ET Article :

Can you sell your car parking slot?

There's nothing new about parking woes. Every day you hear about builders charging between Rs 1 lakh and Rs 15 lakh for a single parking slot along with their flats. Mumbai-based Vishwanath Sahu is among the lucky few on the other side of the fence. When he purchased a flat in the Gorai area of Malad six years ago, the developer offered to sell him a parking slot in addition to the space he was officially allowed to purchase, as there were no takers for it.

"The car park cost me around Rs 1 lakh, but since I had a motorcycle and a car, I thought it would be better to take two slots," says the 39-year-old cinematographer. Today, given the increasing number of car owners in his housing society, there is a shortage of parking space and Saha is keen to capitalise on it. "A member has offered me Rs 5 lakh to purchase my slot. I am planning to sell it, but don't know how to go about it," he adds.


Chances are that Saha will find it a legal nightmare to sell his slot, especially if someone challenges the transaction. This is because of the 2010 Supreme Court ruling, according to which flat buyers need not pay extra money to buy parking spaces, both open and closed, from property developers. The judgement, delivered by Justices RM Lodha and AK Patnaik, rejected real estate development company Nahalchand Laloochand's argument that they were entitled to sell garages/stilt parking areas as separate flats to owners who wanted to use it as a parking.

According to the ruling, "If a promoter does not fully disclose the common areas and facilities, he does so at his own peril. Stilt parking spaces will not cease to be part of common areas and facilities merely because the promoter has not described the same as such in the agreement with the flat purchaser. The promoter has no right to sell any portion of the building which is not a flat."

Ravi Goenka, advocate, Mumbai High Court, explains that though a developer cannot sell the car park to a person who purchases a flat from him, he can "allot the same on a first come, first served basis without charging any money from him". According to him, the housing society has to then take the responsibility for reshuffling the parking spaces to other members at periodic intervals. "The allotted space means that the member has the right only to park his vehicle. He is not the owner of the space and cannot sell it to others at a premium," says Goenka.

The housing society is allowed to frame its own parking rules. Most of them ask for a copy of the vehicle documents before allotting a parking slot. This is to restrict non-members from parking inside the society premises. The rule of thumb is that no member will be eligible for allotment of more than one stilt/covered parking space per flat. If any slots remain vacant for want of applicants, which is sometimes the case for open parking, a second parking space may be allotted to interested members. This procedure is supposed to be followed on an annual basis, provided the empty slots are not required by a member who is yet to bag even one designated parking space.

The bad news

Far from accepting the ruling and living by the book, developers in most cities are actually charging flat owners twice for the same parking space. "In most of the top metro cities, where transactions generally take into account the super built-up area (total area of land where the project is spread divided by the total number of flats), the parking area is also divided and added to it," says Ganesh Vasudevan, vice president of , a Chennai-based real estate portal. This means that the developer has charged flat buyers for the parking space even before possession. Despite having charged for the total land, the developer then sells parking slots at exorbitant rates.

Typically, car parking slots sell for Rs 1-3 lakh in mid-level housing projects and can go up to Rs 10 lakh in premium housing projects in the metro cities. According to Goenka, even if developers take extra money and sell the parking space to the buyer, they take utmost care not to mention it in the agreement as it is illegal and can be challenged in court.

New tricks of the trade

Given that selling parking spaces is a lucrative source of additional revenue for developers, they are trying hard not to forgo it. So they have come up with innovative ways to carry on business as usual. Says Subhankar Mitra, head, strategic consulting (west), Jones Lang LaSalle India: "If developers are restricted from selling slots directly, they find ways to apportion the cost, say, by increasing the charge for the super built-up area or by raising the overall per square foot rate. In other words, property buyers will continue to pay for parking either directly or indirectly."

According to him, many high-end transactions have been known to fall through due to the developer's inability to meet buyer requests for multiple parking slots with each flat. This problem has cropped up in areas such as Bandra, Nepean Sea Road, Peddar Road and the like in Mumbai. In the case of commercial property, the acceptable industry norm is to provide one parking slot per 1,000 sq ft. If a project provides more than this, it can command a premium price, claims Mitra.

The Supreme Court ruling ensures that even if you find a buyer for your parking slot, you won't be able to sell it. However, you may consider renting out the space if it is agreeable to the housing society. As yet, there are no tax implications on such rental income, but it will be better to check with a tax expert before doing so.


Source : Can you sell your car parking slot? Find out your legal rights - Economic Times
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  • Originally Posted by VikasOberoi
    Can I ask the builder to return the parking charges?

    Thanks


    Satya hermitage also asked for 4L (for 2 parking) at prelaunch but by the time of BBA, it got merged into BSP....

    I do not think we can get parking free from these chors ..... tail toh til se hee niklega...

    if not specific charge then BSP main jud jayega
    CommentQuote
  • Originally Posted by karan.singh
    Satya hermitage also asked for 4L (for 2 parking) at prelaunch but by the time of BBA, it got merged into BSP....

    I do not think we can get parking free from these chors ..... tail toh til se hee niklega...

    if not specific charge then BSP main jud jayega


    Hi
    Greetings

    For most builders it might be good business sense but for many with conscience (rare commodity) it is unethical as well as illegal and contravention of Honble supreme courts orders and against the undertakings given while obtaining licenses..

    If still builders feel that they want to charge, they will, in one form or the other to avoid legalities (WHICH ARE BOUND TO HAPPEN)

    Another big one is an increasing trend about STP CHARGES, SUBSTATION CHARGES, TERRACE CHARGES, being levied on buyers of apartments. Whats next to come.. Jogging track charges, Park sitting fees, Lift entry charges, Entry fee into GH for self and servants, etc etc.. :)

    High time we have a regulator to ensure that participants in RE market have some kind of peripheries sketched for their conduct.

    Cheers
    CommentQuote
  • Hi
    I think there is some legal loophole which these builders are using
    Else the so called / considered to be ethical Godrej also is charging parking for their new project. They call exclusive parking space. How do we get around this. We seriously need legal advicers on IREF

    Originally Posted by BlessU
    Hi
    Greetings

    For most builders it might be good business sense but for many with conscience (rare commodity) it is unethical as well as illegal and contravention of Honble supreme courts orders and against the undertakings given while obtaining licenses..

    If still builders feel that they want to charge, they will, in one form or the other to avoid legalities (WHICH ARE BOUND TO HAPPEN)

    Another big one is an increasing trend about STP CHARGES, SUBSTATION CHARGES, TERRACE CHARGES, being levied on buyers of apartments. Whats next to come.. Jogging track charges, Park sitting fees, Lift entry charges, Entry fee into GH for self and servants, etc etc.. :)

    High time we have a regulator to ensure that participants in RE market have some kind of peripheries sketched for their conduct.

    Cheers
    CommentQuote
  • Originally Posted by rahul40
    When I countered the builder with SC judgment dt 31-08-2010 about 'builder cant sale car parking', then gurgaon builder are saying that this for maharastra ownership flat act.. not applicable to haryana flat ownership act 1983..
    I agru with them that SC order is applicable in all india.
    SC means, its a law of land.

    when i give them haryana flat ownership act 1983, copy and draw their attention on section 3(1) and 3(f)(3) of haryana flat ownership act 1983, they keep silent.. because in this act i.e. haryana flat ownership act 1983 too, car parking comes under common area and car parking is part of apartment.

    when I sent then a RTI reply from DTCP, chandigarh saying that builder cant sale car parking slot..
    they are saying that didn't factored car parking in super area., so we increase the super area in your billing and you pay.. this they are saying after 1 year.. which they can say at this stage. this is what my argument.




    do u have any order / judgment of delhi high court or haryana/punjab hight court for this matter..


    also..

    what cases i can put on builder to get this done... i don't think consumer forum are fast in passing orders.

    can i file criminal complaint case to MM court, DELHI.. with criminal application.

    please reply



    I am literally trying to find legal opinion on this issue.
    All the builders including the so called ethical builders like Mahindra Aura, Godrej, Tata etc are charging for the parking... They call it as exclusive parking space...

    Want to find an answer a legal answer pls...

    Moderators and Veterans... pls help find an answer.
    CommentQuote
  • Rahul...
    I dont think so.... the answer is so straight..
    no builder and esp the big corporate companies does not want to charge for parking against the judgments... there is a loophole in the law which the builders are taking advantage of.
    CommentQuote
  • But what is the way out.. Every small or reputed builder is charging heavy sums for car parking and every one including investor or end user is paying for it.. :(

    karishna99: what is the loophole ??
    CommentQuote
  • Best of luck
    Rahul... its not about courage..n u dont want to know if i have or not...
    I want to understand the legality before I could go in and file a case.. there is no point in filing a case unless one is clear with facts...
    keep me posted on the legal opinion that you are seeking (pursuing)..
    CommentQuote
  • Rahul40, any update on your legal case that you claimed to be pursuing.
    CommentQuote
  • Originally Posted by rahul40
    When I countered the builder with SC judgment dt 31-08-2010 about 'builder cant sale car parking', then gurgaon builder are saying that this for maharastra ownership flat act.. not applicable to haryana flat ownership act 1983..
    I agru with them that SC order is applicable in all india.
    SC means, its a law of land.

    when i give them haryana flat ownership act 1983, copy and draw their attention on section 3(1) and 3(f)(3) of haryana flat ownership act 1983, they keep silent.. because in this act i.e. haryana flat ownership act 1983 too, car parking comes under common area and car parking is part of apartment.

    when I sent then a RTI reply from DTCP, chandigarh saying that builder cant sale car parking slot..
    they are saying that didn't factored car parking in super area., so we increase the super area in your billing and you pay.. this they are saying after 1 year.. which they can say at this stage. this is what my argument.



    do u have any order / judgment of delhi high court or haryana/punjab hight court for this matter..


    also..

    what cases i can put on builder to get this done... i don't think consumer forum are fast in passing orders.

    can i file criminal complaint case to MM court, DELHI.. with criminal application.

    please reply


    Discussion on this have been done before, the order says builder can't sell parking area to outside people like garage owners or just let outsiders park their vehicles for a fee. Read the whole jugdement and the case. The parking area is part of your apartment priced at a different rate.

    There had been cases in Mumbai where builders would start selling parking space to public in general so anybody could come and park their vehicles creating problems to the residents, or taxi services started parking there, or garage owners.
    CommentQuote
  • Refund of Parking

    A lot of us know parking can not be sold, Yet till date nothing has happened about it. I was glad to learn that finally something is happening on this front & a movement on refund of parking charges has been stared by an Non Profit organization FAOA India.

    I feel every real estate customer should join the movement & ask for refund from their builder. I have already done that from DLF.

    You can learn more about this movement from FAOA INDIA's facebook page.
    CommentQuote
  • Originally Posted by nbkp4gk
    A lot of us know parking can not be sold, Yet till date nothing has happened about it. I was glad to learn that finally something is happening on this front & a movement on refund of parking charges has been stared by an Non Profit organization FAOA India.

    I feel every real estate customer should join the movement & ask for refund from their builder. I have already done that from DLF.

    You can learn more about this movement from FAOA INDIA's facebook page.


    so dlf has returned your car parking charges ? which project ?
    CommentQuote
  • We have asked for refund for New Town Heights GHS, I know getting refund from DLF will not be easy but if one goes through BRIII which is building plan approval, Apartment Act & the SC judgement DLF needs to refund the money.

    I am also a lawyer (currently in a corporate Job) & a consumer rights activist. I believe that unless one asks for his rights he/ she will never get it.

    Regards

    Nitin
    CommentQuote
  • Good luck to you Nitin , Please share the link for others benefit.


    Please keep us updated on your Parking charges refund request with DLF
    CommentQuote
  • Originally Posted by nbkp4gk
    We have asked for refund for New Town Heights GHS, I know getting refund from DLF will not be easy but if one goes through BRIII which is building plan approval, Apartment Act & the SC judgement DLF needs to refund the money.

    I am also a lawyer (currently in a corporate Job) & a consumer rights activist. I believe that unless one asks for his rights he/ she will never get it.

    Regards

    Nitin


    Nitin,

    Welcome to IREF!!!

    This is an issue that should not be limited to just DLF and its properties. Almost all the builders in Gurgaon were using DLF like contracts and all RWA's in GGN need to get involved in asking for the money back for their apartment owners.

    This is the first balancing act in the Real Estate market. Hope we buyers get a louder voice over the years. Long hard fight still left ahead.
    CommentQuote
  • Hi Nitin,

    what is the process for asking parking refund from builder. can you please share the details and some documents to reference while raising it to builder. should we send email or registered post for same.
    CommentQuote