In a series of significant court orders that might come as arelief to thousands of housing societies languishing without a conveyance deed,
the consumer court recently held that a developer can no longer hold on to
conveyance on the grounds that he has to carry out further construction on the
plot.
More than 80% of the housing societies in Mumbai do not have
the conveyance deed for their building, the document transferring the plot to thehousing society or the flat purchasers.
Most developers do not execute the conveyance deed as they want
to exploit the redevelopment potential of the plot or any additional constructionrights on the plot in future.
In three recent cases that had come up before the consumercourt, developers argued that their rights to any open space or further developmentwill be retained by the developers. The court not only ruled in favour of the
society in each case but also slapped a heavy penalty on the developers for defaulting
on conveyance.
In Prithvi Enclave Society verses Prithvi builders, the
court recently asked the developer to execute the conveyance within four months
failing which he will have to cough up Rs.2000/- per day of the delay.
According to one of the residents, the society was formed in 2001 and for years
the developer didn't bother to either get an occupation certificate for the building
or execute the conveyance deed in the name of the purchasers forcing thesociety to move the consumer forum. The court held that unless the developer
submits specific building plan approved by the municipal corporation, he cannot
with hold conveyance to the society. The consumer court has also ordered thedeveloper to pay sum of Rs 12.13 lakh to the residents.
Similar orders were passed in Silver Arch Spring Society
versus Sneha builder and in Pleasant Palace Society versus Jain builders.
In case of Silver Arch Spring, the developer has not only
been asked to shell out a certain sum as penalty but also has been ordered to
pay interest on registration charges collected from the society.
Just last year, the Maharashtra Ownership of Flats Act was
amended so as to make it mandatory for the developer to execute the deed within
four months or the residents can apply for a deemed conveyance with thecompetent authority. However, till date not a single file has been clearedunder the amended Act.
According to property lawyers unless the state government simplifies
the procedure for deemed conveyance, it will remain only on paper. "Right
now residents have to submit 36 documents in addition to running from pillar to
post to get the deemed conveyance. The recent court orders are important, inthat they make it clear that developers can't use flimsy excuse of wanting to buildfurther on the plot for not executing the conveyance deed.
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