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Karnataka RERA cracks down on developers not registering projects

Despite Karnataka High Court and KRERA rulings, homebuyers in the state claim several developers continue to issue partial occupation certificates’ for handing over the apartments.


The Karnataka Real Estate Regulation and Development Authority (KRERA) has ordered Bengaluru-based developer Ozone Urbana Infra Developers Private Ltd to register its project Urbana Serene in Devanahalli taluk under Section 3 of the Real Estate (Regulation and Development) Act, 2016.

The realtor has been instructed to register the project, envisaged as a senior living community, within two weeks after receiving the interim order, which was issued on September 22.

This comes after the Urbana Serene Apartment Owners Welfare Association complained that the developer was improperly collecting money before finalising the purchase agreement.

The order says, “The complainants also alleged that Ozone Urbana has not formed an association as per the existing provisions of law, but suo motu made Serene Senior Living Private Ltd the manager in the Deed of Declaration dated May 21, 2016, without the consent of the allottees.”

Since Urbana Serene has not yet been completed, the complainants have asked KRERA that it be declared an “ongoing project” and grant all the relief.

KRERA intervened and summoned representatives of the realtor and the complainants and asked them to submit the relevant documents. After going through the documents, KRERA found that Ozone Urbana had obtained an occupancy certificate from the Kannamanagala panchayat on August 16, 2017. The Serene Urbana//Urbana Serene// project was as on July 31, 2017, an ‘ongoing’ and incomplete project and hence attracts legal obligation to get registered under Section 3 of the RERA law, the order added.

Homebuyers welcome the order

In an earlier incident on August 19, KRERA had passed a similar order in the case of buyers of homes at Sobha City, a project by Sobha Ltd, in Bengaluru. According to the order, the builder did not complete the apartments by the promised date of 2015 and the complainant, an association of allottees, was forced to take possession in the same year even before getting the occupancy certificate (OC).

“Complainants have alleged they have frequent power disruption and shortage of water... Further allegations of the complainants include that on the basis of partial OC, the developer made the owner believe that it is a real OC and has compelled the allottees to carry out maintenance of the project without executing the conveyance deed of the property,” the document said.

KRERA had also directed the developer to register the project with it, obtain OC for the entire project and maintain the project at the developer’s cost.

Ameya Usgaonkar, a homebuyer, said, “Today we still have partial OC despite several high court and KRERA judgements.”

In a March 11 Karnataka High Court ruling in Total Environment Building vs Verghese Stephen, the court noted, “Learned counsel submitted that there is no concept of partial occupancy certificate under the Act.” Additionally, the court ruled, “The first is that no person shall occupy or let in any other person to the building or part thereof until an Occupancy Certificate to such a building or part thereof has been granted.”

Dhananjaya Padmanabhachar, sanchalak or director, Karnataka Home Buyers Forum, said the National Consumer Dispute Redressal Commission had ruled that homebuyers will be liable to pay maintenance charges for their flats only after the builder gets an OC from the civic authorities. “But in reality, homebuyers are forced by the builders in Bengaluru to pay the maintenance without OC. The RERA in Karnataka must pass an order to ensure the builders and the agency should not demand maintenance from the homebuyers without obtaining an OC,” he said.

Abhilash Naik, an advocate, added that in the case of Ozone Serene, it was possible that the developer had not updated documents submitted to KRERA. “All documents, permission from the government should be uploaded to KRERA. If the developer further fails to register the project within two weeks, KRERA can impose a penalty on them,” he said.A list of questions has been sent to Ozone Group and Moneycontrol will update the story after receiving a response.
Souptik Datta Sub Editor at Moneycontrol
first published: Sep 28, 2022 01:33 pm