Maharashtra Govt Introduces Bill to Protect Flat Owners Under RERA

Nagpur: In a significant move aimed at protecting the interests of flat owners and housing societies and curbing malpractices by developers who withhold property titles, the Maharashtra government has proposed a key amendment to the decades-old Maharashtra Ownership Flats (Regulation of the promotion of construction, sale, management and transfer) Act, 1963 (MOFA).

The proposed amendment is designed to address a major legal lacuna concerning conveyance deeds for newer residential projects registered under the Real Estate (Regulation and Development) Act (RERA), 2016. The bill to amend The Maharashtra Ownership Flats (Regulation of the promotion of construction, Sale Management and Transfer) Act, 1963 was tabled on Friday by the Minister of State for Housing, Pankaj Bhoyar. The bill is expected to be discussed on Saturday.

The core of the proposed amendment is to introduce the provision of 'deemed conveyance' for housing projects that fall under the purview of RERA. The bill aims to address several loopholes. Currently, buildings constructed after RERA came into force in 2016 are not explicitly covered under MOFA's provision for deemed conveyance. This lack of protection has left many societies and flat owners struggling to gain legal ownership of the land from developers who delay or fail to execute the conveyance deed.

The bill proposes to strengthen flat owners’ rights. Deemed conveyance is a legal process under which a housing society can obtain the conveyance of the land's title directly from a competent authority when the promoter (builder/developer) fails to hand it over within the legally stipulated timeframe (typically three months of forming the society or obtaining the Occupation Certificate).

Since RERA is a Central Act, the state government cannot directly amend its provisions. Therefore, the state is utilising the existing MOFA framework to bring RERA-registered properties under the ambit of deemed conveyance, ensuring the protection of flat buyers, said the bill. According to the housing department, the MOFA, 1963, has long been the principal legislation in Maharashtra regulating the construction and sale of flats.

While it contains provisions for criminal action against errant developers and the crucial 'deemed conveyance' mechanism, the introduction of RERA created an overlap where newer projects were left without MOFA's specific protections for obtaining land ownership. 'RERA does not contain a provision explicitly mandating developers to hand over the conveyance deed within a specific short timeframe post-Occupation Certificate (OC), which is essential for societies to assume full control and management of their property,' it said.