Although almost all the consumers in Bengaluru who purchase flats and apartments are concerned about A or B khata, they do not bother to verify whether the property purchased by them has a valid Completion certificate / Occupancy certificate.
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In simple terms, the absence of a valid Completion certificate / Occupancy certificate, means that the building may not have been built as per approved plan, and the threat of demolition of unauthorised structure looms large.
Further, if you want to sell or hypothecate the property after a lapse of say 10 years, you will not be able to do so, if you do not possess a valid Completion certificate / Occupancy certificate. Though this is not blocked by law, people usually do not purchase the houses without occupation certificates. When one goes to bank for mortgaging a house, they also look for occupancy certificate.
Many buyers are not aware of the importance of Completion Certificate and Occupancy Certificate. Even when someone knows it, builders trick the buyers by not giving. What should the buyer do in such situations?
Does the law help?
Supreme Court has given a judgment in a case between Faqir Chand Gulati and Uppal Agencies Pvt. Ltd. which clearly holds the builder responsible for the provision of completion and occupancy certificate. It also underlines the problems created by such acts of the builders. The case was between a land owner and builder, over not having Completion and Occupancy Certificates for the constructions, and deviations from the sanctioned plan.
Some of the excerpts from this landmark judgment are as follows:
1.1 Builders violate with impunity the sanctioned building plans and indulge deviations much to the prejudice of the planned development of the city and at the peril of the occupants of the premises constructed or of the inhabitants of the city at large. Serious threat is posed to ecology and environment and, at the same time, the infrastructure consisting of water supply, sewerage and traffic movement facilities suffer unbearable burden and are often thrown out of gear.
Unwary purchasers in search of roof over their heads and purchasing flats/apartments from builders, find themselves having fallen prey and become victims to the design of unscrupulous builders. The builder conveniently walks away having pocketed the money leaving behind the unfortunate occupants to face the music in the event of unauthorized constructions being detected or exposed and threatened with demolition.
Though the local authorities have the staff consisting of engineers and inspectors whose duty is to keep a watch on building activities and to promptly stop the illegal constructions or deviations coming up, they often fail in discharging their duty. Either they don’t act or do not act promptly or do connive at such activities apparently for illegitimate considerations. If such activities are to stop, some stringent actions are required to be taken by ruthlessly demolishing the illegal constructions and non-compoundable deviations. The unwary purchasers who shall be the sufferers must be adequately compensated by the builder.
The arms of the law must stretch to catch hold of such unscrupulous builders. At the same time in order to secure vigilant performance of duties, responsibility should be fixed on the officials whose duty was to prevent unauthorised construction, but who failed in doing so either by negligence or connivance.
1.2. “If the construction is part of a building which in law requires a completion certificate or C&D forms (relating to assessment), the builder is bound to provide the completion certificate or C&D forms. He is also bound to provide amenities and facilities like water, electricity and drainage in terms of the agreement. If the completion certificate and C&D forms are not being issued by the Corporation because the builder has made deviations/violations in construction, it is his duty to rectify those deviations or bring the deviations within permissible limits and secure a completion certificate and C&D forms from MCD.
The builder can not say that he has constructed a ground floor and delivered it and therefore fulfilled his obligations. Nor can the builder contend that he is not bound to produce the completion certificate, but only bound to apply for completion certificate. He cannot say that he is not concerned whether the building is in accordance with the sanction plan or not, whether it fulfills the requirements of the municipal bye-laws or not, or whether there are violations or deviations.
The builder cannot be permitted to avoid or escape the consequences of his illegal acts. The obligation on the part of the builder to secure a sanctioned plan and construct a building, carries with it an implied obligation to comply with the requirements of municipal and building laws and secure the mandatory permissions/certificates.”
1.3 “A prayer for completion certificate and C&D Forms cannot be brushed aside by stating that the builder has already applied for the completion certificate or C&D Forms. If it is not issued, the builder owes a duty to make necessary application and obtain it. If it is wrongly withheld, he may have to approach the appropriate court or other forum to secure it.
If it is justifiably withheld or refused, necessarily the builder will have to do whatever that is required to be done to bring the building in consonance with the sanctioned plan so that the municipal authorities can inspect and issue the completion certificate and also assess the property to tax. If the builder fails to do so, he will be liable to compensate the complainant for all loss/damage. Therefore, the assumption of the State Commission and National Commission that the obligation of the builder was discharged when he merely applied for a completion certificate is incorrect.”
Through this judgment, the Supreme Court directed the consumer forum to re-look the case and treat the land owner as a ‘consumer.’ Though the context of litigation is somewhat different, the judgment underlines the importance of the builder obtaining occupancy certificate. This is usable in other cases being fought by the residents wanting Completion Certificate / Occupancy Certificate.
Get your Occupancy Certificate through Consumer Forum
Now, how to deal with the builder who has not given you a valid Completion Certificate / Occupancy Certificate?
You need to issue a notice to the builder to apply and handover Completion Certificate / Occupancy Certificate, within one month from the date of issue of your notice.
If the builder does not respond, file a complaint in the consumer forum, and pray the forum to issue directions to the builder to apply and obtain the above certificates.
You can also mention in the complaint that the Hon’ble Supreme Court has given a judgement in Faqir Chand Gulati vs Uppal Agencies Pvt. Ltd. & Anr on 10 July, 2008 that “Even if such a provision for providing completion certificate is not found in the agreement, the builder cannot escape the liability for securing the Completion Certificate and providing a copy thereof to the owner. The law requires the builder to obtain completion certificate of such a building.”
If this does not work, one can actually file a writ with relevant documents, against the errant builder. Surely this is better than having to face a Campa-Cola-like situation some other day in the future!