MOFA Act 2025 faces criticism from housing and consumer rights activists

The MOFA Validation and Amendment Act 2025 has triggered strong opposition from housing and consumer rights activists who allege that the changes tilt the law in favour of developers while weakening protections for flat purchasersThe Bill passed during the recent winter session of the Maharashtra legislature is being criticised for diluting penalties under the Maharashtra Ownership of Flats Act MOFA Activists argue that the amendment restricts magistratesrsquo powers excludes RERAregistered projects from MOFArsquos purview and effectively removes criminal remedies that flat buyers and housing societies previously relied on including in redevelopment projectsCritics also allege that the amendment was pushed through without adequate consultation or debate and dismantles a 72yearold legal deterrent that ensured accountability in Maharashtrarsquos real estate sectormidday had earlier reported the governmentrsquos intent to amend the MOFA and published a series of stories on the issue In an article titled lsquoMaharashtra Debate over MOFA repeal reignites amid builderhousing clashrsquo dated November 27 the paper highlighted how builders were pushing for repeal citing the Real Estate Regulation Act while housing federations warned that such a move could harm flat owners and affect more than two lakh apartment unitsBlow to flat buyersAdvocate Godfrey Pimenta who has represented flat purchasers in several MOFA cases said the amendment substantially weakens enforcementldquoThe amendment significantly dilutes the magistratersquos powers to impose sentences on erring developers This is clearly a developerfriendly policy decision taken at the cost of flat purchasersrsquo rightsrdquo Pimenta saidHe added that earlier MOFA acted as a real deterrent against serious violations such as failure to execute agreements for sale delays in handing over possession diversion of funds and other statutory breachesldquoThe threat of criminal prosecution before a magistrate created fear and accountability among developers With the present amendment this powerful remedy has been effectively taken away Instead of strengthening consumer protection the State has weakened the enforcement mechanismrdquo he saidPimenta pointed out that there is no equivalent provision under RERA that allows flat buyers or societies to initiate criminal prosecution for such violations ldquoMany societies and buyers had approached magistrate courts under MOFA The penal provisions acted as a meaningful deterrentrdquo he addedlsquoMOFA safeguards weakenedrsquoCA Ramesh Prabhu founder chairman of the Maharashtra Societies Welfare Association MahaSEWA said the manner in which the amendment was passed was deeply concerningldquoThe draft amendments were never circulated for stakeholder consultation nor was the Bill debated in the Assembly By making MOFA inapplicable to RERAregistered projects the government has diluted wellestablished legal protections available to flat purchasersrdquo Prabhu saidHe noted that under Section 13 of MOFA serious defaults such as failure to hand over flats on time nonformation of societies nondisclosure of accounts and nonconveyance of land and buildings are treated as criminal offences allowing FIRs against defaulting developersldquoRERA does not cover redevelopment projects whereas MOFA protected existing members and societies Although redevelopment projects are registered under RERA for the sale component removing MOFA now deprives existing members of even this limited protectionrdquo he saidPrabhu pointed out that over the past decade around 500 builders have been booked under MOFA out of more than 50000 developers in Maharashtra ldquoFor 72 years MOFA has acted as a bulwark against criminal activity in real estate Honest builders had nothing to fear This move appears to protect criminal elements in the sectorrdquo he allegedMixed signalsAdvocate Shreeprasad Parab expert director at the State Housing Federation said the amendment sent mixed signalsldquoThe decision to retain and strengthen MOFA through the December 2025 amendment is welcome and reaffirms its role as a vital social welfare lawrdquo Parab said referring to strengthened provisions on deemed conveyanceHe added that extending deemed conveyance to societies formed under RERAregistered projects removes ambiguity and curbs misuse by promoters who delay transferring land and building titlesHowever Parab expressed concern over the dilution of criminal liability under Section 13 of MOFA ldquoEven if rarely enforced criminal provisions acted as a strong deterrent Weakening this accountability risks reducing hardwon rights of housing societies to mere paper protectionsrdquo he saidIn favourOffering a contrasting view Pankaj Kapoor of Liases Foras said RERA had already brought sufficient accountabilityldquoAcross states including Uttar Pradesh and Delhi developers were effectively regulated only after RERA came into force There is merit in moving towards one unified regulatory regime With RERA now established overlapping older provisions should ideally have been repealed in favour of a single effective statuterdquo Kapoor said