When a builder violates rules and flouts norms, who pays the price? The recent case of Campa Cola housing society in Mumbai shows it is the buyers who suffer the consequences.

Warning signs

When there are violations, usually you will find some warning signs. In the case of Campa Cola residents, Occupancy Certificate was not issued by the Bombay Municipal Corporation (BMC) when the buyers moved in around 1987. This usually happens when there are deviations from the approved plan.

“There are around 55,000 flats without an Occupancy Certificate in Mumbai,” says Ramesh Vaidayananthan, Managing Partner, Advaya Legal in Mumbai. In case of violations, the BMC has the right to demolish the building, he added. So insist on the Occupancy Certificate before taking possession.

Watch for violations

You may also identify violations early on. The Campa Cola building had large-scale deviations from the approved plan. For instance, 17 floors were built in one tower and 20 in another, as against the approval for five floors.

While this is a glaring divergence, some violations may be small and difficult to detect. Knowing what forms violations can take could help put you on guard. Common violations include consumption of excessive FSI, building being built higher than permitted, flouting of CRZ and air space regulations, projects built without environmental clearances and illegal utilisation of mandatory open spaces around buildings, notes Anuj Puri, Chairman and Country Head, Jones Lang LaSalle, India.

Know your builder

All this boils down to a one important rule. Do the due diligence on the builder and the project.

Scouting out your builder is necessary since violations are rather rampant. While the municipal authorities should be able to identify issues and rectify violations, builders mostly manage to get away. Legal records are not easily accessible, approval process not transparent and regulations loosely drafted.

“Developers try to squeeze the maximum area out of every project, as finding a rightly priced land with cooperative tenants is very complex and long drawn,” says Berinder Sahni, Director, Unicus Advisors, a Mumbai-based business consultancy firm.

But remember, no matter who is at fault — the builder or the authorities — you are the one who will end up with all the risks and liabilities.

Buyers’ recourse

You may have to bear the cost of disruption when there is a demolition. You could even be living in a structurally unsound building.

Due diligence is therefore mandatory before you enter into an agreement and at every stage of the process.

“Ignorance of the law is not an excuse,” says Vaidayananthan and adds that buyers may be able to sue the builders, if the agreement includes guarantees, such as title and approvals. Even if the agreement had excluded these, the builder can be taken to court for misrepresentation. According to Vaidayananthan, buyers can demand compensation to cover the cost of buying a new flat. Also, the municipal authorities can take legal action against the builder.

meera.siva@thehindu.co.in

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