Legal experts say the onus is on flat buyers to check all aspects before investing in a real estate project, as agency does not verify any details
Ramesh Prabhu, chartered accountant and Avinash Pawar, MahaRERA Bar Association
BUYERS, beware! The MahaRERA registration of a real estate project is no guarantee that it will be completed within a stipulated time period. Moreover, legal experts say, the onus is on flat buyers to check all aspects before investing money in such projects, as MahaRERA does not verify details submitted by developers. This beats the very purpose for which RERA was formed — to bring transparency in the real estate industry and to ensure people's interest gets protected.
ADVERTISEMENT
Advocate Nilesh Gala, who has handled cases related to MahaRERA since its formation, said, "The RERA Act was brought into force in Maharashtra to ensure that all real estate projects had proper approvals, titles, and that the funds received for the project would be utilised only for construction-related activities. The Act was to protect larger interest of flat buyers, as it was presumed a RERA registered project would be free from all encumbrances and have clear marketable titles."
Also Read: Mumbai: Thousands of MahaRERA recovery orders pending
"However, it has been observed from numerous orders of MahaRERA, that flat buyers need to beware, and must do all due diligence before investing their hard-earned money in any upcoming project, even if it is registered under MahaRERA," he added. "As per section 4 of RERA many documents related to title of the land, building sanctions, approved plans, background of the promoter, etc. must be submitted to get its registration. Once a project is registered with RERA, the prospective purchasers consider the project is perfect, and book a flat in it. The unfortunate part is that RERA, believing the promoter, registers it based on the documents submitted. It is high time that RERA devises a system to verify all documents and only thereafter registers projects," said chartered accountant Ramesh Prabhu, who is also founder chairman of MahaSEWA.
'Developer's credentials?'
Prabhu has a word of caution for flat buyers, "Flat buyers should not merely go with the MahaRERA registration number, but check the credentials of the developers/promoters. Also, they should re-verify the uploaded documents, including proposed building plans on the MahaRERA website given by the developer, from municipal bodies and the Collector office. The commencement certificate of the project and the proposed flat/ floor need to be verified thoroughly, as MahaRERA grants the registration number for the project, even if the commencement certificate is pending for the floors above plinth level. Buyers must ensure the developer has commencement and completion certificates from the local bodies for every floor above the plinth level. A site visit to check work progress should be done," he added.
Wrong impression
Advocate Gala further said, "In the past three years, it has been observed in numerous MahaRERA orders that the regulatory body seldom does any verification of documents submitted by the promoters of upcoming projects, before they are uploaded on MahaRERA website. This gives the wrong impression to flat buyers, that the project is cleared of all legal compliances, and they confidently invest their money in it."
Also Read: Mumbai: MahaRERA order on Bombay Realty finally out
Gala also pointed out that MahaRERA does not keep track of the project completion period as per the time line submitted by promoters. He also claimed that some developers' registration validity has lapsed, and MahaRERA has not taken cognizance of the same. He added, "I have come across few cases, where there was no audit or checking of 70 per cent of the escrow bank account (an account related to real estate transactions), which is mandatory to be operated only for registered project construction activity. Funds are being reused for other activities which is allegedly not being objected to by MahaRERA."
Advocate Godfrey Pimenta who also practices in MahaRERA, said, "A project is underway at Marol Maroshi BEST depot, where it was revealed through RTI that the developer does not have rights to develop the property. When this was pointed out to MahaRERA, no action was taken. In such cases the purchasers are at risk."
Advocate Avinash Pawar, Vice President of MahaRERA Bar Association, said, "The builder's/ developer's submission to MahaRERA need not be believed by flat buyers, because the probability of falsified documents getting uploaded on its website cannot be ruled out. In other words, the promoters are believed to have uploaded genuine documents, until otherwise proved. This means the buyers need to challenge the discrepancies, if any, found on the MahaRERA website. Mere RERA registration of a project doesn't mean that it is free from any encumbrances."
Keep scrolling to read more news
Catch up on all the latest Mumbai news, crime news, current affairs, and a complete guide from food to things to do and events across Mumbai. Also download the new mid-day Android and iOS apps to get latest updates.
Mid-Day is now on Telegram. Click here to join our channel (@middayinfomedialtd) and stay updated with the latest news
Subscribe today by clicking the link and stay updated with the latest news!" Click here!
