Residents of Campa Cola in Mumbai have got relief from demolition, eviction till May 2014 . Problem in the case of Campa Cola flats was that the municipal corporation, Brihanmumbai Municipal Corporation (BMC), had not granted an occupation certificate (OC) to some of the flats as builder had not taken approval for them. This means residents did not have a valid certificate from the municipal body. If buyers are not careful about legal procedures and approvals, they may may be in the same boat as these residents. Let’s look at the Campa Colo case and what is the importance of Occupancy Certificate
Campa Cola Flats Demolition
Campa Cola complex in in upscale Worli area was developed between 1980 and 1989 by PSB Construction Company, B.Y. Builders and Yusuf Patel. The Brihanmumbai Municipal Corporation(BMC) had allowed construction of six stories but the developers built 16 to 20 floors.The Brihanmumbai Municipal Corporation (BMC), also known as the Municipal Corporation of Greater Mumbai (MCGM) or the Bruhanmumbai Mahanagar Palika, is the civic body that governs the city of Mumbai and is India’s richest municipal organization. The BMC then issued notice to the builders in 1984 to stop work after it found irregularities in construction. The builders finished their work after paying the fine. The flats were subsequently sold and buyers occupied the flats. 102 flats (some reports say 96 flats) in the compound have been constructed without approval. Occupants have been issued eviction notices as they do not have an Occupation Certificate (OC).
Why now? The Municipal Corporation of Greater Mumbai (MCGM) too had turned a blind eye all these years. But trouble started when the residents dragged the municipality to court over non-supply of water. The officials, when pulled up, told the court that the structures were illegal. They later issued eviction notices to the residents, but took no action against the builder. The residents challenged the MCGM’s notice and subsequently approached the Supreme Court which only stayed the demolition drive till November 11. It also allowed the residents to seek regularisation from the appropriate authorities. Asked why no action was taken in the past, MCGM officials were threatened by the underworld in 1980s against taking any action. Let’s see how the timeline
- The Municipal Corporation of Greater Mumbai (MCGM) had not provided them Occupation Certificate or Occupancy Certification and water supply for all these years. The buildings have been ordering water tankers since 1989.
- Residents have been paying property tax all these years.
- The court on 27 February had ordered the Brihanmumbai Municipal Corporation (BMC) to demolish the illegally constructed flats and on 1 October refused to re-consider its earlier order and had set 11 November deadline to vacate 102 flats which were declared as illegal.
- On 13 November, hours after over 100 agitated families clashed with the police while the civic squad was bulldozing its way into the premises, the apex court had stayed the demolition.
- The Supreme Court asked the unauthorised flats owners at the Campa Cola society in Mumbai to vacate the premises by 31 May 2014 as no specific proposal could be worked out to provide them space in the compound for new construction.
Campa Cola Residents anguish
- The residents asked why they were being singled out when more than 55,000 buildings in the city had no OC.
- “We do not agree that the floors are illegal. We have been paying property tax for years now. At best, there is irregularity. Why did the government accept tax from us if our structures were illegal.
- While the residents said that the MCGM should take the permissible FSI (Floor Space Index) into consideration before deciding the illegality. “The builders were given permission to construct five floors. But we have FSI for 91,000 square feet, which means only 21,000 square feet are illegal. Those will be 19 flats. We are okay if the authorities pull down those flats
- Many residents expressed anguish at how the civic body let the builders go scot-free.
- The residents alleged that the civic body wanted to vacate them at the behest of vested private interest. “Krishna developers which has bought over the rights from Pure Drinks, wants to construct a five-star hotel here. He wants us out. Another plush residential complex is coming up around 500 metres from here and that builder wants a stretch of our land to construct a good approach road,
- The real estate prices in the area are one of the highest in the city.
Jayant Tipnis, who was once engaged as the architect for the Campa Cola compound, had tried several times to get the project regularised. “I approached the municipality several times with new plans, but they were rejected. I approached three Chief Ministers, but that too did not work. By then the builders had already sold the flats and were not really interested in pushing the matter.
Did the residents know that flats were illegal. Yes those you bought knew as they got it at low cost.
Why paying Property Tax or having water connection not sufficient?
The BMC provides services to citizens in Mumba and has to pay its bills. Property tax is one source of income for the BMC. And that is why the Campa Cola compound residents didn’t have to pool their garbage everyday and arrange for a private truck to lug it to faraway garbage dumps but simply depend on the BMC to do the job. Or take street lighting on the roads leading to the Campa Cola Compound. Or the roads itself.
And neither is a BMC water connection proof of legitimacy of a property. The BMC provides connections to buildings in Mumbai without an Occupation Certificate on a humanitarian basis and charges nearly double for such water supply.
Ref: First Post The Campa Cola case: Separating truth from fiction
Basic Documents during and after construction
Few basic documents that come before construction and a few after are given below. The you can find the entire process for in detail at DoingBusiness Dealing with Construction Permits in Mumbai – India , for Delhi
- The first is the Intimation of Disapproval (IoD), which is issued by municipal corporation and includes a list of no-objection certificates (NOCs) which the applicant must obtain separately from various departments and government authorities. For example Environment clearance, aviation clearance, fire safety clearance, approved plans, etc., are all required before a developer can start construction. This becomes important when the developers start selling the project even before receiving the Commencement Certificate .
- Once this is done, a Commencement Certificate (CC) is issued in stages, usually first for the plinth level, then for a few floors at a time (say for up to third floor, then seventh floor, and so on). Commencement Certificate is the permission given by the local municipal authority to the developer to start construction, after it is satisfied that the developer has received all the clearances and approvals.
- Once the building is complete, the architect applies for an Occupation Certificate (OC) after obtaining a set of no-objection certificates (NOCs) from various departments and after that a Building Completion Certificate (BCC) is issued.
Typically Documents for purchase of flat from a builder (Ref Hindu Documents to bag home loan)
Documents for buying property
- Title deeds of the site/plot i.e., sale deed in favour of the loan applicant and prior link title deeds tracing the ownership of the property for a period of 30 years, at least 13 years.
- RTCs/RORs are also to be submitted wherever applicable.
- 7/12 extract or property register card of the land under construction.
- Copy of N.A. permission for the land from the Collector.
- Development agreement between the owner of land and the builder.
- Copy of order under the Urban Land Ceiling Act.
- Latest receipts of taxes paid.
- Commencement certificate granted by the Corporation.
- Documents if the construction is on own land:
- Title deeds of the property, i.e. sale deed in favour of the present owner and prior link sale deeds tracing the ownership of the property for a period of 30 years, atleast 13 years.
- Conversion/alienation order from competent authority for conversion of agricultural land for residential purpose.
- Encumbrance Certificate/Search Report for the past 30 years, at least 13 years.
- Up to date tax/lease rent paid receipts of the property.
- 7/12 extract or property register card in your name.
- Sanctioned building plan and license for construction from competent authority.
- Development Agreement/Power of Attorney between the builder and land owner, if applicable
- Necessary Permission from various local authorities like Electricity Board, Water Supply Board, Airport Authority etc., is to be furnished
- Agreement of sale/ agreement for construction in favor of the applicant, showing details of estimate or the different stages of payments as the case may be.
Occupation Certificate or Occupancy Certificate
Once the building is complete, the builder has to obtain an Occupation Certificate, which certifies that the building has complied with the approved plans.
- Only once the OC is issued can flat owners occupy the apartments as per law, as otherwise the building is considered illegal. A new flat owner should insist on an OC from the builder before moving in.
- Corporation can also initiate action against the flat owners, as the law says no person can move into a building without OC. Many builders do not bother to get OC and often new flat owners move into flats in a hurry once the construction is complete.
- If your building does not have an OC : Residents can approach the Muncipal Corporation, seek regularisation of the plans, comply with the norms. However, the law says that if the building has been constructed without any plans it cannot be regularised.
Sample images of Occupation Certificate of Mumbai from Apartmentadda Completion Certificate and Occupancy Certificate (click on image to enlarge)
Occupancy Certificate
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To avoid a Campa Cola-like situation is to be careful while purchasing a flat. Check the documents such as Occupation certificate. Did you check the documents before buying a house? What other things should one check for?
Thanks. This is very much informative, most of them are not aware of this documents
As I’m interested in purchasing a “clean property” in Bangalore – that which has a CC and a OC, I ask the Builders to provide a “OC clause” in the Sale Agreement that penalizes them against violation/deviations. I put the clause below – so as to spread awareness among other buyers too!
“Occupancy Certificate:
A) That the Builder has/is hereby committed to hand over a copy of the Occupancy Certificate issued by the Municipal Corporation for the , to the Purchaser on or before _ ___ . That if the Builder fails to meet such commitment, the same date shall be deemed as date of default of handing over of the Occupancy Certificate by the Builder.
B) That the Builder before or after acquiring the Occupancy Certificate from the Municipal Corporation, shall not add or alter materially, the structure or a part of the structure thereof for without specific permission of the Municipal Corporation OR default on any of the conditions mentioned in the Occupancy Certificates, including but not limited to adding more floors other than that approved by Municipal Corporation OR constructing any more saleable area in addition to that approved by Municipal Corporation, OR altering the use of terraces or water bodies or roads inside the project, thereby rendering the Occupancy certificate(s) cancelled or withdrawn by the Municipal Corporation. The date on which the Builder performs such deviation, thereby rendering any of the Occupancy certificate(s) cancelled or withdrawn by the Municipal Corporation, shall be deemed as date of default by the Builder for this clause.
C) That the Builder, in the event of any of the defaults mentioned in A) or B), shall pay to the Purchaser, inspite of arbitration clause,:
i) one time penalty of 30% of the the amount mentioned as sale price for sale of Property, as damages towards loss of property valuation due to irregularized building AND in addition,
ii) 18% per annum of the the amount mentioned as sale price for sale of Property, from the date of default, whichever date is the earliest default applicable in A) OR B) to the date such irreguarized building is regularized by the Builder at is cost.”
Disclaimer: I still have to come across ONE Builder in Bangalore, who has agreed to my OC clause in the sale agreement. There are many who verbally make tall claims of providing an OC – but once they read about the OC clause – they stop responding to my emails 🙂
Informative blog post. Thanks for sharing this helpful information about residential property. I truly appreciate your efforts and I am waiting for your Further post thanks once again.
Thanks for a very educative article!
No matter how vigilant you try to be builders, no matter big or small, reputed or un-reputed, make you miss out on something making your flat purchase experience displeasurable, dissatisfying.
In the list of documents you provided above, if I go to buy under-construction property, does commencement certificate supersede all the other documents (NA order, plan approval, land ownership, etc.)? SImilarly, if I go to buy a ready possession flat, does occupancy certificate supersede all the prior documents and I need not worry about it?
Thanks!
Thanks.
It is easier said than done. I cannot blame people moving in without proper documentation as sooner or later things get sorted out is the belief.
Had residents not filed case for water they would not have to face this. Even now they have support of politicians. Let’s see how the things progress.
Hope it makes people aware…
Yes it seems so that commencement certificate for under construction flat means other paper work is done. And Occupancy certificate(along with sale deed) for resale flat.
As mentioned Few basic documents that come before construction and a few after can be found in in detail at DoingBusiness Dealing with Construction Permits in Mumbai – India and for other places at Doing Business website
Thanks for a very educative article!
No matter how vigilant you try to be builders, no matter big or small, reputed or un-reputed, make you miss out on something making your flat purchase experience displeasurable, dissatisfying.
In the list of documents you provided above, if I go to buy under-construction property, does commencement certificate supersede all the other documents (NA order, plan approval, land ownership, etc.)? SImilarly, if I go to buy a ready possession flat, does occupancy certificate supersede all the prior documents and I need not worry about it?
Thanks!
Thanks.
It is easier said than done. I cannot blame people moving in without proper documentation as sooner or later things get sorted out is the belief.
Had residents not filed case for water they would not have to face this. Even now they have support of politicians. Let’s see how the things progress.
Hope it makes people aware…
Yes it seems so that commencement certificate for under construction flat means other paper work is done. And Occupancy certificate(along with sale deed) for resale flat.
As mentioned Few basic documents that come before construction and a few after can be found in in detail at DoingBusiness Dealing with Construction Permits in Mumbai – India and for other places at Doing Business website
A much needed respite but its still a big headache for the people and their safety.
A much needed respite but its still a big headache for the people and their safety.
I am not discounting the fact that residents need to be vigilant about documents and law.
but, you know what the irony is?
1. I did not see the name of builder surface in all this drama in last couple of weeks. Not even once. Why?
2. No law makes it a builder’s obligation of obtaining an OC. Why does the law expect he buyers have to push builder for it then? Why is the buyer at builder’s mercy to get an OC after the project completion?
Why it is so easy for builders to get away with the project violations?
Why is no media talking about all this?
Builder politician nexus is just too strong for a mango man to be able to fight with. Even the media is not spared.
That’s what the anguish of Campa Cola residents was. Builder has simple washed hands.
Quoting from article
The residents asked why they were being singled out when more than 55,000 buildings in the city had no OC.
Many residents expressed anguish at how the civic body let the builders go scot-free.
The residents alleged that the civic body wanted to vacate them at the behest of vested private interest. “Krishna developers which has bought over the rights from Pure Drinks, wants to construct a five-star hotel here. He wants us out. Another plush residential complex is coming up around 500 metres from here and that builder wants a stretch of our land to construct a good approach road,
There is a saying in Hindi, “chahe chaooko tarbooz par pade ki tarbooz chako pein katna to tarbooz ko hi hai” (water melon is one that gets cut irrespective of whether knife falls on it or water melon falls on knife)
Life is not fair. Let’s hope that some day these things would get regularised.
I am not discounting the fact that residents need to be vigilant about documents and law.
but, you know what the irony is?
1. I did not see the name of builder surface in all this drama in last couple of weeks. Not even once. Why?
2. No law makes it a builder’s obligation of obtaining an OC. Why does the law expect he buyers have to push builder for it then? Why is the buyer at builder’s mercy to get an OC after the project completion?
Why it is so easy for builders to get away with the project violations?
Why is no media talking about all this?
Builder politician nexus is just too strong for a mango man to be able to fight with. Even the media is not spared.
That’s what the anguish of Campa Cola residents was. Builder has simple washed hands.
Quoting from article
The residents asked why they were being singled out when more than 55,000 buildings in the city had no OC.
Many residents expressed anguish at how the civic body let the builders go scot-free.
The residents alleged that the civic body wanted to vacate them at the behest of vested private interest. “Krishna developers which has bought over the rights from Pure Drinks, wants to construct a five-star hotel here. He wants us out. Another plush residential complex is coming up around 500 metres from here and that builder wants a stretch of our land to construct a good approach road,
There is a saying in Hindi, “chahe chaooko tarbooz par pade ki tarbooz chako pein katna to tarbooz ko hi hai” (water melon is one that gets cut irrespective of whether knife falls on it or water melon falls on knife)
Life is not fair. Let’s hope that some day these things would get regularised.
Well-written article. Understood the issue for the first time.
Mumbai should have woken up by now. No one should dare buy a flat in a building which does not have an Occupancy Certificate. If I understood correctly, if the building has obtained an Occupancy Certificate from the Municipal Corporation, all the previous formalities must have been completed. Am I right?
The way people buy property in Mumbai, it can be really suicidal! People don’t delve deep before zeroing in on a property, merely on the advice of local property agents. Kirti, they don’t check the necessary documents. They see things like locality, proximity to a school or railway station, “quality” of the neighbours, and trust me, they even consider if the sanitary ware is of Cera and if the water-fittings are of Jaguar!
Excellent write-up and I feel compelled to offer you another topic for your blog: “Lease-hold versus Free-hold property”. Did you know that the days of 99-year property leases may be passe and the Municipal Corporation in Mumbai has started leasing property to developers for a mere 30 years? Now, imagine I purchase a flat in a building which is built on a land whose lease will expire in another 5 years, and I don’t even know that the land is lease-hold! What if the lease is not extended? What if the land-owner decides to increase the lease amount 10-fold? I may have purchased the flat for a crore, but when it comes tumbling down, the lessor is not obliged to compensate me. Imagine!
Thanks Kapil. I also understood the issue while writing it.
It’s not Mumbai but a problem of real estate throughout India take Banaglore, Delhi
Thanks for the topic Lease-hold versus Free-hold property, didn’t know that leasing period is reduced to 30 years. Let me see if we can come up with something on the suggested topic.
Well-written article. Understood the issue for the first time.
Mumbai should have woken up by now. No one should dare buy a flat in a building which does not have an Occupancy Certificate. If I understood correctly, if the building has obtained an Occupancy Certificate from the Municipal Corporation, all the previous formalities must have been completed. Am I right?
The way people buy property in Mumbai, it can be really suicidal! People don’t delve deep before zeroing in on a property, merely on the advice of local property agents. Kirti, they don’t check the necessary documents. They see things like locality, proximity to a school or railway station, “quality” of the neighbours, and trust me, they even consider if the sanitary ware is of Cera and if the water-fittings are of Jaguar!
Excellent write-up and I feel compelled to offer you another topic for your blog: “Lease-hold versus Free-hold property”. Did you know that the days of 99-year property leases may be passe and the Municipal Corporation in Mumbai has started leasing property to developers for a mere 30 years? Now, imagine I purchase a flat in a building which is built on a land whose lease will expire in another 5 years, and I don’t even know that the land is lease-hold! What if the lease is not extended? What if the land-owner decides to increase the lease amount 10-fold? I may have purchased the flat for a crore, but when it comes tumbling down, the lessor is not obliged to compensate me. Imagine!
Thanks Kapil. I also understood the issue while writing it.
It’s not Mumbai but a problem of real estate throughout India take Banaglore, Delhi
Thanks for the topic Lease-hold versus Free-hold property, didn’t know that leasing period is reduced to 30 years. Let me see if we can come up with something on the suggested topic.
I dread to think about the plight of those residents. The most harrowing experience of their lives!
Yes the residents had a harrowing experience and even Supreme court sympathised with them. But it is a fact that they do not have occupancy certificate which is a proof of legal ownership. But then so many other people also don’t have it.
How the matter will resolve the time will tell
Kirti, when a poor upcountry immigrant to Mumbai purchases a “unit” in a chawl or slum, after shelling out his life savings of Rs.10 lakhs or so…and the entire structure is not “legal”, imagine his plight!
I dread to think about the plight of those residents. The most harrowing experience of their lives!
Yes the residents had a harrowing experience and even Supreme court sympathised with them. But it is a fact that they do not have occupancy certificate which is a proof of legal ownership. But then so many other people also don’t have it.
How the matter will resolve the time will tell
Kirti, when a poor upcountry immigrant to Mumbai purchases a “unit” in a chawl or slum, after shelling out his life savings of Rs.10 lakhs or so…and the entire structure is not “legal”, imagine his plight!