Hi Experts,

There are many small builders selling independent flats in a G + 2 setup near Dhakoli. What is the authenticity of such flats? Is selling flats in G+2 legal there? Do you see any catch/flaw as i have heard that selling independent flats on a G+2 is not allowed anymore. Can you guys please provide your inputs on the same.

What all documents one need to verify ? How to verify property is legal, map is approved and independent floor registry allowed, builder has no loan / no stakeholders / loan approval for such property. Any pointers for trustworthy legal advisor in the area, would be really helpful.

Many Thanks,
Vishal.
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  • Experts/Seniors,
    Please provide your inputs on how i can verify if a builder can sell independent floors?
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  • I'm a also a first time buyer looking for the same answers. Have you bought a flat or still looking.
    CommentQuote
  • Though I already own an apartment but I am curious to know too, great question.
    CommentQuote
  • Originally Posted by IamSharma
    Though I already own an apartment but I am curious to know too, great question.


    Rightly said there. It is really a great question though not answered yet. Hey, I just went through the forum and saw that they have a legal adivsor now. I guess this query should be raised in that forum or move this thread there.

    Any moderators there? Some help!
    Thankkkkssss....
    CommentQuote
  • Legal_Guy; Can you help IamSharma; pyrosk; and ashianahunt; ?
    CommentQuote
  • Originally Posted by ashianahunt
    Hi Experts,

    There are many small builders selling independent flats in a G + 2 setup near Dhakoli. What is the authenticity of such flats? Is selling flats in G+2 legal there? Do you see any catch/flaw as i have heard that selling independent flats on a G+2 is not allowed anymore. Can you guys please provide your inputs on the same.

    What all documents one need to verify ? How to verify property is legal, map is approved and independent floor registry allowed, builder has no loan / no stakeholders / loan approval for such property. Any pointers for trustworthy legal advisor in the area, would be really helpful.

    Many Thanks,
    Vishal.


    Dear ashianahunt;

    For first part of question: Please specify the State he/she is in and the State and Municipality laws under which the property falls.
    All constructions by Builders should be preceded by various Licences, Approvals, and Permission Certificates. Following Proposals plans and certificates are required for a Builder to start construction or Offer for Agreement to sell:
    PROPOSAL / LETTER OF INTENT (LOI): submitted by builder to licensing authority e.g. MCGM’s Building Proposal Department, or MMRDA.
    INTIMATION OF DISAPPROVAL / INTIMATION OF APPROVAL (IOD/IOA) given to builder by the Licensing Authority. Legal conditions that the builder must fulfil are mentioned in this document.
    NO-OBJECTION-CERTIFICATES (NOCS). NOCs specified in IOD/IOA must be produced by the builder. These NOC are from Police, Municipality, Fire Department, etc. and submitted to the licensing authority.
    COMMENCEMENT CERTIFICATE (CC) is provided to builder from licensing authority after the conditions of IOD/IOA are fulfilled. CC authorizes the builder to commence excavation and foundation work. He can build up to plinth without approvals.
    APPROVED PLAN LAYOUTS. The plan layouts submitted by the builder provided by architect are examined by the licensing authority. After required changes it is approved.
    AMENDMENTS TO APPROVED PLAN LAYOUTS. The builders submit amendments after plans are approved, and they do add extra floors to the already submitted layout plans.
    a) Complete chain of title documents. E.g. Land transfers and owners, with all papers including registered agreements, stamp-duty payments, inheritance etc., advertisements and gazette announcements etc.
    b) Complete revenue records of land,
    c) Conversion details E.g. agricultural to non-agricultural, de-notification of industrial, goshala, Highway, SC/ST Land etc.
    d) City Survey Plan indicating the boundaries of the plots
    e) Will – if inheritance shown.
    f) If there was any dispute about ownership at any point (i.e. present owner or previous owners, then copies of the final court judgment.
    g) Mortgage Deed - to any bank or financial institution, and complete paper-work regarding same relinquishing the lien in favour of owner/builder.
    h) If land was leased by the government, then lease agreement and receipts of lease rent payments
    i) Registered agreement between the builder / promoter and the land-owner. (Joint-Venture/JV Agreement)


    If the land title is not with the Builder or was not with the previous owners, then legal problems can arise for currently sanctioned property. No purchaser can be indemnified against faulty title.

    IV. COMPLETE PAPERS OF THE BUILDER’S COMPANY/TRUST/FIRM/PARTNERSHIP i.e. Memorandum of Partnership, Memorandum of Association, Audited Annual Reports of all previous years etc.
    REASON FOR THIS: Depending on the form of ownership and the relationships involved, you – the flat-buyer – will have to bear various invisible risks. Examples:
    a) If the builder is not an individual i.e. but part of a partnership firm, then in case of a dispute between partners, your project may get stuck.
    b) If the builder (the individual you are dealing with) is director or employee of a private limited company of builders, then you need to know the legal powers of that individual. For example, you are at risk if he is signing papers that he is not legally authorized to sign; if so, all documents signed by him are of doubtful legal value for enforcing your rights in a court.

    V. Miscellaneous Checks suggested - Details Of Your Builder’s Debt-Equity Ratio and Other Projects Risk-Factors i.e. other construction projects, speculative investments in stocks and commodities, etc. REASON: If your builder is taking heavy financial risks on other fronts, then failure on those fronts may make him unable to complete your building. Checks: a) Builders working capital, b) Any large borrowings from private lenders. Then interest burden rises to crushing levels, and he not complete your project.
    b) Any Forex / speculative investments of Builder.
    c) Any other illegal activities of Builder- leading to arrests, IT raid or Economic offence Wing raids.
    d) Is your builder a record criminal, or defaulter?
    f) If the builder a first-timer / small-timer?
    a) Complete chain of title documents. E.g. Land transfers and owners, with all papers including registered agreements, stamp-duty payments, inheritance etc., advertisements and gazette announcements etc.
    b) Complete revenue records of land,
    c) Conversion details E.g. agricultural to non-agricultural, de-notification of industrial, goshala, Highway, SC/ST Land etc.
    d) City Survey Plan indicating the boundaries of the plots
    e) Will – if inheritance shown.
    f) If there was any dispute about ownership at any point (i.e. present owner or previous owners, then copies of the final court judgment.
    g) Mortgage Deed - to any bank or financial institution, and complete paper-work regarding same relinquishing the lien in favour of owner/builder.
    h) If land was leased by the government, then lease agreement and receipts of lease rent payments
    i) Registered agreement between the builder / promoter and the land-owner. (Joint-Venture/JV Agreement)


    If the land title is not with the Builder or was not with the previous owners, then legal problems can arise for currently sanctioned property. No purchaser can be indemnified against faulty title.

    IV. COMPLETE PAPERS OF THE BUILDER’S COMPANY/TRUST/FIRM/PARTNERSHIP i.e. Memorandum of Partnership, Memorandum of Association, Audited Annual Reports of all previous years etc.
    REASON FOR THIS: Depending on the form of ownership and the relationships involved, you – the flat-buyer – will have to bear various invisible risks. Examples:
    a) If the builder is not an individual i.e. but part of a partnership firm, then in case of a dispute between partners, your project may get stuck.
    b) If the builder (the individual you are dealing with) is director or employee of a private limited company of builders, then you need to know the legal powers of that individual. For example, you are at risk if he is signing papers that he is not legally authorized to sign; if so, all documents signed by him are of doubtful legal value for enforcing your rights in a court.

    V. Miscellaneous Checks suggested - Details Of Your Builder’s Debt-Equity Ratio and Other Projects Risk-Factors i.e. other construction projects, speculative investments in stocks and commodities, etc. REASON: If your builder is taking heavy financial risks on other fronts, then failure on those fronts may make him unable to complete your building. Checks: a) Builders working capital, b) Any large borrowings from private lenders. Then interest burden rises to crushing levels, and he not complete your project.
    b) Any Forex / speculative investments of Builder.
    c) Any other illegal activities of Builder- leading to arrests, IT raid or Economic offence Wing raids.
    d) Is your builder a record criminal, or defaulter?
    f) If the builder a first-timer / small-timer?
    a) Complete chain of title documents. E.g. Land transfers and owners, with all papers including registered agreements, stamp-duty payments, inheritance etc., advertisements and gazette announcements etc.
    b) Complete revenue records of land,
    c) Conversion details E.g. agricultural to non-agricultural, de-notification of industrial, goshala, Highway, SC/ST Land etc.
    d) City Survey Plan indicating the boundaries of the plots
    e) Will – if inheritance shown.
    f) If there was any dispute about ownership at any point (i.e. present owner or previous owners, then copies of the final court judgment.
    g) Mortgage Deed - to any bank or financial institution, and complete paper-work regarding same relinquishing the lien in favour of owner/builder.
    h) If land was leased by the government, then lease agreement and receipts of lease rent payments
    i) Registered agreement between the builder / promoter and the land-owner. (Joint-Venture/JV Agreement)


    If the land title is not with the Builder or was not with the previous owners, then legal problems can arise for currently sanctioned property. No purchaser can be indemnified against faulty title.

    IV. COMPLETE PAPERS OF THE BUILDER’S COMPANY/TRUST/FIRM/PARTNERSHIP i.e. Memorandum of Partnership, Memorandum of Association, Audited Annual Reports of all previous years etc.
    REASON FOR THIS: Depending on the form of ownership and the relationships involved, you – the flat-buyer – will have to bear various invisible risks. Examples:
    a) If the builder is not an individual i.e. but part of a partnership firm, then in case of a dispute between partners, your project may get stuck.
    b) If the builder (the individual you are dealing with) is director or employee of a private limited company of builders, then you need to know the legal powers of that individual. For example, you are at risk if he is signing papers that he is not legally authorized to sign; if so, all documents signed by him are of doubtful legal value for enforcing your rights in a court.

    V. Miscellaneous Checks suggested - Details Of Your Builder’s Debt-Equity Ratio and Other Projects Risk-Factors i.e. other construction projects, speculative investments in stocks and commodities, etc. REASON: If your builder is taking heavy financial risks on other fronts, then failure on those fronts may make him unable to complete your building. Checks: a) Builders working capital, b) Any large borrowings from private lenders. Then interest burden rises to crushing levels, and he not complete your project.
    b) Any Forex / speculative investments of Builder.
    c) Any other illegal activities of Builder- leading to arrests, IT raid or Economic offence Wing raids.
    d) Is your builder a record criminal, or defaulter?
    f) If the builder a first-timer / small-timer?
    a) Complete chain of title documents. E.g. Land transfers and owners, with all papers including registered agreements, stamp-duty payments, inheritance etc., advertisements and gazette announcements etc.
    b) Complete revenue records of land,
    c) Conversion details E.g. agricultural to non-agricultural, de-notification of industrial, goshala, Highway, SC/ST Land etc.
    d) City Survey Plan indicating the boundaries of the plots
    e) Will – if inheritance shown.
    f) If there was any dispute about ownership at any point (i.e. present owner or previous owners, then copies of the final court judgment.
    g) Mortgage Deed - to any bank or financial institution, and complete paper-work regarding same relinquishing the lien in favour of owner/builder.
    h) If land was leased by the government, then lease agreement and receipts of lease rent payments
    i) Registered agreement between the builder / promoter and the land-owner. (Joint-Venture/JV Agreement)


    If the land title is not with the Builder or was not with the previous owners, then legal problems can arise for currently sanctioned property. No purchaser can be indemnified against faulty title.

    IV. COMPLETE PAPERS OF THE BUILDER’S COMPANY/TRUST/FIRM/PARTNERSHIP i.e. Memorandum of Partnership, Memorandum of Association, Audited Annual Reports of all previous years etc.
    REASON FOR THIS: Depending on the form of ownership and the relationships involved, you – the flat-buyer – will have to bear various invisible risks. Examples:
    a) If the builder is not an individual i.e. but part of a partnership firm, then in case of a dispute between partners, your project may get stuck.
    b) If the builder (the individual you are dealing with) is director or employee of a private limited company of builders, then you need to know the legal powers of that individual. For example, you are at risk if he is signing papers that he is not legally authorized to sign; if so, all documents signed by him are of doubtful legal value for enforcing your rights in a court.

    V. Miscellaneous Checks suggested - Details Of Your Builder’s Debt-Equity Ratio and Other Projects Risk-Factors i.e. other construction projects, speculative investments in stocks and commodities, etc. REASON: If your builder is taking heavy financial risks on other fronts, then failure on those fronts may make him unable to complete your building. Checks: a) Builders working capital, b) Any large borrowings from private lenders. Then interest burden rises to crushing levels, and he not complete your project.
    b) Any Forex / speculative investments of Builder.
    c) Any other illegal activities of Builder- leading to arrests, IT raid or Economic offence Wing raids.
    d) Is your builder a record criminal, or defaulter?
    f) If the builder a first-timer / small-timer?
    CommentQuote