CM urges Centre to endorse housing regulatory authority

May 29, 2013, 07:18 IST | Ravikiran Deshmukh

In a letter to Union housing minister Ajay Maken earlier this month, Prithviraj Chavan sought swift approval for the Maharashtra Housing (Regulation and Development) Act, 2012, which will help limit mishaps like the Mumbra building collapse last month

The dust is yet to settle after the Mumbra building collapse of April 4 that claimed 74 lives. In an effort to fortify the foundations of the housing sector, Chief Minister Prithviraj Chavan has urged the Centre for an early clearance of the Maharashtra Housing (Regulation and Development) Act, 2012, which will pave the way for setting up a state-level regulatory body.

CM Prithviraj Chavan
CM Prithviraj Chavan

In a letter to Union minister for housing and poverty alleviation Ajay Maken earlier this month, Chavan dwelt at length on the proposed watchdog and its efficacy in ensuring transparency and discipline in transactions of flats, and putting a check on abuses and malpractices. He also focussed on the need for a housing appellate tribunal for ensuring effective implementation of the law, and to promote planned and healthy development and construction, sale, transfer and management of flats, residential buildings and other such properties.

The Maharashtra Housing (Regulation and Development) Act, 2012, approved by the state legislature last year, is a comprehensive statute, which seeks to address specific issues by removing information asymmetry, ensuring full disclosure by promoters or developers and compliance of agreed terms and conditions, while registering, monitoring and supervising housing projects through the watchdog, the CM has said.

The authority is expected to work, on one hand, to protect public interest in relation to the conduct and integrity of promoters and other persons engaged in the development of such flats, residential buildings and other similar properties, and, on the other, in facilitating smooth and speedy construction and maintenance of the real estate, the letter says.

Chavan has also argued in favour of Maharashtra’s authority to enact such a law, citing clauses from the state list. With a note of assurance, the CM says in case the government of India decides to bring about a central legislation on the subject, necessary action to align the state law with the central one would be taken by the state government.

People in the know of the developments concerning the centre’s proposed Real Estate (Regulation and Development) Bill, 2012, say the state is probably apprehensive of a negative response from the Centre. Hence, the assurance by the chief minister.

A balancing Act
The Maharashtra Housing (Regulation and Development) Act, 2012 has provisions for:
>> A full disclosure and compliance with all terms in sale agreements.
>> Flat buyers can approach the regulatory authority for any complaint against the developer. The authority will offer hearing to both the parties.
>> The authority will comprise three members and will pass an order within three months.
>> The bill has some stringent provisions for inadequacy in complying with clauses of the law. A developer can face a penalty of Rs 10,000 per day if he fails to upload details of registration of property details.
>> No sale or marketing of a project can start until its details are displayed on the regulator’s website.
>> Same penalty will be applicable for a developer’s failure to give possession of the flats as agreed.
>> Any willful non-compliance with the orders given by the authority may invite a penalty of Rs 10 lakh or imprisonment for up to three years, or both.
>> The developer will have to make necessary disclosures about the land and proposed development, abide by the sale agreement and seek occupation certificate etc.
>> Developers will have to ensure formation of a cooperative society and execute the conveyance deed.

The number of people killed in Mumbra building collapse of April 4 

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