:) New Delhi: The Centre is coming up with a Bill which will make it tough for builders to short-change buyers on facilities and quality of construction. Government wants developers to deposit 25% of development cost in the form of a bank guarantee which will be enchased to check against buyers being duped by fly-by-night operators.
Also, the promoter cannot cancel the sale unilaterally. The draft provides for issuing notices besides giving buyers sufficient time to respond before cancellation. Money collected also has to be refunded and interest must be paid. To check against buyers facing excessive burden in case of defaults in payment, government intends to cap penalty for late clearance of dues at 1% of the cost of the house.
In the absence of regulations, some builders at present levy as much as 12-15% interest, which translates into over 100% a year on late payment. To ensure that a villa seen in ad is the same as what you will get, the proposed law intends to lay down a compensation mechanism in the licence to be issued by the proposed regulator.
Breach of terms could result in imprisonment of up to three years for the builder or a penalty of Rs 1 lakh, or both, the draft said. Promoters also have to disclose the nature of fixtures and fittings, amenities used for construction.
............I was just going throught this article and thought I should be shared.