Maharashtra Housing Act 2012 Severely Hinders Real Estate Bill 2013
The Maharashtra Housing Act 2012 was well received in the mainstream media ever since it was passed. It’s commendable that Maharashtra took this initiative, but what’s important to understand is that this Act has provisions that negatively impact home buyers and promote developers’ interests.
What’s more, the State Act limits, and in many cases negates the many provisions of the Real Estate (Regulation and Development) Bill 2013, whose only aim is to reform the residential real estate sector.
The Central Bill Aims at Reform
The Real Estate Bill 2013 targets the anti-consumer practices that are prevalent in the real estate sector. It looks to protect the buyers from effects caused by the furtive practices of the developers, such as developing a project without seeking the necessary approvals. It also fights against the one-sided contracts heavily favoring the developers.
The central bill looks to infuse transparency in the system and protect the rights of the buyers.
The State Act Lets Developers Off the Hook And Penalizes Buyers
Maharashtra Housing Act 2012 instead promotes developers’ interests. For instance, developers can still sell apartments/properties without approval from development authorities. And if a developer fails to register with a regulatory authority, all it takes is a small fine of Rs 1000 per day.
The State Act also permits developers to collect 20% of the unit cost without a written agreement. There’s no certainty for the buyer if this amount will be returned in case of problems. The central bill allows the developer to collect only 10% as the booking amount, which is in line with the current industry practice.
Some very harsh provisions are also imposed on homebuyers if certain obligations under the law aren’t met. In some cases, homebuyers have been asked to bear the higher part of the penalty making it seem like they’re the ones who are being regulated.
The Act hasn’t even heeded to the demands of the developer community, especially for the creation of a single window system for approvals.
This law should be repealed if the state government cares for the interests of the homebuyers. The buyers would much rather wait for the central bill to be passed rather than bind themselves to this document that regulates them.
Source: Economic & Political Weekly
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