Moneylife Foundation urges Maharashtra governor not to pass new Housing Bill

Over 200 activists and citizens present at the Moneylife Foundation seminar unanimously resolved to send a letter to the Maharashtra governor urging him not to sign on the new Housing Bill

Over 200 activists and citizens, present at the seminar, have unanimously resolved that Moneylife Foundation will write a letter to Maharashtra governor K Shankarnarayanan, urging him not to sign on the new Maharashtra Housing (Regulation and Development) Bill, 2012.


After listening to Pankaj Kapoor, founder and managing director, Liases Foras and Advocate Vinod Sampat, two prominent and bold voices in real estate, the audience at the Moneylife Foundation seminar, felt that the new Bill would fail to protect home buyers and housing societies while giving undue benefits to the builders.


On 16th July, the Maharashtra Legislative Assembly cleared the Housing (Regulation and Development) Bill, 2012, which aims to regulate and promote construction, sale, management and transfer of flats on ownership basis and to establish the Housing Regulatory Authority (HRA) and Housing Appellate Tribunal (HRT).


Terming the new Bill as in “200% in favour of builders”, Adv Sampat said, “Section 11 (1) of the new Bill, gives blanket power to builder to pay 15% penalty and cancel the contract. But it does not mention the time frame. How can a poor flat purchaser fight a mighty builder to get his money back with interest? Also there is no mention of refunds for stamp duty, registration expenses, VAT, Service Tax and Works Contract Tax. Does this means that the buyer will have to bear all these expenses?”



“I am surprised, that there is no liability (here it should be criminal liability) on the builder for constructing the building on time in the new Bill. Under Section 16, the builder is left scot free even if he does not comply with his statutory obligations like Building Completion Certificate (BCC),” Adv Sampat pointed out.


In the new Housing Bill, the builders are allowed to sell parking spaces under Section 2(s) (r). However, Adv Sampat pointed out that according to a judgement by the Supreme Court (Nahalchand Laloochand Pvt Ltd vs Panchali CHS Ltd), it is crystal clear that builder has no right to sell stilt or open space parking.



In its judgement, the apex court had said: "In our opinion, MOFA does restrict the rights of the promoter in the block or building constructed for flats or to be constructed for flats to which that Act applies. The promoter has no right to sell any portion of such building which is not `flat' within the meaning of Section 2(a-1) and the entire land and building has to be conveyed to the organisation; the only right remains with the promoter is to sell unsold flats. It is, thus, clear that the promoter has no right to sell `stilt parking spaces' as these are neither `flat' nor appurtenant or attachment to a `flat'."


Speaking at the seminar, Mr Kapoor said, “A lot of money in the real estate sector was brought in under the pretext of creating affordable housing. But this money has only increased speculation due to which land prices have gone up and this created an asset bubble. Developers do not want to cut down on their profits, investors want their own share of the cake and at the end of it the consumer has to bear the brunt by paying higher prices.”


Earlier, several activists, led by the Mumbai Grahak Panchayat (MGP), have also urged the Maharashtra governor to return the new Housing Bill to the Legislature for reconsideration. Advocate Shirish Deshpande, chairman, MGP, said various provisions of the new Housing Bill would take away the rights and benefits that are available to buyers and housing societies under the earlier Maharashtra Ownership Flats (Regulation of the Promotion, Construction, Sale, Management and Transfer) Act, 1963 (MOFA).




5 years ago

rReal estate is the biggest source of Black Money.. honest people are crying for buy home... P. Chidambram 3 weeks back told builders to reduce prices but then after 2 weeks told banks to lend more to real estate...real estate prices are more than NY even in tier2 cities... if any govt admin passes building proposal in Pune, Mumbai they make sure 1 flat is put on their name.. No regulation till now as politicians don't want that..

A call for SEBI and RBI functionaries to declare assets publicly

The former Secretary calls for senior functionaries at SEBI and RBI to make public disclosure of their salaries and an annual declaration of their assets, in accordance with the spirit of Article 19 of the constitution which confers on the citizen the right to know about various public authorities

EAS Sarma, a highly respected former Secretary, Government of India (Expenditure and Power) has written the Finance Ministry calling for greater transparency and public accountability in the finance sector to enhance the credibility of the statutory institutions that have a bearing on the day-to-day lives of the people.
In a letter to Arvind Mayaram, Secretary, Department of Economic Affairs in the Finance Ministry (who deals with these regulatory institutions), Mr Sarma has said, "As the first step towards this, it is imperative that the senior functionaries in these institutions not only make a public disclosure of their salaries etc., but also an annual declaration of their assets. This will be consistent with the spirit of Article 19 of the Constitution that confers on the citizen the right to know about the various public authorities. It will be in conformity with the public disclosure requirement under Section 4 of the Right to Information Act, 2005.
In particular, SEBI's primary function is to protect the interests of the investors by promoting transparency and public accountability of the various entities that form part of the capital market. It is therefore necessary that the Chairman and the members of SEBI set an example by making annual public disclosure of their assets for the investors to see. I am afraid that they have not complied with this.
It is ironic that the Prime Minister of this country along with his colleagues in the Cabinet, including the Finance Minister, should annually disclose their assets, whereas the public functionaries like Chairman, SEBI who are there to enhance transparency should refrain from following such a healthy practice. In fact, the Prime Minister was gracious enough to have personally telephoned me to confirm this fact that he and his colleagues have resolved to disclose their assets annually and have adopted it as mandatory practice!
I request you, as the Secretary in charge of Economic Affairs, to ensure that SEBI adopts this convention with immediate effect."
It may be recalled that Mr Sarma's repeated attempt to draw SEBI's attention to the issue of disclosures of oil reserves by Reliance Industries Ltd (RIL) has drawn a blank and his letters were mechanically forwarded to SEBI's mindlessly automated SCORES  system of grievance redressal.   


Rising wage bill

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