Importance of DoD in RWA voting

One of the most striking features of UP Apartment Act 2010 is the mandatory Deeds of Declaration (DOD) from the builder that discloses in writing the building(s) as well as the entire parcel of land to the residents

The recent Allahabad High Court order in the Purvanchal Silvercity II, Greater Noida, case has once again brought the Deeds of Declaration (DoD) in focus. Hon’ble Justice Suneet Kumar ruled that elections in the residential complex will be strictly based on DoD. So in case you thought the election to the apartment owners association was as simple as one person from one flat casting his/her vote, think again. The truth is each resident’s voting share depends on the size of the flat he occupies, besides the undivided share in common areas. Loosely translated, it means if you own a big size flat, your voting share will be more than your pal who lives in a smaller apartment. But what exactly is a DoD and why is it so important? It is basically the document by which the builder admits in writing (true disclosure) of what is built on site. It includes area statements regarding the apartments, common areas and facilities, independent and limited common areas and facilities and the details of the materials used for construction. It’s vide the Deed of Declaration that the builder also ‘conveys’ the building(s) as well as the entire parcel of land to the residents. It’s an important piece of document because it tells homeowners the exact layout plans of the plot and the promoter cannot change the scheme without the written consent of all the allottees. It also means that the apartment owners association also can’t decide with majority vote to build a temple or any other structure on common area without everyone’s consent. Just to add, none of the Noida developers have submitted a DoD to the authority. Neighbouring Indirapuram residents will also recall getting notices by the Ghaziabad Development Authority (GDA) in September last that their flats will be seized unless DoD were submitted to the civic agency. The notices took homeowners by surprise as the so-called deeds had to be submitted by their housing societies, not individual flats. But for the GDA, the move to serve individual notices was perhaps meant more as a pressure tactic. It worked, too, as developers of more than 50 housing societies quickly submitted the deeds. But why does the builder need to submit it to the authority?

The Backgrounder: Housing is a necessity for all human beings and it’s the government’s responsibility to provide shelter to all its citizens. However, the government being constrained by resources looks towards private developers to construct group housing complexes and condominiums by which everyone benefits – the citizens, the government (revenues by plot auction, FAR sale and stamp duty) and obviously the builders. We all know that the development authority is allotted land by the state government for urban development as per the approved master plan, which comprises residential, commercial, institutional, recreational, sports and green areas. The areas meant for residential development is auctioned at lower rates vis-à-vis area earmarked for commercial development. It is, therefore, expected that private builders will construct group housing projects and hand over the management of the buildings and parcels of land to the residents, represented by the Association of Apartment Owners or Residents Welfare Associations, and move out of the condominiums.

The provision for Deed of Declaration is stipulated under Section 12 of the UP Apartment Act, 2010, and governed under Rule 3 of the UP Apartment Rules, 2011, and it can only be amended with permission of Competent Authority under Rule 4 of 2011 Rules. The Hon’ble Allahabad High Court passed a landmark judgment under Civil Misc. Writ Petition 33826 of 2012 on 14.11.2013, which ironed out the creases for effective and expeditious implementation of 2010 Act in the state. The court has comprehensively dealt with the Deed of Declaration subject within the 14 conclusions it has drawn in paragraph 65 of the order.

Residents’ Rights

1. The Deed of Declaration is a must for securing the following rights of every resident:

a) Land Rights – i.e., undivided rights over parcel of land;

b) Voting Rights – proportionate to the builder’s sale deed value of the apartment (not the subsequent sale deed value).

2. Covered Area compliance: area mentioned in declaration and sale deed should be same. In case builder has erred, it can be amended under Rule 4 and only by consent of residents, the amendment can be finalized by the competent authority. For obvious vested commercial interests, builders will not willingly submit the Deed of Declaration. However, it is in the interest of residents that under the provision of UP Apartment 2010 Act and the High Court judgment, the development authority and the builder can be compelled to submit the declaration and protect the apartment owners’ statutory rights.

True disclosure of the project

According to the UP Apartment 2010 Act:
(2) Declaration has to be filed by all promoters within 12 months from the date of approval of building plan and within 90 days for constructed or under-construction buildings.
(3) Promoter cannot change the scheme without the written consent of all the allottees.
(1) The ‘competent authority’ includes vice chairman of the development or the collector of the district. In case of the industrial development authority the competent authority shall be the chief executive officer (CEO) of the industrial development authority.
(2) For the purposes of discharging functions and duties and resolving the disputes the competent authority will be entitled to delegate its powers to an officer not below the rank of joint secretary, including legal advisor of the authority and any sub divisional magistrate of the district in case of a district.
(3) The competent authority will also be entitled to verify the contents of the declaration under Section 12 of the UP Apartment Act, 2010, and to decide any question, which may arise out of such declaration.
(4) Any dispute raised before the competent authority shall be decided by the competent authority or delegatee as provided above or his delegatee as provided above, to be decided by the officer notified by the state government under Section 27 (2) and (3) of the Act, before it is brought before the Court of law.
(1) After the enforcement of the UP Apartment Act, 2010, no builder, promoter can resist/ or delay the formation of association of apartment owners under Section 14 of the Act.
(2) If the promoter does not get the association registered, the apartment owners can get it registered after a notice giving some time to the promoter and adopt model bylaws. In this case the registrar of societies shall not refuse the registration of the association of the apartment owners.
(3) The promoter, however, has to be made a member as he is jointly responsible with the apartment owners to form an association. Even if he does not get the association registered and does not join or his authorised agents subscribe to be members of the association, he will be deemed to be member of the association for the purposes of enforcement of the Act as the promoter being the member of the association has duties and liabilities under the Act which he has to enforce.
 

(1) Promoters will have to disclose all details of the project and common assets to buyer before allotment.

Competent Authority

About formation of AOAs

Conclusion:

The Deed of Declaration is as important and valuable as the apartment sale deed. Since we residents pay as per ‘Super Area’, value for money for the apartment flows via the undivided land rights and voting rights over the entire parcel of land on which the group housing project is constructed. The 2010 Act and Hon’ble High Court has provided substantial rights to the residents, which needs to be effectively used to seek value of our hard earned money!

Purvanchal Silvercity II RWA illegal, non-entity: HC

In a landmark judgment that will have far-reaching implications on the way gated communities are managed, the Allahabad High Court has declared the RWA at Purvanchal Silvercity II, Greater Noida, illegal and a non-entity. Ordering fresh elections within six weeks under the CEO, Greater Noida, Hon’ble Justice Suneet Kumar ruled, “The constitution of the petitioner-Board of Management is illegal, therefore, would not have a right or authority to manage the affairs of the RWA.” The court ruled that the CEO, or any officer authorised by him not below the rank of Joint Secretary, shall call a joint meeting of the apartment owners and the promoters for the purpose of forming an association of apartment owners. “The association so formed in the said meeting after adopting the Model Bye-laws shall make an application before the concerned Registrar for registration and the association so formed, with the elected office bearers, shall be registered along with bye-laws adopted. After the association is registered, the CEO shall proceed to consider granting recognition to said association,” the court ruled. The court also said that the competent authority as well as the District Authorities shall ensure that no outsider or external bodies, including associations shall be permitted to interfere in the election of the Association. “The Senior Superintendent of Police, Gautam Budh Nagar, shall provide requisite police force, if necessary, on the request of the CEO, Greater NOIDA,” the Hon’ble judge said. “It is provided that the entire exercise as directed herein above shall be concluded within six weeks from the date of service of certified copy of this order,” he said. The RWA, which was incorporated on September 28, 2010, under the Act 1860, never adopted the prescribed Model Bye-laws of UP Apartment Act, 2010. The court observed that no meeting of the general body of RWA was ever convened to adopt the Model Bye-laws. Instead, the RWA Board, which never conducted any elections all these years, made 28 amendments to the Model Bye-laws without 2/3^rd majority of the members and approval of the competent authority. The court also noted that cancellation of the registration and the bye-laws of the petitioner-society by the Deputy Registrar Societies earlier, made the petitioner society a non-entity. The court held that mere issuance of registration certificate by the Deputy Registrar without registering the bye-laws, which in the present case has been cancelled, cannot lead to the conclusion that the petitioner-society is registered under the provisions of the Act. Highlighting the important function of the competent authority assigned under Act 2010, the court said, “In the present case, due to the ongoing dispute the use of common area and facilities by the members have suffered as the petitioner has cut/stalled access to several amenities available to the members. The competent authority is bound to ensure better administration of the property which, inter alia, would require constitution of Board of Management as per Model Bye-laws.” Quoting various judgments, the Court ruled that electoral roll has to be prepared strictly in accordance with the provision of Act 2010, Rule 2011 and Model Bye-laws.

0 to 33 in 99 days!

Witness a revolution at Mist Towers, which is part of the much-hyped Festival City (whatever that means) on Expressway! The promoters, Bhasins of the VW dealership fame (or defame now), have seemingly taken a big gamble with the construction of the 33-storey building in Sector-143. They swear to complete the edifice in 99 days flat, which means building ground to 33rd floor in just 99 days, or one floor in three days. I saw the advert on September 23, but I’m yet to see the building four floors up. Maybe they’ll make up for it: 0-60 in just 3.5 seconds! They haven’t told anyone as to how they’re going to accomplish the feat. I hope they do something about Grand Venice, too. Instead of changing its name every few years.

Heartbreak City

Angry buyers of stalled Sector-107 projects protest inaction of builders & Noida Authority; demand houses or money back with interest

Even as a trial court blasted Delhi Police for shoddy probe in Rs 500cr Unitech case involving a Sector-70 Gurgaon project, over 500 buyers of five different stalled residential projects in Noida’s Sector-107 demanded their houses or full money back with interest. While Additional Chief Metropolitan Magistrate Gaurav Rao observed that this was yet another case where "the builder lobby has taken hundreds of innocent investors for a ride," the Noida buyers said they needed clarity on the issue. 

The projects came to a standstill following a Supreme Court order in 2013 quashing acquisition of a 225-hectare land in Salarpur village in Sector 107. The five projects have close to 5,000 flats, which were mostly sold in 2010-11. The buyers protested the “inaction of builders and the Noida Authority in solving the issue for the past two years.” The general secretary of the Sector 107 Home Buyers Association, Sanjeev Priyadarshi, demanded clarity on the issue from the Authority saying the buyers are clueless while they still pay EMIs every month. "Nobody thinks of the buyers' plight when such decisions are taken,” said Puneet Parashar, a homebuyer. “When the apex court passed the order in 2013, most projects were close to completion. The buyers had already paid anything between 75-90% of the flat costs. For the past one year the projects have seen no progress and the buildings are eventually getting damaged." The Noida Authority had acquired the 225-hectare land in 2008-2009 under the urgency clause of the erstwhile Land Acquisition Act, which was challenged by the farmers first in the Allahabad High Court and later in Supreme Court. 

The apex court in its August 5, 2013 order quashed the land acquisition besides cancelling the entire notification of Sallarpur village. But the construction continued in full swing despite the order. The builders then filed a review petition against the order in the Supreme Court, where a the bench of Justice Teerth Singh Thakur and Justice V. Gopala Gowda heard the case on August 23, 2015, and sent it back to the Allahabad High Court for review. Gopal Subramaniam, representing the builders, told the Hon’ble Supreme Court instead of 182 acres of land, which is what Rajendra Estate Pvt Ltd has appealed for, the entire stretch of 547 acres was cancelled by annulment of the notification, which was issues under section 4 and 6. 

Also that at the time of the judgment passed on August 5, 2013, the builders as well as the buyers were never represented. To this, Justice Thakur said that since the matter of farmer agitation was always in the news, it was surprising that the builders never tried to find out if there was something wrong with their land. However, Mr Subramaniam argued that there was no way builders could have known the status of litigation. Further Mr Subramaniam argued that the Supreme Court bench has given a faourable judgment for the Authority and builders in the order passed in May 2015. Since Salarpur village was already a part of this case, it was argued that the judgment should be applied and review should be accepted. Justice Thakur repeatedly asked "What is the problem then? Which of the judgment was creating a problem?” It was further informed to him that post the August 2013 judgment, many other farmers who had already taken the compensation, have gone to Allahabad High Court and the cases are under consideration. Finally Justice Thakur took a view that since the matter is already being pursued by Allahabad High Court, it is better that the Authority and builders pursued the matter in High Court. He then adjourned the review petition filed in Supreme Court and directed the Allahabad High Court that they should hear the case expeditiously within the next two months and decide on the matter. 

After Metro, time for the tram

After starting work on all three phases of Greater Noida Metro simultaneously, Noida Authority shifts focus to trams in the city 

With the Noida Metro construction work going on in full swing, it’s time for the Noida Authority to focus on the next best thing in sight: trams. Chief Secretary Alok Ranjan has already granted in-principle approval to the project, which is expected to provide last-mile connectivity across the city. Now Chairperson Rama Raman, who’s also the boss of the Noida Metro Rail Corporation (NMRC), wants to push the ‘Spanish’ traffic model  in the city. Raman was part of a delegation that had gone to Barcelona had gone to study the Metro transit system there. The soft-spoken bureaucrat was in total awe of the system in the Spanish capital and wants to replicate the same here. "Public transport such as the Metro and tram are the quickest, simplest and most convenient way of getting around in Barcelona," Raman said. "It is state-of-the-art and completely automated. Not only are the trains driverless, but also a single person controls the entire Metro system. The network is, therefore, a leading example in terms of comfort and speed, while possessing the longest, widest and most user-friendly stations." Raman said that in addition to the Metro, they also studied other options, which were available in the city to facilitate urban travel. "Buses powered by natural gas, and also the use of information technology have led to the ever-increasing use of public transport," he said. Earlier, NMRC decided to hand over consultancy of the tram project to Delhi Metro Rail Corporation. According to NMRC officials, a formal letter of appointment for the consultant will be issued soon and DMRC will work on the feasibility of the project and submit a report within two-three months. "The feasibility will be worked out on several routes which will be selected in order of priority and percentage of ridership,” said an NMRC official. “The routes will complement the existing Metro routes," he said. Mr Raman had also given a presentation and amongst the three proposed routes, one route was shortlisted - Sector 132 to Mahamaya Flyover parallel to Greater Noida-Noida Expressway. This should fuel the realty demand on Expressway further. The tram service will also link Metro stations present in the two regions. The proposed route is likely to cover an area of 10.5 km and will cover all residential colonies that fall under this stretch. While the project is likely to cost over Rs 20 crore per km, the tentative budget will be released only after the DPR report is presented.

Hold your shopping! IKEA coming to Noida…

We don’t know yet if the iconic furniture retailer IKEA would open its first Indian store at Noida, Greater Noida to be precise. But the good news is that the Swedish home furnishings company has inked a deal with the UP Government to open three stores in the state – Noida, Lucknow and Agra. The MoU was signed between CEO of IKEA India Juvencio Maeztu and Principal Secretary, Infrastructure and Industrial Development, Mahesh Kumar Gupta, in the presence of Chief Minister Akhilesh Yadav. The IKEA delegation informed the CM that an investment of Rs 500 crore was estimated in every store. The IKEA Group is the first major single brand retailer to be given FDI approval to set up retail operations in India. IKEA Group has been present in India for 28 years working with 48 suppliers, engaging 45,000+ direct co-workers and approximately 400,000 coworkers in its extended supply chain sourcing products for IKEA stores worldwide. It’s a priority for IKEA to find the right locations at the right price with Metro connection and easy access to public transport. A typical IKEA store size is about 350,000 sqft, built on a plot size of 8-11 acres (about 4 football fields) and offers approximately 9,000 products. Each store employs 400 – 700 coworkers directly and 2,000 indirectly. India is the only country to have IKEA retail, sourcing, IKEA foundation and Next Generation as its four strong pillars. If you’re wondering what Next Generation is all about, it is: IKEA collaborates with artisans in small-scale producer groups and through these partnerships, it creates limited edition, hand-made collections that have been created with a social mission yet still affordable. Currently two initiatives of Next Generation are ongoing in India, with Rangsutra, Swaayam Kala and Industree Producer Transform. The limited edition collections of handmade products are sold in selected stores in Austria, Switzerland and Sweden.

Founded by Ingvar Kamprad in 1943 (formed from his initials – IK - plus the first letters of Elmtaryd (E) and Agunnaryd (A), the farm and village where he grew up), IKEA originally sold sells pens, wallets, picture frames, table runners, watches, jewellery and nylon stockings. Furniture was introduced into the IKEA range in 1948 and the rest is history!