• 1. Indemnity Clause — Protects the buyer against defects in title or future legal disputes.
• 2. Force Majeure — Defines “acts of God” that allow builders to delay without penalty. Ensure it isn’t overly broad.
• 3. Specific Performance & Termination — Outlines the exact refund mechanism (with interest) if the builder defaults.

Under Section 18 of RERA, if the promoter fails to give possession, the buyer has two options:

• Withdraw: Full refund plus interest at a prescribed rate (usually SBI MCLR + 2%).
• Stay in the project: Entitled to interest for every month of delay until possession is handed over.

Per RERA, only Carpet Area is the legal metric for sale. Selling on “Super Built-up” (which includes common areas like lift shafts and lobbies) is now a regulatory violation. The loading factor can often inflate the quoted area by 25–35%, meaning buyers could be paying lakhs for space they never use privately.

• Allotment Letter: Conditional offer to allot a specific unit.
• Agreement for Sale (AFS): The legally binding contract under Section 13 of RERA.
• Sale Deed: The final document that transfers Title from builder to buyer upon project completion.

Skipping the AFS eliminates your right to seek Specific Performance in court if the seller backs out for a higher offer.

Check the Commencement Certificate (CC) and the Intimation of Disapproval (IOD). Cross-verify the RERA registration number on the state’s RERA portal to compare sanctioned plans vs. proposed plans. This takes minutes and can save crores.

Homebuyers are classified as Financial Creditors under the Insolvency and Bankruptcy Code (IBC). They have a seat on the Committee of Creditors (CoC) and can vote on resolution plans if a builder goes bankrupt. This was a landmark amendment that significantly strengthened buyer rights.

In law, a brochure is merely an “Invitation to Offer.” Watch out for:

• Proposed amenities — Visual renders of lush forests or pools marked as “artist’s impression” have no legal binding unless in the RERA Sanctioned Plans.
• Soft/Pre-launch promises — Any verbal promise before RERA registration is legally void. Under Section 3, builders cannot even advertise without a registration number.
• FSI / View promises — Unless the builder has surrendered development rights on adjacent plots, they can build another tower right in front of yours.

A sanction letter is a conditional offer, not a guarantee of funds. Key hidden conditions include:

• NOC from Society/Land Authority: Many banks won’t disburse final payment without an original NOC from the Co-operative Housing Society.
• Tripartite Agreement: For under-construction property, a signed agreement between Buyer, Builder, and Bank is required — format mismatches can halt disbursement.
• Pre-disbursement Conditions (PDC): You must prove your entire “own contribution” is paid before the bank releases a single rupee. Don’t forget Stamp Duty and Registration charges count as part of this.

RERA Protects Against:

• Fund Diversion: Builders must deposit 70% of collected funds into a dedicated Escrow Account (Section 4(2)(l)(D)).
• Structural Defects: 5-year defect liability from possession date (Section 14(3)).
• Ad-hoc Plan Changes: Written consent of two-thirds of allottees required for any changes.

RERA Does NOT Cover:

• Pre-RERA legacy projects (completed before enactment).
• Subjective “aesthetic” quality (paint shade, tile brand) unless explicitly in the AFS.
• Internal family/co-owner disputes — those remain in Civil Courts.

A buyer should trace the Chain of Documents for at least 30 years. This ensures no “reversionary interests” or ancient claims on the land remain unresolved. Anything less is a risk.

Issued by the Sub-Registrar’s office, the Encumbrance Certificate (EC) lists all registered transactions and liens on a property. However — critical limitation — it does not show equitable mortgages (loans where only original title deeds are deposited with a bank without formal registration). Always conduct a physical title search alongside the EC.

No. A No Objection Certificate (NOC) from a Housing Society is an administrative requirement for share transfer, but it does not replace a registered Sale Deed. The Deed is what actually conveys legal ownership. Many buyers have lost property by confusing the two.

Under Section 195 of the Income Tax Act, the buyer must deduct TDS at a much higher rate (often 20% + surcharge/cess) compared to the standard 1% for resident Indians — unless the seller provides a Lower Tax Deduction Certificate from the Income Tax department. Missing this step makes the buyer liable for the shortfall.

The Risk: Under the doctrine of Lis Pendens, any transfer is subservient to the final court decree. Even if you paid full market value, if the court rules the seller lacked the right to sell, your sale can be declared null and void.

The Remedy: Before signing, conduct a Search Report at the Sub-Registrar’s office AND check the e-Courts services database against the seller’s name and property description.

Ensure the POA is Irrevocable, registered, and that the “Principal” (owner) is still alive. A POA is automatically revoked upon the death of the grantor — meaning a sale executed after the owner’s death is legally void, even if the buyer was unaware.

Buying without an Occupancy Certificate (OC) is a “Possession at Risk.” The building is technically unauthorized, and the local municipality can cut water and electricity supply or levy heavy penalties. The risk is not hypothetical — it has happened across several Mumbai suburbs.

Legally, these charges are “attached” to the property, not the individual. The Society or Municipality will recover unpaid dues from you, the new owner.

• Demand a No Dues Certificate (NDC) from the Housing Society plus latest tax paid receipts.
• Include a “Clearance of Arrears” clause in your Sale Deed stating the seller is liable for all outgoings until the date of possession.
• Consider withholding a small “Holdback” amount from final payment until the Society confirms all dues are cleared.

• Agreement for Sale (AFS): An Executory Contract. It creates a right to obtain the deed but does not transfer ownership.
• Sale Deed: The Executed Document that actually transfers “Right, Title, and Interest” from seller to buyer.

Skipping the AFS removes your right to seek Specific Performance — forcing the seller to complete the sale if they receive a higher offer midway through.

• Before Registration: You can walk away, but will likely forfeit your Earnest Money Deposit (EMD). If the seller backs out, they must return the deposit plus an equal penalty amount.
• After Registration: Once the Sale Deed is registered at the Sub-Registrar’s office, it is too late to simply “walk away.” To undo it, you must file a suit for Cancellation of Instrument in Civil Court — proving fraud, coercion, or total failure of consideration. A change of mind is not sufficient.

• MahaRERA (Maharashtra) — Widely regarded as the Gold Standard. First to implement QR codes for project tracking.
• GUJRERA (Gujarat) — Known for high digital transparency and strict quarterly project updates.
• K-RERA (Karnataka) — 80% complaint disposal rate in the Bengaluru market.
• UP RERA — Among the most aggressive in penalizing non-compliant promoters handling Noida/Greater Noida legacy disputes.

Sellers often use the “Circle Rate” (Ready Reckoner) to under-report property value. The hidden risk for buyers: under Section 56(2) of the Income Tax Act, the difference between market value and the declared value can be taxed as “Income from Other Sources” in the buyer’s hands — a tax the buyer never planned for.

For properties of ₹50 lakh or more, the buyer must deduct 1% TDS and file Form 26QB. Failure carries:

• 1% per month interest from the date TDS was deductible to actual deduction.
• 1.5% per month interest from deduction date to payment to government.
• ₹200 per day late filing fee under Section 234E.
• Penalty of ₹10,000 to ₹1 lakh under Section 271H.

• Under-construction property: 5% GST (standard) or 1% (affordable housing).
• Ready-to-move (with OC): 0% GST. This is why OC-certified projects command a premium.

Statutory mandate: 60 days (Section 29(4)). Realistic timeline in high-volume states: 6 to 9 months for a final order. If it escalates to the Real Estate Appellate Tribunal (REAT), add another 6–12 months.

Obtaining an Order: Very High probability for clear-cut delay/defect cases. Executing the Order: Moderate to Low. Recovery via Recovery Certificates issued to District Collectors often hovers between 15–20% in major cities — the “final mile” problem of RERA.

• Commencement Certificate (CC): Permission to start construction.
• Occupancy Certificate (OC): Certification that the building is fit for human habitation and matches sanctioned plans. Living in a flat without an OC is a legal violation in most municipal jurisdictions.

The Mother Deed — the parent document tracing the original land ownership. Without it, the entire chain of title is suspect.

Banks prioritize their security interest. They may overlook minor title flaws that could haunt a buyer for decades.

Hire a Property Lawyer. Always.

Mandatory “Time-Bound Execution” of RERA Recovery Certificates.

Currently, RERA passes excellent orders, but when a developer refuses to pay, the Recovery Certificate goes to local Tehsildar or District Collectors who are already overburdened — these certificates gather dust.

We need a dedicated Enforcement Wing within RERA, similar to how the Income Tax department or banks (under SARFAESI Act) have their own recovery mechanisms — ensuring a “victory” on paper translates into actual money in the buyer’s account.

For anyone navigating property law complexities, especially in the Mumbai or Pune jurisdictions, connect via:

• 🌐 www.concretetruths.com