Hurrying Up to Take Possession? Read This

Coming to the rescue of about 35 flat owners of Navi Mumbai, the state wing of the consumers’ rights commission recently slapped a fine of Rs 1.1 crore on the developer and the construction company, who failed to obtain an occupancy certificate for the 13-storey building. The Maharashtra State Consumer Dispute Redressal Commission ruled that Royal Developers clearly failed to comply with rules, which resulted in major losses for Galaxy Heights Co-operative Housing Society, located at Airoli. Since the developer failed to get occupation certificate for the project, residents were paying electricity charges at commercial rates since 2011. The builder also failed to issue conveyance deed in favour of the flat owners. Additional charges for water connection were also paid by these residents. While a complaint was filed by the housing society in 2013, it is only now that relief has come their way.

The case in study has valuable lessons for those who are planning in invest in property.

When you buy an under-construction property, you have to wait before you take possession. Even if a building is complete and your unit is quite inhabitable, it is important to ensure that developer has received all the documents required for handing over the projects to occupants. The long delay in project delivery often makes buyers averse to the fact that they must check with the builder whether he has all the papers in place. This averseness could cause you a great deal of trouble, on a regular basis.

As has been the case in the above example, government agencies will refuse to offer utilities in case the developer has failed to get the documents in place. Apart from the monetary loss, this would also cause a major problem in case you want to re-sell the property.

The new buyer will definitely ask for all the property-related documents, and a look at your electricity bill would be enough to tell them that they will have to pay commercial rates for utilities if they decide to buy the property.