent of all the flat purchasers for all such additional construction… not incorporated in the approved plans.”
The HC upheld a civil court order restraining city-based builder Shah and Modi Developers from adding more floors to Swapnalok building in Malad. Advocate S C Naidu, counsel for the developer, said there was express consent given by the flat buyers at the time of purchase that no permission would be required from them if the developer wanted to make any additional construction and they would not raise any objection.
The judge said that such a clause was “wholly inconsistent with and contrary to legislative mandate” of section 7 of the Maharashtra Ownership of Flats Act. The provision says that a builder has to take the consent of all flat buyers for making any alterations in or additions to the structure of the flats or of the building after plans and specifications are disclosed at the time of sale.
Shah and Modi cited another clause in the agreement which mentioned that the developer can acquire additional construction rights in the form of TDR (transfer of development rights) to add floors. They also pointed to the foundation plan of the building, which showed that it was capable of bearing up to six floors.
But the HC said this did not constitute express consent and the approved plan disclosed at the time of purchase was admittedly up to four floors.
“Upon seeing the lack of consent… a prima facie case for restraint on further construction is made out,” said the HC while dismissing the builder’s plea to vacate a stay on construction from the sixth floor onwards.
For the Times of India story – Click here
For the judgement of the High Court given by Justice Roshan Dalvi – Click Here
A very interesting detailed analysis for Builders and Real Estate Developers including aspects of Taxation for members such as
Liability of Income/Capital Gain Tax, if any, on:-
- Additional area in the hands of individual members.
- Cash compensation received upon surrender of entitled additional area, in part or in full, by an individual member.
- Corpus Money received by the individual members from the Developer in lieu of surrender of part entitlement of FSI/Development rights.
- Corpus Money received by the Society from the Developer and subsequently distributed to its members.
- Rent for Temporary Alternative Accommodation including Deposits, if any.
all this, along with important decided case laws
Click Here for the detailed analysis -
In land-starved Mumbai, managing committees of cooperative housing societies tango with builders to beat the law and browbeat flat owners by opting to redevelop buildings
According to legal and realty experts, while the laws are generally good, society MCs take advantage of sundry shortcomings to connive with builders at the time of executing redevelopment contracts. As a result, tens of redevelopment cases end up in courts. While cases between housing societies and their members land in cooperative courts, a feud among a society, its members and a third party goes to the high court.
At the ward/department level, there are lakhs of cases of such disputes.
The government’s taciturn approach does not help either – legal experts say the departments concerned turn a blind eye to the “dictatorial manner” in which MCs function by flouting laws and disregarding rules.
Many experts are of the view that the Redevelopment Directives of January 2009 U/S 79 are broad guidelines, and are one-sided – they are meant only for members to follow and lack any provision for penalty or punishment for the errant builders. Despite many projects being delayed, no builder has so far been put behind bars, prompting Dilip Shah, senior counsel, redevelopment, to quip, “This is a major lacuna. And builders know that a common man cannot afford to get into a long-drawn legal battle.”
Click Here for the full story
By Accommodation Times News Services
All the redevelopment plans put up by either builder or society itself for redevelopment must accompany a certificate from the Registrar of Co-operative Housing Society who have observed section 79A procedures laid down by Maharashtra Co-operative Society Act 1960.
The Brihan Mumbai Mahanagar Pallika will not entertain any proposal for redevelopment. Section 79A is guide lines set up by State Government of Maharashtra for smooth procedure and unbiased process for redevelopment for societies.
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.
Click Here for the interview