FIR cannot be filed under MOFA

By Dr Sanjay Chaturvedi

Maharashtra Ownership Flat Act

Before we go into the criminal and civil liabilities let’s examine the provision of Section 3 of MOFA as to the Liabilities and Duties of Builder / Promoter

SECTION 03: GENERAL LIABILITIES OF PROMOTER

(1) Notwithstanding anything in any other law, a promoter who intends to construct or constructs a block or building of flats, all or some of which are to be taken or taken on ownership basis, shall in all transactions with persons intending to take or taking one or more of such flats, be liable to give or produce, or cause to be given or produced, the information and the documents hereinafter in this section mentioned.

(2) A promoter, who constructs or intends to construct such block or building of flats, shall–

(a) make full and true disclosure of the nature of his title to the land on which the flats ale constructed, or are to be constructed, such title to the land as aforesaid having been duly certified by an Attorney-at-law, or by an Advocate of not less than three years standing, have been duly entered in the property, card or extract of Village Forms V or VII and X or any other relevant revenue record;]

(b) make full and true disclosure of all encumbrances on such land, including any right, title, interest or claim of any party in or over such land;

(c) give inspection on seven days’ notice or demand, of the plans and specifications of the building built or to be built on the land; such plans and specifications having been approved by the local authority which he is required so to do under any law for the time being in force;

(d)disclose the nature of fixtures, fittings and amenities (including the provision for one or more lifts) provided or to be provided;

(e) disclose on reasonable notice or demand if the promoter is himself the builder, the prescribed particulars as respects the design and the materials to be used in the construction of the building, and if the promoter is not himself the builder disclose, on such notice or demand, all agreements (and where there is no written agreement, the details of all agreements) entered into by him with the architects and contractors regarding the design, materials and construction of the buildings;

(1) specify in writing the date by which possession of the flat is to be handed over (and he shall hand over such possession accordingly);

(g)prepare and maintain a list of flats with their numbers already taken or agreed to be taken, and the names and addresses of the parties and the price charged or agreed to be charged therefore, and the terms and conditions if any on which the flats are taken or agreed to be taken;

(h) state in writing, the precise nature of the organisation of persons to be constituted and to which title is to be passed, and the terms and conditions governing such organisation of persons who have taken or are to take the flats;

(i) not allow persons to enter into possession until a completion certificate where such certificate is required to be given under any law, is duly given by the local authority (and no person shall take possession of a flat until such completion certificate has been duly given by the local authority);

These words are added by Mah. 36 of 1986, s, 3(a).

(j) make a full and true disclosure of all outgoings (including ground rent, if any, municipal or other local taxes, taxes on income, water charges and electricity charges, revenue assessment, interest on any mortgage or other encumbrances, if any);

(k) make a full and true disclosure of such other information and document; in such a manner as may be prescribed; and give on demand true copies of such of the documents referred to in any of the clauses of this sub-section as may be prescribed at a reasonable charge therefore;

1[(l) display or keep all the documents, plans or specifications (or copies thereof referred to in clauses (a), (b) and (c), at the site and permit inspection thereof to persons intending to take or taking one or more flats;

(m) when the flats are advertised for sale, disclose inter alia in the advertisement the following particulars, namely –

(i) the extent of the carpet area of the flat including the area of the balconies which should be shown separately;

(ii) the price of the flat including the proportionate j of the common areas and facilities which should be shown separately, to be paid by the purchaser of flat; and the intervals at which the instalments thereof may be paid;

(iii) the nature, extent and description of the common areas and facilities; and

(iv) the nature, extent and description of limited common areas and facilities, if any.]

We have to also look at provisions of section 8 of MOFA which clearly states that in the event of failure to deliver the possession, a 9% simple interest along with principle may be levied. Read the provisions of section 8 as under :

SECTION 08: REFUND OF AMOUNT PAID WITH INTEREST FOR FAILURE TO GIVE POSSESSION WITHIN SPECIFIED TIME OR FURTHER TIME ALLOWED If

(a) the promoter fails to give possession in accordance with the terms of his agreement of a flat duly completed by the date specified, or any further date or dates agreed to by the parties, or

(b) the promoter for reason beyond his control and of his agents, is unable to give possession of (he flat by the date specified, or a further agreed date and a period of three months thereafter, or a further period of three months if those reasons still exist, then, in any such case, the promoter shall be liable on demand (but without prejudice to any other remedies to which he may be liable) to refund the amounts already received by him in respect of the flat (with simple interest at nine percent per annum from the date he received the sums till the date the amounts and interest thereon is refunded), and the amounts and the interest shall be a charge on the land and the construction if any thereon in which the flat is or was to be constructed, to the extent of the amount due, but subject to any prior encumbrances.

Now, the section say “but without prejudice to any other remedies to which he may be liable”. We shall examine in which circumstances external remedies may be revoked. Under Section 13 and 13A, the offence got remedies. The provisions read as under :

SECTION 13: OFFENCES BY PROMOTERS

(1) Any promoter who, without reasonable excuse, fails to comply with, or contravenes,the provisions of section 3,4, 5 (save as provided in sub-section (2) of this section), 10 or 11 shall, on conviction, be punished with imprisonment for a term which may extend to three years or with fine, or with both.

(2) Any promoter who commits criminal breach of trust of any amount advanced or deposited with him for the purposes mentioned in section 5 shall, on conviction, be punished with imprisonment for a term which may extend to five years, or with fine, or with both.

(3) Any promoter who, without reasonable excuse, fails to comply with, or contravenes, any other provision of this Act or of any rule made thereunder, shall, if no other penalty is expressly provided for the offence, be punished, on conviction, with imprisonment for a term which may extend to one year, or with fine which may extend to ten thousand rupees, or with both.

SECTION 13A: POWER OF MAGISTRATE TO PASS SENTENCES UNDER THIS ACT

Notwithstanding anything contained in the Code of Criminal Procedure, it shall be lawful for a Metropolitan Magistrate or a Judicial Magistrate of the First Class to pass on any person convicted of any offence under this Act a sentence of imprisonment or of fine or both as provided in the relevant section of this Act, in excess of his powers under section 27 of the said Code.]

A circular cannot supersede an Act. A circular which was circulated on social media as claimed, issued by Police Commissioner as to record FIR against errant builders, if it is original, cannot over rule Act which specifically give power to Metropolitan Magistrate under section 13A. Police only got power to record FIR and register a case against builder. But it is prerogative of court to decide the matter under MOFA.