Regulating the Real Estate sector
Goa has no real estate legislation to protect the lifetime savings of citizens, says Adv CLEOFATO ALMEIDA COUTINHO
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Goa experienced a massive real estate boom in the early ’90s. Builders and real estate developers started putting up residential projects on a large scale. Persons not of Goan origin started buying these apartments/villas as second holiday homes. The nuclear family concept added to the demand, as more and more nuclear families moved from villages in Goa to the main towns, basically for better educational opportunities for their children.
However, despite this boom being on for nearly two decades now, the state has not taken any initiative to legislate on apartments and villas in common areas. In 1993, former Deputy Chief Minister Ramakant Khalap brought before the Goa Legislative Assembly a bill modelled on the lines of a Maharashtra law. But it never saw the light of day, as it was referred to a select committee. A similar Bill was again brought before the house by independent MLA Radharao Gracias, but was withdrawn (private members’ Bills almost never become law).
For 17 long years now, we are without a legislation on real estate, despite the select committee having approved the tone and tenor of the Bill. It is incomprehensible why successive governments have not thought it fit to bring in real estate legislation, even when the boom in Goa did slump like in the metropolitan cities, and it involves the lifetime savings of thousands of citizens.
The ownership of an apartment/villa in common property envisages: (i) The exclusive right of occupation in respect of a part of a building. (ii) Use and enjoyment of common areas, amenities and services. (iii) Liabilities pertaining to maintenance of common areas and services, as well as maintenance of buildings/apartments. (iv) Undivided right in the land on which the apartments/villas stand. These issues become extremely crucial when buildings require repairs, have to be reconstructed owing to natural calamities, or face natural wear and tear.
Owners of apartments/villas should get a windfall in case the floor area ration (FAR) or floor space index (FSI) in their area increases. Conversely, their rights shrink in case the FAR/FSI is brought down by planning regulations. It appears that in Goa, this potential windfall is sought to be cornered by vested interests, taking advantage of a lack of legislation.
Thousands of apartment owners in the state of Goa are without a valid title. They are holding on, in most cases, on the basis of an ‘Agreement to Sell’. Many have invested their lifetime savings in buying a roof over their heads, but are not the legal owners of that roof. That is because laws mandating conveyance of title to individual apartment purchasers or to cooperative housing societies (CHS) do not exist in our state.
Maharashtra pioneered two legislations. One regulated construction and compulsorily required the promoters to form a housing society or a company. This was called the Maharashtra Ownership Flats (Regulations of the Promotion of Construction, Sale, Management and Transfer) Act (1963). The other mandated free and absolute title to individual purchasers (the Maharashtra Apartment Ownership Act, 1970). The 1963 Act led to a new concept of ‘dual ownership’, where the housing societies became owners of buildings and land, while apartment purchasers got shares, together with occupancy rights in respect of their individual flats.
The promoter regulation acts of various states attempted to deal with what could be considered as excesses by the real estate industry: (a) Collecting huge amounts prior to even the construction proposals being approved. (b) Creating a mortgage on the property before or after entering into an agreement of sale with third parties, without letting them know of the mortgage. (c) Not delivering apartments in time. (d) Changing approved plans midway. (e) Not transferring apartments to individual flat purchasers or to housing societies, with the fond hope that the FAR/FSI in the area would increase and they could benefit. (f) Collecting huge maintenance fees and siphoning it off through inflated charges. (g) Issuing misleading advertisements.
All these and other issues ought to be taken care of by law, and cannot be left to market forces, since the hard-earned lifetime savings of citizens are involved. Despite some states bringing laws, there is no denying that the real estate sector is still one of the most unregulated, insofar as relations between the developer/ promoter/builder and the purchaser are concerned.
The central government had announced a Model Real Estate (Regulation and Development) Act, which was put up for discussion before it was brought before Parliament. It envisages regulatory and appellate authorities to regulate, control and promote development by construction, sale, transfer and management of residential apartments. Though the model legislation is a welcome move to bring discipline to the sector, the proposed legislation is not binding on states, which have to enact separate legislations.
The regulatory authority proposed is in addition to existing authorities under different local, planning, revenue and tax establishments. There are dozens of licenses and approvals to be obtained prior to starting development and, taking into consideration the way our systems work, the new proposed authorities would only delay approvals, add to the cost and create additional structures that would only set the clock back.
This is the era of liberalisation. The proposed legislation will only take the real estate industry back to the license raj era. Creation of additional authorities has always led to more corruption. Extortionate demands by authorities invariably lead to delays and cost escalation, ultimately borne by the purchaser. Power to such authorities has traditionally led to its misuse, and no system to deal with this menace has yet been discovered.
Somehow, the regulation system has failed in our country, even though we are in the process of creating more and more regulators to withdraw such matters from the judicial arena, with the fond hope that litigation will come down. Bringing down litigation may end in ‘good statistics’, but there will be no progress in actual dispute resolution.
Especially in real estate, promoters ought to be made responsible and liable, so that the excesses complained of by citizens and investors are taken care of by law administered through the courts. We have enough laws like the Consumer Protection Act, the Specific Relief Act, etc, to enforce rights created under law.
In addition to these existing civil remedies, heavy penalties ought to be the thrust area of any proposed legislation. Punishments add to the enforcement of rights, and will enable the indiscipline in the sector to be done away with. When it comes to enforcement of rights and punishing the guilty, despite the slow process, the common man still has faith in the courts. That this faith gets shaken in certain cases is a different matter. Still, the courts remain the last bastion in a collapsing system.
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Marketing God
by Smitha Bhandare Kamat
Walk down the lane of time, and witness the use and abuse of ‘religion’. It was, it is and it will continue to be so, and yet, can we be optimistic and hope the next generation and the generations to come won’t be a pawn in the hands of radicals and crusaders that sprout in each ‘yuga’? The names, the faces change, but the motive remains intact – pain, discord, anguish and death of the innocent, all in the name of ‘God’. It has been said: “Man never do evil so completely and cheerfully as when they do it from religious convictions”. Let’s keep the statistics aside and ponder over the role of religion, in our mundane lives. Surprisingly, it bears characteristics, very much like any other product in a barmy bazaar. Competition, or rather cut throat competition, and the survival of the fittest describes it all. Whether its coke or pepsi, Ford or Maruti, Able or Kane, a similar logic applies, and so you will have each religious bigot, working hard, to campaign, position and market their religious product.
They will enter the market; carve a niche for themselves and their beliefs. They will toil and work hard to retain and extend their market. With media and theological progress and information explosion, chances are each one of us, whether we like it or not, will be exposed to varied faiths, from all sides. Each theology’s ideology will strive for the proverbial competitive edge over its competitor and in most probability, the generations to come will all be a fine hybrid version of different faiths.
Going by the trend, maybe one can term this as a just another, ‘re-mix’ edition dished out. Certainly, inter race, inter class and inter religious marriages, crossing physical and political boundaries is more of a reality, as never before. Hopefully, such a product will be devoid of fanaticism and will be seeped more in universality and tolerance, more in line with the global village concept. But, to ensure that such seeds of acceptance and tolerance are sowed, let’s start at a micro level, with the teacher of mankind – ‘the child’.
Besides feeding academics and catering to his scholastic needs, one has to satisfy his spiritual hunger. Expose him to the beauties of God – Christ, Krishna, Ram, Rahim, what’s in a name? Many will disagree, but if we refuse to change with the changing times, time will change us anyway. Better to teach him in the words of Thomas Hardy: “the main object of religion is not to get a man into heaven, but to get heaven into him”.
The practice of demanding to quote one’s religion, for every minor to major transaction should be eliminated altogether. One’s faith and religion should be a very private affair, much so like one’s sex life. No need to air it in public. Posts, seats and reservations based on such concepts should be erased and instead, only one set should have a loud say, – reservation for the ‘economically backward’. Finally, the obsession with the ‘place of worship’, be it temple, church, mosque, pulling down the same, and rebuilding will have us all in its vicious grip. Emotions and passions are set free, logic and good sense takes a back seat. ‘Babri-Masjid’, is still fresh and refuses to heal. It is time, a total turnaround takes place, where there will be no addition to the existing shrines, and funds may be utilised, if need be, for the maintenance and enhancement of existing structures. Or better still, feed the hungry mouths. New glittering concrete edifices won’t serve the purpose if God is abused. Have new parks, add greenery, and keep the environment clean. Experience God in every day’s little deeds. If a place of worship is a must, then let it cater to all religions. Where people of different faiths walk under one roof, where the Koran, Bhagwat Gita, Bible and the Holy Scriptures resonate in harmony. Let parity reign supreme. Finally, the aim of all religions is to teach man how to live. For men of sense are all of one religion. So let us stop commercialising and marketing God. Let us for a change, give God his due place.
As is rightly said: ‘So many Gods, so many Creeds, so many paths that wind and wind, while just the art of being kind, is all the world needs.’
