Maharashtra govt should make MOFA even more stringent, says MahaRERA

After the State Housing Federation opposed the state governmentrsquos move to repeal the Maharashtra Ownership of Flats Act MOFA 1963 the Maharashtra Societies Welfare Association MahaSeWA Watchdog Foundation and MahaRERA Bar Association threatened to hold a widespread protest against any such arbitrary movemidday in its report lsquoThis policy change will affect 12 crore homeownersrsquo in its September 26 edition highlighted that the government was contemplating repealing the law which allows society to obtain ownership without developersrsquo interventionAlso read Maharashtra govt mulls repeal of MOFA fate of over 125L coop housing societies uncertainNearly 40 developers and their associations had opposed RERA in various high courts Representation picRamesh Prabhu chairman of MahaSEWA said ldquoAfter the implementation of the Real Estate Regulation and Development Act RERA and the Insolvency and Bankruptcy Code 2016 developers accused of wrongdoings have been required to defend themselves in light of additional legislation apart from the already existing MOFA and the Consumer Protection Act When RERA was implemented nearly 40 developers and their associations challenged it in different high courts The Supreme Court later directed the Bombay high court to decide the constitutional validity of RERA within two months and the latter upheld the law Realising that RERA would continue to regulate the real estate sector developers started to attempt to reduce the effect of other such lawsrdquoldquoFirst the builders approached the Supreme Court stating that complaints against them should not be heard by consumer courts But the apex court held that it is an additional remedy available to consumers Thus they failed to stop the proceedings against them under the Consumer Protection Act Similarly more than 100 builders approached the Supreme Court claiming that homebuyers cannot be considered financial creditors and cannot invoke provisions under the Insolvency and Bankruptcy Code against developers This case was also not decided in the buildersrsquo favourrdquo said PrabhulsquoNo need to repeal ActrsquoHe added that aggrieved consumers In Maharashtra are initiating criminal proceedings under MOFA and RERA against builders many of whom are now behind bars ldquoSimilarly many homebuyers approach RERA for interest and compensation for delayed possession formation of societies and violations etc Section 88 of RERA is very clear that the Act is in addition to other existing laws or any future laws Therefore the MOFA in no way needs to be repealed Repeal of MOFA will have a huge impact on various precedents established by the Supreme Court and the high court since 1963rdquo he saidGodfrey Pimenta Watchdog FoundationPrabhu stated that by repealing MOFA the competent authority established under Section 5A of MOFA to hear grievances will become redundant ldquoMore than 50 per cent of the 125 lakh registered cooperative housing societies in Maharashtra have not received conveyance from the builder for years together As per Section 11 of MOFA they will be able to approach the competent authority ie district deputy registrar and get the deemed conveyance of the land and building Since 2010 more than 10000 societies across the state could get conveyance which otherwise was not possiblerdquo he statedldquoBy repealing MOFA the injustice that will be done to crores of homebuyers is more than the relief that will be given to errant builders If the government attempts to protect the interests of a few errant builders the citizens of Maharashtra will revolt against itrdquo Prabhu saidAdvocate Godfrey Pimenta of the Watchdog Foundation said ldquoEven though the Real Estate Regulation and Development Act 2016 is a central act that aims to create a single regulatory framework for governing real estate in the country under section 88 of RERA the application of other laws is not barred The statersquos move to repeal MOFA will have farreaching consequences on the purchasers of the premises of real estate projects and criminal prosecution for the violation of various provisions of MOFA will come to end These provisions are a deterrent that the unscrupulous developers fear the most Civil proceedings do not matter much as the same get dragged for years with flat purchasers being at the receiving endrdquoHe added that there are not enough deterring provisions in RERA and that even though the law has penal provisions they are used sparingly against developers ldquoRepealing MOFA would be tantamount to snatching a valuable effective and deterrent remedy from aggrieved flat purchasersrdquo Pimenta saidJustice aspect of lawAnil DSouza Hon Secretary Bar Association of MahaRERA said apart from its importance for housing societies there was another huge aspect of MOFA ldquoThat is the access to the criminal side of adjudication ie the courts owing to the prevalence of Section 13 of the lawrdquo he saidDSouza has himself filed numerous complaints against developers in several police stations in Mumbai ldquoWe have also filed private complaints with metropolitan magistrate courts seeking direction for the police to register FIRs And the most important element is that we have seen resultsrdquo he saidldquoWe will appeal to the new government in Maharashtra to withdraw its letter asking for the repeal of MOFA Instead the government should amend MOFA to make it more stringent and powerfulrdquo he addedHow law empowers common manMOFA has provisions where developers can be prosecuted for not making full and true disclosures about all encumbrances on the land to be developed not disclosing fixtures fittings and amenities to be provided not specifying the date by which possession of the premises is to be delivered charging over and above the amount specified in the agreement nonformation of the society and nongrant of conveyance Pimenta said