Free Press Journal

RERA and MOFA clauses differ from each other, say developers


Mumbai  : Following the rollout of the Real Estate Regulatory Authority (RERA) act, there has been a major change in the clauses of flat ownership agreements. With RERA chief Gautam Chatterjee suggesting a repeal in the amendment of Maharashtra Ownership Flat Act (MOFA) and the ongoing implementation of RERA in the real estate sector, it is likely to pose as a problem since rules mentioned in the act marginally contradict each other.

Chaterjee had said that such an act could cover projects that do not require registration and will be outside the reach of RERA. Speaking to Free Press Journal, Sukhraj Nahar, chairman and managing director of Nahar Group, said that MOFA being a stringent act with criminal proceedings and RERA aiming to bring in discipline in the sector, amendment of both together will bring more trouble to the consumers and developers than gain.

In a similar incident, the Citizens’ Justice Forum, a non-governmental organisation, had written to Real Estate Regulatory Authority (RERA) pointing out specific clauses of a flat agreement that disempowers buyers from investing in the project.

The forum alleged that the developer, Ekta World, has asked buyers to falsely state that they have only paid 9.9% in the sale agreement. As per RERA, a promoter cannot accept more than 10% of the cost of the property, as an advance payment or an application fee, without first entering into a registered agreement for sale.

The forum said that another clause stated that if the buyer does not receive intimation that a particular stage of construction is completed, then the buyer cannot give an excuse for non-payment of any amount.

The developer sends intimation to the buyer which included detailed updates of construction of the project.

Such clauses are not RERA complaint and hence will not be accepted by the authority since it favours developers, says Sulaiman Bhimani, president of CJF.

He added, “The developers take advantage of flat buyers’ lack of knowledge on the proceedings. Now that RERA has been rolled out, such biased clauses should be excluded. Property buyers have always been fooled by the developers by overpricing, late possession, wrong information, exaggerated plot areas and such horrendous clauses in the sale agreement.”