The Maharashtra Legislative Assembly on Monday passed the Maharashtra Housing (Regulation and Development) Bill,2012,which seeks to set up what will be the countrys first realty industry regulator. While the Bill is expected to be passed in the Legislative Council during the ongoing session,the law will come into force only following the Presidents assent.
While the Presidents assent could take up to six months,the government of Maharashtra will,in the meantime,draft rules and work towards finalising candidates to be appointed as members of the body.
Maharashtra is the first state to enact this law. Its a game changer Bill, said Minister of State for Housing Sachin Ahir,after the passage of the Bill in the Lower House of Legislature. He said he hopes popular perception about the government and public representatives that they tend to favour developers would now change. This is in the interest of home buyer, Ahir said.
Proposing to safeguard the interest of home buyers and to usher in transparency in realty deals,the Bill foresees the setting up of a Housing Regulatory Authority and a Housing Appellate Tribunal. Not only does the law mandate full disclosure and compliance with all terms in sale agreements,but flat purchasers with any complaint can approach the regulatory authority. Following a hearing to both parties,the three-member authority will pass an order within three months.
According to the Bill,failure to comply with clauses in the law – including those pertaining to registering property details on the regulators website and giving possession of the flats as agreed upon – could lead to a penalty of Rs 10,000 per day of non-compliance or Rs 50 lakh,whichever is lower. Wilful non-compliance with the regulators orders could result in a penalty of Rs 10 lakh or imprisonment for up to three years,or both.
Introduced in the legislature during its budget session in March,the draft Bill was referred to a joint select committee,which submitted its report last week. We had received 4,000 to 4,500 suggestions to the Bill and the joint select committee went through all of these and introduced around 24 amendments, said Ahir,adding that the Maharashtra Ownership of Flats Act,1963,had laid down the law regarding various malpractices by builders but had not given citizens an effective implementing arm,now envisioned in the Maharashtra Housing (Regulation and Development) Bill.
Apart from listing various responsibilities of the developer including making full disclosure about the land and proposed development,abiding with all clauses in the sale agreement,obtaining occupation certificate,etc,the Bill also says developers cannot make alterations or additions in plans without the consent of the buyer,must take steps towards the formation of a cooperative society and execute the conveyance deed as agreed upon.
As per the revised Bill,no sale or transaction including marketing of a project can start until its details are displayed on the regulators website.
In a novel provision,the watchdog will not only ensure that flat purchasers are compensated for delayed or abandoned building projects but will also empower buyers to get together and appoint contractors and consultants to complete construction of such projects.
Government sources said the regulator could be set up in six months after recieveing Presidential assent,which means the body could be constituted only next year. The Bill will be introduced in the Upper House on Tuesday.