How to Get Deemed Conveyance When the Builder Refuses?
Many housing societies in Maharashtra face the issue of deemed conveyance when builders refuse to execute the conveyance deed for properties. This often leaves members without legal ownership, creating complications regarding property rights, redevelopment, and access to financial services. This article outlines the process for obtaining deemed conveyance and guides housing societies through the necessary legal steps.
Quick Answer
In accordance with Section 11 of the Maharashtra Ownership Flats Act, 1963 (MOFA), a housing society can apply for deemed conveyance from the Deputy Inspector General of Registration and Controller of Stamps (Competent Authority) if the builder fails to execute the conveyance deed within four months of the society being registered. Should the builder not respond or refuse without valid reasons, the Competent Authority can grant an order that deems the property conveyed to the society, allowing the society to obtain the conveyance deed without the builder's signature.
What Is Deemed Conveyance?
Deemed conveyance is a legal remedy that allows a housing society to acquire ownership of land and buildings through a statutory order when the builder has failed to execute the conveyance deed. Under normal circumstances, once a housing project is completed and sold, the builder is obligated to transfer ownership of the land and common areas to the society by executing a conveyance deed. Unfortunately, many builders delay or refuse this transfer for various reasons, including control over the property or financial disputes.
The deemed conveyance procedure was enacted to protect housing societies from such builder malfeasance, enabling them to secure legal ownership even against the builder's will.
Legal Framework: Section 11 of MOFA
Section 11 of MOFA mandates that a builder must execute and register a conveyance of the land and building in favor of the society within four months from the date of registration or formation of the society. If the builder does not comply, the society can apply to the Competent Authority for deemed conveyance.
The legal process has been made more robust by amendments to MOFA in 2016, which streamlined procedures and reduced the valid grounds for builder objections, making the process more effective for societies seeking conveyance.
When Can You Apply for Deemed Conveyance?
A society can apply for deemed conveyance under the following conditions:
The society must be registered under the Maharashtra Co-operative Societies Act, 1960 or formed as an association of flat purchasers.
The builder has not executed the conveyance deed within four months since the date of registration or formation.
The building must be completed, generally evidenced by an Occupation Certificate or Completion Certificate.
The society must represent the flat purchasers collectively owning the building.
There must not be an existing valid conveyance deed already registered in favor of the society.
If these conditions are met, the society has a statutory right to file for deemed conveyance without waiting for the builder's compliance.
What If the Builder Refuses or Ignores Notices?
The refusal of the builder does not prevent the society from obtaining deemed conveyance. Before filing, the society should document all attempts to contact the builder, including written requests and reminders. Typical arguments builders use for refusal may include:
- Outstanding dues against the society or members.
- Claims of unresolved construction defects or maintenance issues.
- Allegations of non-cooperation from the society.
- Title issues or encumbrances related to the property.
These objections do not inherently defeat the application for deemed conveyance, and if the builder does not respond, the Competent Authority can issue an ex parte order in favor of the society.
Documents Required for Deemed Conveyance Application
The following documents are essential for filing a deemed conveyance application:
Application Form: Completed application form under MOFA, signed by the society's Chairman and Secretary.
Society Registration Certificate: Certified copy indicating registration under the Maharashtra Co-operative Societies Act.
Society Bye-Laws: Certified copy of the registered bye-laws.
List of Members: Updated list showing details of society members.
Sale Agreements: Copies of sale agreements between the builder and individual flat purchasers.
Occupation Certificate or Completion Certificate: Proof that construction is complete and occupancy has been granted.
Approved Building Plans: Copies of the sanctioned building plans from the local authority.
Title Documents of the Builder: Evidence of how the builder acquired ownership of the land.
NOC from Financial Institutions: If applicable, to confirm there are no contradictions to the conveyance.
Affidavit: Confirming that the builder has failed to execute the conveyance after requests.
Resolution of the Society: A resolution authorizing the committee to file the application.
Correspondence with the Builder: Documented communication related to the conveyance request.
Evidence of Stamp Duty Payment: Proof of payment for applicable stamp duty and registration fees.
An organized and complete application is crucial, as incomplete submissions may lead to delays or rejection.
The Deemed Conveyance Procedure
The procedure for deemed conveyance typically follows these steps:
File the Application: Submit the application with necessary documentation to the office of the Competent Authority.
Scrutiny of Application: The Competent Authority will review the application for completeness and eligibility.
Notice to the Builder: If compliant, the Competent Authority will notify the builder, allowing them time to respond.
Builder's Response: The builder may agree to convey, oppose the application, or not respond at all.
Society's Reply: If objections are raised, the society has the opportunity to respond with counterarguments and evidence.
Hearing: The Competent Authority may hold hearings to hear arguments from both parties.
Inspection: An inspection of the property may be conducted to verify details.
Order of Deemed Conveyance: A favorable order is issued by the Competent Authority upon finding the society entitled to conveyance.
Payment of Stamp Duty and Registration: After necessary payments, the order is registered, granting ownership rights to the society.
Mutation of Records: The society can request updates to local land records to reflect the change of ownership.
How Long Does the Process Take?
The timeline can vary based on circumstances:
- If the builder does not contest, the process may take 6 to 12 months.
- If objections are raised, it could take 1.5 to 3 years depending on complexity and the number of hearings.
- Complications such as title disputes or external claims can extend this timeline even further.
Societies should actively engage with the Competent Authority during the process to keep things moving efficiently.
What Objections Can the Builder Raise?
Common objections from builders may include:
- Claims of outstanding dues.
- Allegations of defects or non-compliance by the society.
- Arguments regarding the separate sale of amenities.
- Title or legal issue claims.
- Assertions of their rights to retain certain portions of the property.
The Competent Authority will review these objections and decide their validity regarding the society's entitlement to conveyance.
What the Society Must Prove
To successfully obtain deemed conveyance, the society must demonstrate:
- Compliance with the eligibility criteria under MOFA.
- That the property claimed belongs to the society based on legal agreements.
- Completion of construction with the issuance of an Occupation Certificate.
- The absence of a registered conveyance deed in favor of the society.
- The builder's non-compliance after the four-month period post-registration.
Legal Remedies
In case of builder non-compliance, legal remedies may include:
- Filing an application for deemed conveyance.
- Approaching the Cooperative Court or the Bombay High Court if disputes persist.
- Considering mediation or arbitration as an option for conflict resolution.
When to Consult a Lawyer
Consider seeking legal assistance if:
- You receive a legal notice from the builder.
- You are unsure about document preparation.
- Escalation to litigation seems imminent.
By following the outlined steps and preparing diligently, housing societies can navigate the process of obtaining deemed conveyance, ensuring their rights and the security of their properties in Maharashtra.
