Jargon used by Builders in Haryana.

Since a lot of builders are deficient in disclosing crucial facts about the property in launch of their projects and a lot of times fool the gullible Home-buyers with fancy jargon like Pre-launch, Launch, Super Area, FAR, Build-up Area, Covered Car Parking, Possession for Fit-outs etc. Therefore at each stage there is a term used by Builders which usually means almost opposite of what a common definition would  classify. Hence, we shall start to explore these definitions so that we are more aware of the facts rather then getting misled by false statements of the Brokers into buying something that does not exist. It is important that we start first with Pre-launch as that is the first jargon that we have to deal with when we look for projects on sale and as its understanding determines the extent to which the builder has achieved in terms of the development cycle of the project at the time of pre-launch.

PRE LAUNCH/ SOFT LAUNCH:
The Building bye laws governing licensed colonies in Haryana is regulated by the Haryana Development & Regulations of Urban Areas Act, 1975 and the rules framed there in. Section 7(i) of the Act of 1975, clearly prohibits the Builder to advertise and transfer plots, " without obtaining a license under section 3, transfer or agree to transfer in any manner plots in a colony or make an advertisement or receive any amount in respect thereof". Its true though that the administration has banned the pre-launch of projects but each project in haryana is pre-launched by the builder and every consumer tries to get into the project at the initial stage due to the attractive price tag at which the property is Pre-Launched. In common parlance we are told that Pre-Launched project is a project where certain formalities have yet not been completed but would be done within a few months and thereafter the project would be launched. What formalities have not been completed by the builder that we never get to know, whether the builder has the title of the land on which the project is being Pre-launched or not, has the builder got the license as per the Act of 1975 or not etc.

The factual matrix is that at the time we decide to enter into the property which is Pre-Launched/Soft-Launched there is no true information shared on any facts about the stage the project is in, what is shown is only a brochure which says all maps, drawings, etc are tentative and subject to change and many times even the customary brochure is also not prepared, it is the brokers presentation that we believe with open eyes. The builders in most of these cases do not even have the title of the land where they want the customers to believe the project is going to come. That is the reason the property is priced at much lower level to entice the gullible common man. It is only after the builder has sold considerable part of the project  to consumers that he pays the landowners with whom he had entered into an agreement to purchase the land. Most often, for various reasons the deal entered into by builder and landowner turns sour by the time the final payment has to be made by the builder to the landowner/s and innumerable times the builder is not able to get the whole continuous patch of land as planned. Here is where the delay starts, now the builder starts to hunt for land which could take him months and by the time he is able to get the total area needed for the project the zoning conditions do not allow the permission for grant of license as 20% of the sector land is already sanctioned as group housing to other builder. Therefore more delays and the reason for many a times the project being shifted from one area to another.

Where the title of the land is with the builder and pre-launch is announced, it is still safer but does not guarantee much. The fact that the license to develop and market the project is with him or not is still not clear. yes we can check the status of the license if granted to a colonizer as it is available online at http://tcpharyana.gov.in/ it is a welcome initiative by the Town & Country Planning Haryana to allow updated information to the citizens. The problem arises here is that 90% of the colonizers do not have license in their name but in their Subsidiaries name and it is difficult for the home buyer to ascertain which license is for his project. Therefore it is very essential that the Town & Country office mandates the Builders to only apply for license in the name on which it is selling the project. Till this is not done the home buyer would still be in lurch.

If the Builder has the title of the land and the license from Competent Authority, then it is a safer proposition for any Home-buyer. The next step is the approval of the layout plan of the colony, clearance from Ministry of Environment and Forest, building plan approval etc. which might take three to six months depending on the six of the project , height of the towers, location of the project etc.

The important question that troubles every Home-buyer is how to ascertain the above facts to make informed buying decision. Since the Housing industry is not self regulated it is very difficult to get the information from the Builder, very few Builders actually divulge the true information regarding the development cycle of the project at the Pre-Launch stage. The Authorities like the DTCP take months and months to give any information to the prospective consumers as the name of the builder for which information is sought does not match with the records of the subsidiary which is licensed. Therefore it is best advised not to go for Pre-launch offers, as they are tricky and risky proposition.  Most number of litigation pending in the consumer courts are of the Pre-launched projects only. If at all any consumer wishes to buy in Pre-launch then he/she should be prepared for longer gestation period of the project to actually take off, be careful of not paying more them 10% or 15% percent till all approvals are taken by the builder for the project and healthy follow-up on the latest status of the project with the builder and its agents. These few steps would mitigate any major loss to the Home-buyer.

HOW ERA DUPED THE HOME BUYERS OF REDWOOD RESIDENCY, FARIDABAD

This is the plan that was sanctioned by the DTCP Haryana on 19.07.2007 well after the allotment was made to the gullible Home-buyers who were already distressed by the shifting of the project from sec-88 to sector-78  Faridabad.

This is the plan that was placed on record at the time of allotment by the Era Management. Please see this plan shows only 8 towers vs the 9 towers in the sanctioned plan. This plan shows only one Tigaon road passing by on one side of the project vs the 24 meter road passing between the towers E,F,G ,H and the rest of the towers plus one 3.25 Mtrs road named Revenue road that cuts the project again before tower I. Further the Allotment plan shows a 4 acre park around which towers were to be constructed vs the sanction plan that does not anywhere show this park or land between towers to be integral part of the project. The Below tabled plan shows a huge Club and other facilities like creche,etc which are nowhere to be seen in the sanctioned plan, of course there is dedicated place for the club on one corner of the project but the size and accessibility to it is a big question mark now as it is not within the complex for either towers E,F,G,H and I. 

This is the Google Map of the construction status of the project. it is evidently clear that the project does not  have any green cover in their common/open spaces. where as the above mentioned plan clearly shows a lot of green/open spaces. Perusal of the Google Map also indicates that Era has till date after almost 7 years of booking of apartments neither completed the development and construction of the project nor has it created the promised (even sanctioned) facilities like the club, creche etc.

Therefore the Home Buyer is not only duped by the changes in the layout or the project site and other promises made during the booking of the flats but also by the delay in construction and development of the project by Era. The circle rates have gone up, the EDC has been Enhanced, the service tax has been levied , the super area has been increased without any proportional increase in the area of the flat or the project....which all have added to the burden of the Home-buyer who is pressed upon by the clauses of the bilateral agreement to pay all dues as demanded but the builder is not bound by any of its contractual Agreement and can and is continuously delaying the construction by inflicting monetary as well as emotional injury and harassment on the Home-buyers. Hope the regulator listens and takes urgent action otherwise citizens will be cheated blatantly even in the future by unscrupulous Real Estate Developers Like ERA LANDMARKS!!!

Complaint to Director General Haryana Against Mal-practices of ERA LANDMARKS

Director General, Town & Country Planning

Haryana, Sector-18, Madhya Marg,

Chandigarh, Haryana 160017.

Complaint for violation and contravention of  Section 7 (i) & (ii) of the Haryana Development and Regulations of Urban Areas Act, 1975 and the rules framed hereunder, by M/s ERA LANDMARKS (I) Ltd.

Most Respectfully Showeth:

The Present Complaint is filed to highlight the rampant abuse and violation of Laws, Bye-Laws, rules, Regulations and provisions of the state of Haryana by aforesaid builder in conspiracy with M/s BPTP who is the licensee of the said land in Sector-76, falling in the Urban Estate of Faridabad, vide License No. 1042 to 1061 of 2006. The present complaint’s endeavor is to bring to fore the illegal methods adopted by Licensee and M/s Era Landmarks to dupe thousands of gullible citizens with ponzi housing schemes which do not have any sanction of the competent Authority. Further, the complaint tries to show how the Licensee is cheating the Competent Authority by not truthfully disclosing and concealing material facts with regards to the provisions of the Rules of 1976.

1.      It is submitted that the Licensee M/s BPTP , Vide License No. 1042 to 1061 of 2006 was granted permission to set up Residential  Group Colony admeasuring  55.98 Acres in sector-76 falling under the Urban Estate of Faridabad.

2.      It is submitted that M/s BPTP executed an irrevocable General Power of Attorney in Favor of M/s ERA LANDMARKS (I) LTD., whereby  these two colonizers conspired to unlawfully confer the rights to construct, develop and market in its own name and brand a residential township on Approx 26 Acres of the licensed Colony. The following License’s have been stated to have been transferred in favor of Era Landmarks, License No. 1042, 1043, 1045, 1046, 1048, 1049, 1050, 1051, 1052, 1053, 1054, 1055 and 1061, through this unlawful instrument.

3.       it is known fact that Section 3(1)of the Haryana Development & Regulations of Urban Areas Act,1975, clearly states that, “ Any Owner desiring to convert his land into a colony shall, unless exempted under section 9, make an application to the Director, for the grant of a license to develop a colony in the prescribed form and pay for it  such fee and conversion charges as may be prescribed……”. Therefore to be a licensee the foremost requirement is to be owner of the said land that the owner wants to convert into a colony and thereafter Under subsection 2 of the said section needs to fulfill other mandatory requirements to allow the Director to grant license in his favor. Further, Section 7(i) of the Act of 1975 states that, “ Without Obtaining a license under section 3, transfer or agree to transfer in any manner plots in a colony or make advertisement or receive any amount in respect thereof is prohibited”. Therefore it is clear from the aforesaid that there is no provision under the Act of 1975 for M/s BPTP to confer rights to M/s Era Landmarks (i) Ltd. and further, M/s Era Landmarks (I) Ltd had and has no rights to transfer or agree to transfer plots in a colony, to advertise or to receive amounts thereof from intending allottees and the said bilateral irrevocable general power of Attorney is de facto and hence void and an unlawful instrument designed with motive to cheat the gullible common man of his lives saving.

4.      It is submitted that this unlawful activity between M/s BPTP and M/s ERA Landmarks (I) Ltd, to dupe thousands of gullible Citizens of the state has been brought to light to your good office through The DTP (Faridabad) vide Memo. No. 2560 dated 23.05.2013 and also through repeated letters send by, Investigating Officer ASI Suresh Chand, EOW ( Faridabad). It is regretted that even after more than several months the Officer is still waiting to know the stand of Director in this regard.

5.      It is stated that Era Landmarks (I) Ltd, does not hold any valid license to develop the said colony in sector 76 of Faridabad. Yet, with a brazen and blatant mala-fide intention M/s Era Landmarks (i) Ltd., has sold thousands of Ground Plus three floors and Highrise in 26 acres of licensed land of M/s BPTP. Copy of receipts of consumers of Era Landmarks is annexed and marked hereto as Annexure-1.  Perusal of the ledger summary clearly shows the date on which the first installment was collected by Era, the Number and address of the floor/flat sold and the total consideration for which it is sold. Therefore, there is no Iota of doubt that M/s Era Landmarks (i) Ltd., has intentionally and knowingly committed fraud with the citizens of the state by selling properties for which there is no sanctity of law.

6.      It is stated that M/s Era Landmarks (I) Ltd has sold this project showcasing the project as affordable option in Faridabad vide sales brochure, copy of which is annexed and marked Annexure-2.  Perusal of the brochure shows without doubt that M/s Era Landmark in facto is propagating and soliciting sales by enticing public at large with its affordable tag line and secured gated community features. The Brochure also clearly shows the layout plan of the residential colony, with parks and other facilities. Therefore it is clear that Era Landmarks has very indigenously designed in conspiracy with M/s BPTP a scheme to lure and dupe thousands of gullible citizens of the state.

7.      It is further submitted that Era Landmark has constructed the buildings/ structure of building and in some cases started construction of certain buildings within this project, pictures of the site of construction are annexed and marked hereto as Anneure-3. Its is stated fact that under section 7(ii), “ it is prohibited to erect or re erect any building in any colony in respect of which a licnese under section 3 has not been granted”. Therefore, M/s Era Landmarks (I) Ltd is selling and constructing illegally and further is jeopardizing the future and the present of thousand of citizens who do not know the modus operandi of Era and are faithfully abiding by the terms and condition of their bilateral agreement executed between Era and the allottees.

8.      It is submitted that Era Landmarks is committing gross violations that is causing serious harm and injury not only to the allottees who have bought into this ponzi residential scheme sold by Era landmarks (I) Ltd. to gain unlawfully at the expense of common man but  is also defrauding with the Competent authority, by constructing illegal and unauthorized building in the state and frustrating all efforts for proper and planned urban development in the state of Haryana.

9.      It is pertinent to mention that as the ownership of land is not in the name of M/s Era Landmarks which is selling and constructing the said residential project to public at large since 2009 and till date the allottees have almost paid 90% of the agreed sales consideration, further it also  does not have the mandatory license in its name. Therefore, the most important question arises that how would it be possible for M/s Era Landmarks to pass on the legal title and get conveyance deed executed in favor of these thousands of allottees and under which prevalent rule, law or Act would it be possible to allow creation of title of an unlawful and unauthorized construction. It thereby means that if stringent action is not taken immediately these thousands of allottees will have no option but to lose their lives saving.

Prayer:

 It is most humbly prayed through present complaint based on aforesaid circumstances and facts to grant reliefs in interest of Justice and in favor of the allottees.

1.      Hold the licensee guilty, jointly and severally, for criminal conspiracy and forging papers to cheat the public at large.

2.      Hold M/s Era Landmarks guilty of violating and contravening all laws, rules, provisions, terms and conditions of the Haryana Development & Regulations of Urban Areas Act, 1975.

3.      Direct the Licensee to stay construction and sale of floors/flats to public at large till the pendency of the present complaint.

4.      Direct  the police to take cognizance of mala fide and ulterior motives of Both the colonizers to cheat and fraud with the public at large for own profit.

5.      Direct both the colonizers to jointly provide alternative floors/flats in same vicinity with matching specification to all allottees which has legal sanctity of the competent Authority.

6.      Direct both the colonizers to pay punitive charges to all allottees at the rate of 24% on the money collected so far from all allottees from the date of booking of their flats and floors in the ponzi scheme hatched together by the above named colonizers.

7.      Hold the licensee guilty of concealing critical facts to the Competent Authority as is required under Section 24, 25, 26 & 27 of the Rules of 1976.

It is further prayed that all suitable relief that may be deemed fit may be granted in favor of the allottees and against the licensee’s, for which actions we would always be obliged and grateful.

Complainant

                                                                                                                       

                                                                                                                        Dr. Naveen Airchwal

H.No. 2440, sector-8, Faridabad

Verification:

Verified at Delhi on 13^Th June, 2013 that the contents of the Paras 1to 9 of the complaint are true and correct to my best knowledge and believed to be true. Last paragraph is the prayer to this competent authority. All Enclosure have been self attested as true copies and the Complainant be given relief to put forth Photostat copies as relevant proofs in the present complaint.

                                                                                                                        Complainant   

                                                                                                                        Dr. Naveen Airchwal

H.No. 2440, sector-8, Faridabad,

Date-   13/06/2013                                                                                         

Place- Faridabad                                                                    

Enclosed:-

1.      Annexure 1:- Copy of receipts of consumers of Era Landmarks.

2.      Anexxure 2:- Copy of sales brochure for Era Divine Court.

3.      Annexure 3:-  Pictures of construction work done on the site.

Colonizers Overcharge EDC, Delay Deposit with HUDA

Article Reported in THE HINDU..10/06/2013, By Ashok Kumar...

The External Development Charges or the EDC, as it is usually referred to, is not a new term for the flat buyers in Haryana. One of the sources of inflow of funds for the Haryana Urban Development Authority (HUDA), the EDC is charged from the colonisers in return for services like water supply, sewage, roads and other town-level facilities provided by the HUDA and the colonisers further transfer the burden to the flat buyers as mandatory charges thus nipping in the bud any enquiries on it. But there is certainly far more to it than meets the eye.

A bunch of alert flat buyers -- now united as the Greater Faridabad Welfare Association (GFWA), out to fight the over-delayed development in the Greater Faridabad or Neharpar, a 2,500 acre area comprising Sector 75 to 89 -- have shockingly discovered through a series of RTI applications that the colonisers not just charge the EDC arbitrarily, and probably overcharge making undue profits of several hundred crores, but are also allowed by the authorities concerned to enjoy the large sums of money thus collected for years together in furtherance of their business interests at the expense of the hapless flat buyers.

“It is a simple arithmetic. The Town and Country Planning Department collects the EDC from the coloniser per acre and the coloniser in turn collects it from the flat buyers at per square feet on the total super area (or saleable area) of the flat. But there being no transparency or uniform policy for collection of EDC and the government not collecting it directly from the buyers, the colonisers charge at will,” said Aashish Kaul, a working committee member of GFWA.

Explaining it with an example, Mr. Kaul, continued: “For instance, M/s Omaxe Limited was supposed to pay Rs.27,00,37,842 as EDC to HUDA at the rate of Rs.94.94 lakh per acre for its 28.443 acre group housing project, “Omaxe Heights”, in Sector 86 Faridabad. The company collected the EDC on super area (or saleable area) for the project which totals up to 23,00,000 sq. feet. So it should have collected the EDC at Rs.117.40 per sq feet, but instead charged at Rs.150 per square feet. It is thus evident that the coloniser over charged all the flat owners by Rs.32.60 per square feet thus making a profit of Rs.7.50 crore.”

Even an audit report by the Town and Country Planning (a copy of which is with The Hindu ) has conceded to such practices. “It is found that the colonisers are paying EDC to the Department as per the prescribed rates…but they are charging EDC, as fixed by them, on the saleable area per square feet from the buyers, which varies from coloniser to coloniser. It is also found that no uniform method is being adopted by the colonisers while fixing the rate of EDC,” it said. Though the audit report said that some of the colonisers increased the rate of EDC by including the interest because the plots/flats were sold in different years over a span of three years after obtaining licences from the Haryana Government, Mr. Kaul refused to take the bait. “Most of the projects are sold by the colonisers during the soft-launch itself before procuring the licences, which is an illegal practice but a norm in Haryana and no action is taken against it. So it is difficult to believe that the colonisers took three years to sell their projects and hence over charged.’’

Secondly he said, “the coloniser collects the EDC from the flat buyer usually at the time of payment of 3rd and 4th instalments itself, but is allowed by the authorities to deposit the same to them in six monthly instalments spread over four years. So the coloniser is not just allowed to use the large sums of money thus collected for his business interests, with the burden of interest being shifted to the flat buyers, but it also delays the development of the area and the possession of the flat. And it is again the home buyer who is hit the most hit by the delay as he continues to pay the EMIs as well as the rent and the wait for the flat turns into a prolonged agony.”

The information secured under the RTI Act has also revealed how several colonisers had not paid even 50 per cent of their EDC dues to the department even after four years of having procured the licences. All this while they continued to enjoy the interest on the money being extorted from the poor flat buyers. And still, no action was initiated against these colonisers by the authorities concerned.

Even though the audit report advocates the need for “uniform policy” to make the matter more “transparent and justified” and states that an “undertaking may also be obtained from each of the concerned colonisers that EDC is not being charged from the flat/plot buyers as profitable charge”, the government is mum on the issue that concerns lakhs of flat buyers, especially in Gurgaon and Faridabad, thus casting suspicion over the intentions of the Hooda Government which is already drawing flak for allegedly allowing the colonisers a free run and opportunities to make exorbitant profits.

NATIONAL CONSUMER COURT COMPENSATES FOR DELAYED POSSESSION.

BUILDER DIRECTED TO PAY COMPENSATION FOR DELAYED FLAT DELIVERY

Mrs Veena Khanna of New Delhi Vs M/s. Ansal Properties and Adharshila Towers, New Delhi: Before National Consumer Disputes Redressal Commission, New Delhi: Order dated 9th July 2007

Due to abnormal delay in handing over the possession of flat, the Complainant had demanded refund of the deposited amount with interest @ 18% which the Opposite party refused to pay. Complainant filed a petition before the State Commission, Delhi. By judgement and Order dt.06-12-2005, the State Commission directed the Opposite Party to refund the amount of Rs.15,00,000 with interest @ 13% p.a. from the date of deposit of the last instalment till the date of payment of refund. In the alternative it also directed that if the Opposite Parties choose to handover the possession of the flat, the order of refund with interest will not come into operation.

Against the above Order of State Commission, the Complainant Mrs. Veena Khanna filed an Appeal in the National Consumer Dispute Redressal Commission praying that the Opposite Parties be directed to deliver the possession of the flat and also compensation for delay in delivery or adequate compensation should be awarded so that she can purchase a flat of the size.

It was argued that as the afore-quoted order passed by the State Commission gave preferable alternative to the Opposite Parties, and the builder took undue advantage of it and refunded the amount deposited by the complainant with interest, as directed, because of the rise in the prices of the immovable properties.

Opposite Parties took advantage only because an option was given to either refund the amount or to hand-over possession of the flat and no adequate compensation was awarded. The National Consumer Dispute Redressal Commission commented that if such contentions of refunding of the money with payment of minimal interest is accepted, the builders would earn millions of rupees by delaying the delivery of the possession of the flat for months together for one reason or the other.

After considering the arguments of the counsels representing both the parties the National Consumer Dispute Redressal Commission decided that the Complainant is required to be compensated for delay in construction of the flat and for not allotting the same to her. Because of the delay in construction and delay in deciding the matter, it is practically impossible for a retired Govt. employee to purchase a flat at the present price.

The National Consumer Dispute Redressal Commission further stated that therefore, there are two alternatives – (a) one is to give adequate compensation for delay and to direct the Opposite Parties to hand-over possession of an alternative flat in the vicinity of the area where the flat was  allotted to the Complainant; (b) or secondly, to pay adequate compensation to enable the Complainant to purchase a new flat of the same area in the same or similar locality.

The Opposite Parties were directed to pay a sum of Rs.7,50,000/- as compensation to the Complainant for the period she suffered financially. This was on the presumption that the value of the flat has escalated. However, if the builder considers that compensation of Rs.7,50,000/- (Rupees seven lakhs and fifty thousand) is more or excessive, it would be open to the builder to provide an alternative flat of the size and price agreed, in the same locality or near about, to the complainant for which an appropriate allotment letter will be issued by them in favour of the Complainant within a period of eight weeks from the date of the order. If the same is not issued, it shall pay compensation of Rs.7,50,000/- to the complainant, as directed.

The builder must deliver the project in time along with 100 per cent transparency in all the dealings. He must stick to the promised terms and conditions and pay penalty if the project delivery is late. Trust is the most important element in a society-builder relation and that should be well taken care of by the builder. Get all the promises or agreements made by builder in writing. It should outline the work to be done, date of completion, amenities or facilities promised.

Dilip Shah

Counselor and Analyst for Redevelopment of Housing Societies

dilip7shah@gmail.com

9819825752

32411533

Unitech to reimburse rent to buyer for delay in giving flat

This is a news piece which I thought would encourage all Home-buyers who are aggrieved by the callus attitude of their respective Colonizer's. Please note that all big and small Colonizers have the same modus operandi, its now left to the Consumers to initiate action so that these real estate mal-practices come to an end.......

NEW DELHI: Realty major Unitech Ltd has been directed by the apex consumer commission to reimburse nearly Rs 14 lakh spent by a customer on rent after the flat for which he paid over Rs 1.37 crore in 2007 was not handed over to him till date.
The National Consumer Disputes Redressal Commission (NCDRC) also pulled up the real estate major and its top officials, Executive Chairman Ramesh Chandra and Managing Directors Sanjay Chandra and Ajay Chandra, saying "even after lapse of six years the flats are not ready".
"It is clear that the opposite parties (Unitech and its officials) want to have benefit of both the worlds. They have received the entire price of the apartment at the time of execution of the agreement. Even after the lapse of six years, the flats are not ready.
"The opposite parties have offered peanuts for delaying construction of work. They have to honour their commitment," a bench headed by Justice J M Malik said, giving six months time to Unitech to hand over the flat in one of its residential townships in Gurgaon to Sanjay Goyal.