Cabinet likely to discuss MOFA amendment soon

The three-member regulatory authority,headed by a person who has held the post of principal secretary,would act as a redressal body for home buyers. Three years ago,the State Cabinet had cleared the Maharashtra Housing Regulatory Commission Act,the draft of which was never placed before the state legislature for its final approval. The government later dropped the idea of a separate Act and decided to insert new provisions in the MOFA on the lines of the central government’s new Model Real Estate Act.

However,the amendment will remain silent on aspects such as fixing an upper limit on super built-up area,deciding on a percentage of low and middle income flats that a developer should construct in his project as also fixing the prices of such flats based on mandatory disclosure by developers about construction,land and other costs incurred by him. Officials said developers would only be required to mention the exact carpet area (net usable wall-to-wall area). This means that builders can continue to arbitrarily load the area of staircases,lobby,lift,sun decks or refuge area and sell flats on ‘super-built up area’,which is 35-100 per cent higher than the carpet area. “Developers will be required to mention the exact carpet area while selling a flat to a home buyer,” said the official.

Developers,however,said the new amendment is an exercise in consumer protection and does not pay any heed to their demand to streamline and speed up the approval process. “Though builders will have to provide bank guarantee on construction cost,the commission has no provision to facilitate them. There is a stigma of corruption attached to real estate after the recent spate of scams. Why can’t developers be allowed to regulate themselves through an independent body like architects and chartered accountants do?” said Lalit Kumar Jain chairman of Kumar builders and president,Confederation of Real Estate Developers’ Association.

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