SC Judgement: Builders can't sell open and stilt parking spaces

[dheerajjain]

Stilt and open parking spaces cannot be sold by builders as they form part of common area

http://www.bankingonly.com/detail-news.php?news_id=219

Source: Indian Express, DNA

The Supreme Court ruled out on Wednesday 29.08.2010 that Developers cannot sell open spaces and stilt areas in their buildings as these are meant for common use and form part of the flats. Flat purchasers need not shell out extra money from their savings to buy parking spaces, both open and closed, from property developers at the time of sale.
“Open-to-sky” areas or “stilted” (covered) portions of their flat complexes, usable as parking spaces, cannot be sold separately by flat
builders/promoters/developers as “garage”, the Supreme Court has ruled.
These spaces are part of the “common areas” in flat complexes and not “saleable independently as a flat or along with a flat”, the court said in a judgment.
The verdict sets a precedent even as the apex court took note that builders/promoters/developers were “indulging in malpractices in the sale and transfer of flats and the flat purchasers were being exploited”.
The judgment delivered Tuesday by a bench of Justices R M Lodha and A K Patnaik comes in the backdrop of interpreting the legislative intent behind enacting the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1969.
The court made the observations while dismissing an appeal filed by Mumbai promoter Nahalchand Laloochand Private Limited, seeking permanent injunction against a co-operative housing society to whom they had sold a few properties in Anand Nagar, Dahisar (East) in the city. They accused society members of “encroaching” into 25 stilt parking spaces in the building.
The court said promoters will not be put to any financial prejudice by treating parking spaces as common areas since “he (promoter) is entitled to charge price for the common areas and facilities from each flat purchaser in proportion to the carpet area of the flat”.
“Can a promoter take a common passage/lobbies or say staircase or the RG area out of purview of ‘common areas and facilities’ by not prescribing or defining the same in the ‘common areas’?” asked the court and illustrated how the Maharashtra law mandates the promoter to describe the “common areas and facilities” in the advertisement as well as in the agreement later with the buyer.
“The promoter is required to indicate the price of the flat, including the proportionate price of the common areas and facilities. If the promoter does not disclose the common areas and facilities, he does so at his own peril,” the bench observed.
The court clarified that “stilt” or covered parking spaces were “common areas”, and would not cease to be so even if the promoter fails to describe them as common spaces.
As per DNA reports:
Developers cannot sell open spaces and stilt areas in their buildings as these are meant for common use and form part of the flats, the Supreme Court ruled on Wednesday. The ruling could bring relief to lakhs of flat-owners in different housing societies in Mumbai engaged in a tug of war with the builders over the sale of such space as parking lots.
The court made it clear that the developers, or promoters, do not have the right to sell any portion of such a building which is not a ‘flat’ and the entire land and building has to be transferred (conveyed) to the housing society or an organisation.
The only right with the promoter is to sell unsold flats, said a bench of justices RM Lodha and AK Patnaik. It was hearing a batch of appeals filed by Maharashtra-based realty promoters challenging a Bombay high court ruling of April 25, 2008.
The high court (HC) had held that parking space enclosed or unenclosed, covered or open, cannot be a ‘building’, thus can’t be sold independently of the flats. The apex court bench also upheld the HC’s ruling that said it is a compulsory requirement (for the builders) to provide for parking spaces under the Development Control Regulation (DCR). Promoters are under obligation to follow the DCR, it had said.
The agreement signed under the Maharashtra Ownership of Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 (MOFA), between the developer and the flat purchasers must be in conformity with the model form of agreement prescribed by the state government. The bench said the model agreement does not state that the flat purchasers separately buy stilt parking spaces.
The rights accruing to flat purchasers after signing an agreement under MOFA “cannot be diluted by any contract or an undertaking to the contrary”, it said. The undertakings contrary to the DCR will not be binding either on the flat purchasers or the society.
As soon as the corporation concerned issues the occupation certificate and the society is registered, the building as well as the stilt parking spaces, open spaces and all common amenities become the property of the society. They cannot be put on sale by the developer.

[deepalivivek]

I was watching Property Guru Show and there I came to know that according to the Supreme Court of India builders cannot sell stilt and open parking areas .Then it means all the builders are fooling us by charging such charges from us?
Please someone explain to me whether we can go to consumer court for this?

Thanks.
Regards,
Deepali Jain

[naveenarichwal]

These articles can help you to take decision.

http://articles.timesofindia.indiatimes ... developers

http://articles.timesofindia.indiatimes ... king-areas

http://www.expressindia.com/latest-news ... sc/676177/

http://ekikrat.in/Under-What-Circumstan ... umer-Court

[naveenarichwal]

The answer to your query is in
http://ekikrat.in/Under-What-Circumstan ... umer-Court
The activities of the builders and the housing developer are most of the times annoying. Most of the times they refuse to listen and care about the neighbor people; they follow and keep doing what they think right that too with force. In that case, the neighbor people may feel helpless, even scared to take any action against them. It is suggested that if any person has any grievance against the builder or the housing develop the person should not fear and sit quite rather he or she should follow the below mentioned steps:

The person should let the builder know about the grievance and send a notice to the builder in writing.
The builder may refuse to accept the notice. Even in that case also there is nothing to be scared of. The proof of the notice i.e. the copy of the notice is to be retained and should be sent by registered post or Under Postal Certificate. The proof of the sending should also be retained.
The evidence of sending the notice is legitimate in the Consumer Court under Section 28A (3) of the Consumer Protection (Amendment) Act of 2002 and will be affirmed as the notice has been suitably served.
Any person can file a complaint against the builder, developer, housing with the consumer court under the following circumstances:

Delivered a house that does not comply with the specifications agreed upon.
Did not provide for free parking space within the compound / complex.
Charged higher than agreed amount.
Did not form co-operative housing society and handed it over to its members.
Did not provide for water storage tank.
Did not give a receipt against the paid amount.
Did not provide for enough ventilation and light.
Delivered a poor quality construction.
Did not deliver the house within the agreed time limit. If time limit not mentioned, it is assumed that the construction will be finished within maximum of 2 years from the date of start of work.
Did not give accounts for the expenses against which the builder has collected money, i.e. maintenance, electrical installations (transformer),etc.

[naveenarichwal]

Also read

http://legalservicesindia.com/article/p ... rt_id=1116

[naveenarichwal]

When a BBA states that covered parking space has been sold to you for Rs 1,50,000/- and we have signed the BBA and latter on the costumer gets the knowledge of Supreme Court order, than what can a costumer do to remove this clause from BBA?

I think the Legal team of GFWA can enlighten regarding this ,because most of the Investor have fallen in this trap of Builders.

[naveenarichwal]

I asked this query from a Lawyer and he told me to file a legal notice ,if the builder refuses then file a case in consumer court.

[rtiwari2k7]

Dear Mr. Dheeraj,

I have attached supreme court order copy which I have downloaded from Supreme court site which states that parking should not be charged Open/closed. Kindly suggest how to proceed?

Regards,
Rajeev Tiwari

[dheerajjain]

Dear Mr. Dheeraj,

I have attached supreme court order copy which I have downloaded from Supreme court site which states that parking should not be charged Open/closed. Kindly suggest how to proceed?

Regards,
Rajeev Tiwari

Dear Rajeev

Approaching Consumer Forums (District/State/National) in this regards is a good option.Don't expect any relief from Govt. and builders by showing this judgment.

[naveenarichwal]

Answer regarding sale of Covered parking space from Era Landmarks costumer care:-

Dear Sir,

Greetings for the day !!

As per the BBA , you have been charged for car parking space reservation .
We haven’t sold you the parking space.
You are requested to go through the clause again for more clarification.

Thanks & Regards
Team Crm
ELL
This shows the Cunning nature of the builder on being forced to accept the cheating they are doing to loot the costumers.

At the time of signing the BBA they told us that parking space will be yours and you can sell it latter when you selll your appartment at a premium i.e. at present its value is 1.5 L it may be 5L latter at the time of sale of the appartment or if i want to sell the parking.

[yadav_ajay]

Yes, all builders are saying the same.

Builder are saying that they have not sold parking slots, while they are giving usage rights.

They are saying that Apex court ruling says that parking slot can't be sold to outsider (other than unit holder in the society).

Apex Court ruling came when one of Mumbai builder sold the Society parking to some outsiders and then those society unit holders filed case in High court and then in Supreme court.

I'm not expert in law, I think we need to consult some lawyer on this and need to send legal notice to builders.

[dheerajjain]

Builder logic is FALSE. They can't charge for allocating parking space in common area. As per Haryana Apartment Ownership Act, 1983, Common Area collectively belongs to apartment owners in Group Housing Society. This fact is being repeated in various High Court and Supreme Court Judgments. So, ONLY RWA formed by apartment owners can allocate parking space to residents. So, they can't SELL nor ALLOCATE parking spaces. Only exception is basement parking where builders are allowed to sell since builders do construction for that.

[rtiwari2k7]

Dear Dheeraj,
Builders are charging as open parking and covered parking space. Please suggest what action should we take?

Regards
Rajeev Tiwari

[naveenarichwal]

Legal notice and if no response Consumer court is the solution to this cheating by these white collar dacoits.

[dheerajjain]

Source: Federation of Apartment Owners Association (http://www.faoindia.org)

DTCP has also said in its RTI reply that Parking can't be sold. Please find attached. Then, what is preventing DTCP from taking action against builders who are selling parking.