Maharashtra Ownership Flats Act

About Maharashtra Ownership Flats Act :

What is MOFA?

MOFA stands for The Maharashtra Ownership Flats (Regulations of the Promotion of Construction, Sale, and Management & Transfer) Act, 1963.

 

What is the purpose of MOFA?

As there is an acute shortage of housing, this act was formed to protect one and all from sundry abuses, malpractices and difficulties relating to the promotion of, the construction of, and the sale and management and transfer of flats taken on ownership basis.

 

What does one have to know whilst purchasing an ownership flat?

It should be noted that MOFA has empowered the purchaser investing money in purchasing flats with powerful sections such as section 3, section 4, section 5, section 7, section 10, section 11, and section 13. It is an act where if promoter/builder commits breach, on conviction promoter/builder could be imprisoned and disqualified from undertaking construction of flats for a period of five years from the date of such conviction.

 

What is section 13 of MOFA?

If any promoter/builder violates section 3,4,5,10,11 of MOFA, on conviction will be punished with imprisonment for a term which may extend to three years or with fine, or with both and shall be disqualified from undertaking construction of flats for a period of five years from the date of such conviction.

 

What is the term Flat?

Term Flat means a separate and self contained set of premises used or intended to be used for residence, or office, or show-room or shop or go down.

 

Who is or what is the term promoter?

Promoter/builder is a person and includes a partnership firm or a body or association of persons taking the step towards construction of building or buildings on purchased land or plot and thereafter selling flats for a consideration.

 

What is a conveyance deed?

A conveyance deed is a very important document which transfers the title of land on which the flats have been constructed from the promoter/builder to the society. Till the conveyance deed is conveyed all open spaces, garden, parking, terrace, staircase, etc. remain in the possession of the promoter/builder.

 

What is section 3 of MOFA?

It is a section denoting general liabilities of the promoter, i.e.
  • A promoter is duty bound to disclose the title of the land on which flats are constructed or to be constructed and the same has to be duly certified by an Attorney-at-Law or Advocate of not less than three years standing
  • Make full & true disclosure of all encumbrances, including any right, title, interest or claim of any party on the proposed land where flats are or will be constructed.
  • Disclose the design and the materials to be used in the construction of the building.
  • Disclose the extent of carpet area and sell flat on the basis of carpet area only.
  • Disclose the nature of fixtures, fittings and amenities provided or to be provided.
  • Specify in writing the date by which possession of the flat is to be handed over.

 

What is section 4 of MOFA?

It is a section denoting registration of the agreement. A promoter/builder before accepting payment, which shall not be more than 20 percent of the entire sale price, is duty bound to enter into agreement and have it registered as per Registration Act. Only if the agreement is registered as per section 4 of MOFA can the Flat purchaser claim relief under MOFA. Flat purchaser’s, often over look registration aspect, and keep it pending till the very end, which could be detrimental in case the promoter/builder defaults.

 

What is section 5 of MOFA?

It is a section denoting that a promoter needs to maintain separate account of sums taken as advance or deposit, and to be a trustee and disburse the same for the purpose for which they are given. Meaning the advance collected from the flat purchasers need to be utilized only for constructing the particular flats as mention at the time of registering the agreement and not otherwise.

 

What is section 7 of MOFA?

It is a section denoting that after plans and specifications are disclosed, the promoter/builder cannot make any alterations or additions without written consent of persons who have agreed to take the flats. Furthermore after giving possession the promoter is liable to rectify the defects in construction as well as materials. It is usually assumed that once the possession is given or a society is formed the promoter/builder’s liability to rectify defects ceases.This is not the case, as the promoter/builder is liable to rectify defects three years from the date of possession under section 7 of MOFA.

 

What is section 10 of MOFA?

It is a section denoting that a promoter/builder is duty bound to take steps in formation of the co-operative society as soon as a minimum number of persons required to form a co-operative society come forward. There is a common misconception that, a promoter/builder will not hand over the control of the building/buildings to the society till all the flats are sold. Section 10 of MOFA clearly states that promoter/builder is duty bound in taking steps to form the society even if certain flats remain unsold. The time frame given is of four months, thereafter it would be termed as default under section 13 of MOFA, which on conviction could lead to imprisonment.

 

What is section 11 of MOFA?

It is a section denoting that a promoter is duty bound to complete his/her title and convey the same to the society by way of conveyance deed. The time frame given is of four months after formation of society, thereafter it would be termed as default under section 13 of MOFA, which on conviction could lead to imprisonment. If the promoter fails to convey the property to the society than the flat owners can go in for deemed conveyance, an alternate relief given under MOFA.

 

What is a deemed conveyance?

Deemed conveyance is a relief given to the flat purchasers under MOFA, to get the title of land on which the flats have been constructed directly registered in the name of society by approaching the competent authority.

 

What happens when promoter/builder fails to hand over the conveyance to the flat purchasers?

After the period of four months if promoter/builder fails to convey the property to flat purchasers, under Rule 9 of MOFA, promoter/builder has been committing breach of section 11 of MOFA, and as long as he/she continues to do so, it would amount to continued offence and, therefore the provisions of section 472 Cr. Pc. (Criminal Code of Procedure) will be attracted. S. Irani (Sorkhab) v/s Dinshaw & Dinshaw & others 1999 (Supp) Bom C.R. 320; 1999 (O) All. M.R. (Cri) 57; 1998 (O) Bom.L.R. 496

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