A Bill recently passed by the Karnataka Assembly has brought a degree of relief to flat owners who have had to deal with ambiguities in their rights and responsibilities in a shared property. The Karnataka Apartment (Ownership and Management) Bill, which rationalises two earlier statutes, has largely been welcomed by apartment owners and associations in the state’s fast-growing cities. It proposes to expand the law’s purview to integrated townships, high-rises, mixed-use complexes and gated communities. The clarity was a longstanding demand of dwellers who had little say in builders’ plans and were plagued by inconsistencies in rules.
The Bill addresses issues such as ownership and use of common areas, calculation of maintenance fees, enforcement of bylaws and resolution of community disputes. It mandates the builder to hand over common areas and their management to an elected association. Community and commercial facilities would be reserved for the exclusive use of apartment owners and dwellers. Importantly, it considers future development following changes in floor area ratio and zonal regulations, and the use of terraces for which the rights earlier were presumed to remain with the developer. Alterations and redevelopment would now require the consent of at least three-fourths of owners in a housing complex. The Bill also requires promoters to disclose mortgages taken on the project land, which frees buyers from liabilities before the property is transferred.
Until now, urban societies were governed by two 1972 Acts in managing apartments before and after construction. Builders took advantage of the previous laws’ loopholes to construct ‘builder floors’, illegal additions with dubious documentation, or commercialise the common area. The undivided land share remained unspecified, allowing the developer to put up more structures and reduce the owners’ rightful share of land. Now, the onus would be on the builder to ensure structural safety, obtain occupancy certificates, form an apartment owners’ association within three months, execute transfer deeds and hand over corpus funds and security deposits. Failure to comply could attract penalties.
While a few land rights activists claim the Bill does not fully comply with the Real Estate (Regulation and Development) Act, 2016 and should be challenged in court, apartment buyers can rest easier that the new law, coupled with RERA, would put them in a far safer legal ground.