Thursday, October 9, 2014

REALITY O' realty ! contd.

Down (OR UP ) the Memory Lane >

BAR & BENCH (a  quick peep, out of sheer curiosity)

 Shankar Srinivasan
A new comment was posted to the article

The apartment law you must know: Sanjay Vijayaraghavan ...

There are many doubts among the Owners of apartments, on registration of apartment owners association.

2. The apartment Owners association, has to be necessarily to be registered only under Karnataka Apartment Ownership Act 1972 only. 
3. Many Advocates and experts misleading the Apartment Owners to register under Scoety's Act 1960. 
4. First and foremost, the process as stipulated in the KAO Act 1972, is not being followed by all the Builders and as in absence of stringent law to monitor this lacunae, most of the practicing Lawyers and professionals misguide all the apartment owners to form and register the association under Society’s Act 1960, which does not have any provision to register such apartment owners association, thereby violating the very purpose of KAO Act 1972. 
5. The act of registration of Association under the Karnataka Societies Registration Act, 1960 (in short KSRA) itself is illegal as there is no provision in the said act to register the Apartment Owners Association mainly undertaking the routine maintenance activities, repairs, painting, providing various facilities connected with apartment living. 
6. According to KAOA, the owners of all apartments form an association. Although the association is not registered, its officeholders are given powers. 

7. But the KAOA does not elaborate the role of association in the whole life cycle. It does not specify that a customer becomes a member as soon as he books an apartment (as per KOFA).* The builder exploits this by denying the existence of an association that lets the customers exercise their rights unitedly. 

8. There are many Lacunae in Karnataka Apartment Ownership act 1972, which needs to be amended by raising a strong voice unitedly.
*Ref. marked portion; extremely confused !


Indian Corporate Law

Posted: 03 Dec 2014 06:19 PM PST
Last month, we had carried a guest post summarising and commenting upon the changes to the FDI norms in the construction industry, which relaxed several conditions. Now the Department of Industrial Policy and Promotion (DIPP) has made these changes effective in the form of Press Note No. 10 (2014 Series).

On the first blush/tentative read :

Random Jottings

POSERS ? et al



Have all the ostensibly INHERENT /POTENTIAL anti-people aspects been fully and consciously looked into, discussed and debated



MANY OF THE VITAL AREAS LEFT TO BE TAKEN CARE BY THE STATES - each state having its own law, rules , regulations, mutually varying, mosty impacting and impairing uniformity, the trumpeted objective of central regulation 

And , quite probably many more   the so called experts  should certainly be aware /think of, with lacer sharp focus on societal welfare in its puritanical as well as if viewed with common sense 

 (Yet To Edit)


Residents take builder Devisha Infrastructure to court


a) The assessee entered into an agreement for development of land in terms of which he handed over the possession of land to the developer.

b) As per development agreement, assessee was to receive a part of built-up area. Besides, the developer had also given certain advance to assessee.

c) During the course of assessment, the Assessing Officer ('AO') opined that as the assessee had delivered possession of the property to the developer, there was a transfer within the meaning of section 2(47)(v), read with section 53A of the Transfer of Properties Act ('TP Act') and, thus, assessee was subject to capital gains tax.

d) The CIT (A) set aside the order of AO. The aggrieved revenue filed the instant appeal.

The Tribunal held in favour of assessee as under:

1) The CIT(A) had rightly held that neither entering into the development agreement nor handing over of the possession of property was the sole criterion to construe transfer of capital asset as envisaged under section 2(47)(v).

2) The handing over of possession by the assessee towards part performance of contract would not amount to transfer unless the transferee was also willing and ready to perform his part of the contract under the development agreement.

3)In the instant case, the developer had not taken any step towards development of the property. He had not taken any steps to get sanction/approval of plan for construction of building from the competent authorities. Not even a single development activity like leveling of land, sales promotion had been initiated by the developer.

4) The department had not controverted these facts, thus, it clearly demonstrated unwillingness on the part of the developer to perform his part of the contract.

5) Therefore, when the developer had not performed or there was unwillingness to perform his part of the contract, it could not be concluded that there was transfer of capital asset in terms of section 2(47(v), read with section 53A of the TP Act. – ACIT v. R. Srinivasa Rao (2014) 50 178 (Hyderabad - Trib.).

Nov 25

 Promise what you can perform : V Naidu

[The following post is contributed by Prachi Narayan of Vinod Kothari & Company. She can be contacted at]




A Quixot

Has rightly brought to the fore yet again the several causes which are responsible for the invariably experienced disgusting / heart-rending delays in ‘consumer’ getting relief prayed for through the special fora in place. More rightly, the case of Apartment CHS has been chosen and dealt with for case study. For, it is this category of disputes, mainly aggrieved buyers of apartments/ flats, who quite commonly take this route for having settled varying types of disputes, against promoters. The thinking behind has, however, as a rule, than an exception, increasingly come to be belied. For the most expeditious way of disposal, the idea heard to have been mooted and under consideration, in relation to other fora, such as tax tribunals, might be worth trying and implementing. That is, to require both parties present their respective pleadings in writing; and to do so,- (a) in as comprehensive a manner as to serve the purpose of effective adjudication by the forum, in one go, and (b) electronically (e’mail),


New name for super built up is “Liveable Area”

<In Maharashtra Ownership Flat Act , MOFA,( will be repealed by Maharashtra Housing Regulatory Act 2012 soon after president’s consent) it is expressly provided that all the areas in the model agreement must be carpet areas as defined DCR, i.e. inner surface of wall to wall inner surface of wall and height being 3 mtrs i.e. minimum 10 ft.>

<>From the buyers’ viewpoint , the long winding explanation of the new concept  is prima facie nothing but much ado about nothing. For what one knows or can readily conjecture from the erstwhile state of affairs, may be, at the end of the day, promoter is going to charge, and buyer is going to be called upon to pay, the same price, for his ‘flat’ property, as if the concept change has no role to play in the modality of ‘pricing’. 
Further, one is not clear on what the write-up conveys as regards stamp duty, etc. In any case, for the same reasoning, the concept change may not impact, quantum wise, the incidence of stamp duty (besides VAT, property tax, etc.), which can be expected to be levied as so far, on the same so called "fair market value”.  The writer will do well to reapply his mind to the foregoing aspects and bring out, with sufficient clarity, for the benefit of the readers, the real thing in store for the future.


Chintan Bhatt

I Bought Under Construction Properties and Project got delayed for more than a year. So I decided to Move in my Flats without OC and Permanent Power. Builder told me that Permanent Power will be there in the Month of November, but still it is not there and while checking with him he is saying that there is a rule change to get Power Connection - First need to get OC and then only they will allow power Connection.
My Quetion is - Is it applied for Old Projects also which are not completed or for New Project only?

Also, as Block B Construction is not completed yet. Still Brick Work is pending for the Appartment, will there is any way to get OC.

Whom to go for More Information for File Grivences with the Builder.

A blind alley or 'Trishanku' ? Or Caught between the Devil and the deep sea ?? Pity !

"Builders optimistic of the economic environment"


Gujarat builder sentenced to a year in jail for ignoring complaint, violating consumer rights

BL (realty related)

A home of our own? No, thanks

< Read Comment by MEHER, et al  (For a bird's eye view, even if not believed to be from a 'legal eagle')


Feb 15, 2013 - National Seminar on Legal Risks in Real Estate and Construction Projects ... Consultation for Second Generation Reforms in Legal Education.

Taking on the goliaths

Impact: While the final order has not been passed, it has increased the awareness of flat buyers about the unfair practices being followed by many real estate companies. In fact, following the CCI order against DLF, several other complaints have been filed — against other DLF projects and also other builders — with similar observations being made by the CCI in some of these cases.
 As regards the flats buyers of the Belaire project, while the sale deeds are yet to be executed given the ongoing litigation, they have got possession of the flats. Moreover, the Belaire Owners’ Association is all set to file a hefty compensation claim against DLF, as provided for in the Competition Act, says Sanjay Bhasin, President, Belaire Owners’ Association.   
 Some large companies take undue advantage of their dominant position. You can now deal wit...



The hidden costs you incur when buying a home

Oct 30

 Service Tax on Transfer of Development Rights of Land – A Detailed Legal Analysis

Where are 5 lakh houses to be constructed before 2015?
 a quixot says: Your comment is awaiting moderation.

“Homes for All” as a fondly mooted slogan and dubiously propagated as a set virtue for/by both the men in governance and the governed, as brought out in the light of the blunt observations in the write-up itself,but having every regard to the field reality, in one’s longstanding conviction,is a sheer ‘ideology’; in short, never seriously intended as a policy to be pursued devotedly as an ideal solution for providing any succor to the 60% (as roughly, be it correctly or otherwise estimated, for Mumbai alone)living in ‘informal housing’ 9meaning no real or decent ‘housing’ by any human standard).


ICL (contract law)

 Revisiting penalty clauses in contract

Basements can be sold and registered independently in Haryana
In a landmark judgment that is bound to bring relief to property owners, the Supreme Court ruled on September 17 that basements of residential houses can now be sold and registered separately in Haryana.

 <>The narration of the apex court verdict is too confusing to prove brain teasing; rather the already obtaining large scale confusion happens to be worse confounded. Especially, to anyone who has read and is expected to have a reasonable understanding of the special law in force in most of the States applicable to multi-unit building complexes. To give a hint, the  very concept of ‘basement’, as is generally and broadly understood , denotes the floor space meant for car parking; further, is to be sold / conveyed only to the unit purchasers, for a price, along with the unit to which it is regarded as appurtenant. So much so, anyone wanting to know the  true legal implications of the reported court case would be obliged to first ascertain what the domestic law of that state, if any applicable to ‘units’  says; also, to closely  read the judgment if and when reported, so as to understand it in proper light/background.
This is not the first instance when the Press has sought to project a court verdict as sensational news of ordinary type, but presumably having no idea at all, of the setting in law in which the ruling has been rendered. Looking back, what comes to mind is the SC decision handed down not long ago in re. Nahalchand, the after effect whereof still continues to haunt the minds of everyone concerned, including builders, albeit that is in the state of Maharashtra. A critique of that court case may be found to have been published and available in public domain, for the common good. In fact, it is noted, on the first blush, prima facie, the view  (on the primary issue) in Nahalchand's case the apex court has taken is diagonally opposite to the view now taken in the instant case. Further, the impression given that the ruling in the instant case brings relief to buyers may prove an illusion, for that fails to bear in mind that, in the ultimate analysis, from the viewpoint of the 'common good', it might not turn out to be so but work out differently. 

click here    AND

Key Note:

Search Result (for ready Reference)
Received the assent of the Governor of Haryana on 26th September, 1983, and was published in the Haryana Gazette. (Extra), Legislative Supplement, Part I, ...
An Act to provide for the ownership of an Individual apartment in a building and to ... (1) This Act may be called the Haryana Apartment Ownership Act, 1983.
developed. The Haryana Legislature enacted the Haryana Apartment Ownership Act, 1983 (1983 Act) to provide for ownership of individual apartments ...
Mar 28, 2012 - (1) This Act may be called the Haryana Registration and Regulation .... under the Haryana Apartment Ownership Act, 1983 (Act 10 of. 1983) or ...

Worth the efforts to study in detail the court cases HERE >

For a typical sample , HERE>

View Complete document

Service Tax  AND  Comp. Cert

MF(DR) ORDER NO. 1/2010, dt. 22-06-2010 - Service Tax

< A pragmatic  Relaxation; if  that were so, even for 'service tax', a governmental purpose, why not for less significant purposes ?

Also, in changed circumstances@, rendering local authority's certification a purposeless or no more than a sheer futile formality



Cross refer >

Basements can be sold and registered independently: SC

 Independent registry of basement, haryana - Lawyersclubindia › ... › Registration & Stamp Duty


Another Apex Court ruling, recently reported, on "apartments" > new

Property developers upbeat | Business Line

India set to see urban housing demand for 13 million units »

Sometime ago, the RBI Chief, presumably while being  in a highly sentimental mood, was reported to have remarked that the realty prices are overstated. It is heard that, in metros such as Mumbai , lately the prices have skyrocketed and reached such an unbelievable height that not even upper middle category, particularly salaried class,  can dream of having a home of own in lifetime. To have a look at the tip of the iceberg, information from a friendly source is that apart from the price of a flat, almost touching no less than a crore, even in less developed suburbs , having an allotted car park costs no less than a few lacs; while , of course,  if it were in a better location, to cost  much more than the price of a high end car. All the more obnoxious and frightening is that, promoter wants payment for car park space in hard cash. It appears that, this is a recent development; and is traceable to the  apex court's ruling, - which in legal circles, has come to be pinpointed as stemming on arguments advanced in the proceedings, prima facie, bereft of any  sound reasoning or founded on faulty logic, -  not long ago holding that promoter has no right to sell, and charge a price, for parking space to flat buyer. It is high time that the newly installed  men in governance care to turn their necks round/ back, not away, to take a conscious note of and take steps to effectively curb such horrid  ideas/ practice, despite the ongoing urge and irritable, nay anti- social move if regard be had to the after effects,  for ‘urban development’ over zealously projected / thrust upon the humanity,  as  inevitable . Failing which, for obvious reasons, all tall talks to check / control the twin evils of ‘corruption’ and ‘inflation’, giving rise to a notorious vicious circle,  are doomed to remain as hollow or shallow as the mostly dominant mindset behind  modern day thinking on any such matter entailing common good, inflicting upon grave public interest. So much so, the inevitable result could only be for both they in governance and the governed to live in ‘sin’ in perpetuity.


Anti Corruption Bureau launches helpline number

To Relate: 




Quoting Pathak J, from a landmark SC Judgment, observed: 

The responsibility fixed on the court is serious one. And there is no need to warn that this power...can have grave consequences if the content of its potential is not truly appreciated and realized by those who wield it. Whenever a Court breaks new ground, the development and recognition of new rights is often accompanied by the birth of problems surfacing also for the first time..... UQ

Source: ‘Memorial’ lecture delivered on the subject of SC’s judgment in 
“the Judges’ case”

  • Share Certificate - by Dinesh Kandpal
  • In a registered housing society, if some flats are illegally constructed, can managing committee refuse share certificate to such flat owners? These members are paying maintenance charges as well to society? What is the rule?
 Xpert's Replies make for an interesting reading ?!

Blackmailers using RTI Act to blackmail builders

Home buyers not fully convinced about recovery in real estate sector

» Read more

The builder was deficient in his services towards the customers of the society and violated the provisions of the Maharashtra Ownership Flats (Regulation of the promotion of construction, sale, management and transfer) Act, 1963, the forum observed.

In its order issued last week, the forum fined the builder Rs 5 lakhs and directed him and his firm to complete the pending works as per the agreement within the next 60 days and also arrange for the transfer documents and the completion certificate for the society.


RTI Act - Applicability to Cooperative Societies


 (ref. mail sent and reply recd. @yahoo mail)

Oct 10
 "THINK TANKS" - tending to dry up ?!
RBI is concerned over the increasing loan exposure in realty & infra sector

Urban Housing Mission to be named after Sardar Patel

State govt still haven’t formulated new housing policy

< All nothing but hollow/shallow talks, to the core, with no known follow-on action /wishful thinking so far ?!

<  Down the Memory Lane >
R.K. Narayan's 108th Birthday

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