MahaRERA Allows Extension Of Property Registration Without Majority Consent

To ensure that delayed real estate projects are completed, the Maharashtra Real Estate Authority (MahaRERA) has allowed developers to apply for extension of property registration without the need for consent of 51 percent of homebuyers.

Developers will be required to state the reason why registration should be extended without such consent. MahaRERA also asked developers to declare their interest in multiple real estate projects during registration, a step that would help homebuyers to take an informed decision.

MahaRERA, in its order, said developers do not get consent homebuyers’ consent often despite being willing to complete an unfinished project. The order states: “It has been noted with concern by the Authority that in matters regarding extension of project registration under Section 7 (3) of the Act when promoters are seeking consents from the concerned association of allottees consisting of a majority of allottees who have booked their plot or apartment or building in the real estate project, the consents are not being provided for the following reasons (not exhaustive).”

The three reasons mentioned in the order include homebuyers’ concern that their complaint to the Authority would be dismissed, that relief would not be forthcoming if the consent is given and lack of confidence that the developer would complete the project. When homebuyers do not consent to the renewal of registration, it stops the developer from executing a project. This, the order said, is not in favour of homebuyers.

Developers shall submit the consents as obtained from the allottees irrespective of the number of such consents along with reasons why the required percentage of consents from allottees could not be obtained and why the application for extension should be considered without the required 51% consent.

Developers have been asked to additionally submit an explanatory note, setting out the grounds and reasons for the delay in completion of the real estate project as well as setting out the need for a grant of extension along with documents supporting such grounds and reasons. The promoters were also asked to state the steps they would take to complete the project within the extended period sought.

The order adds, “Application of extension of validity of the project registration shall be accompanied with the prescribed fees calculated in the manner as stated in Rule 7 (3) of the Rules. The grant of extension of the project validity shall not affect/jeopardise the rights accrued in favor of the allottees who have booked their plot, unit or apartment, or building in the said real estate project as the case may be for which extension of project validity is sought.” Experts say the order may be in good faith, but it can be challenged in a court of law.


HC seeks MahaRERA reply on 1.5 yr delay in hearing complaint

The Bombay high court has sought a reply from Maharashtra Real Estate Regulatory Authority (MahaRERA) regarding a homebuyer’s plea that the housing regulator has not taken up her complaint for hearing for the last one and half years.

Homebuyer Geeta Bhavesh Bhanushali had filed a writ petition in the high court after her complaint was not taken up by MahaRERA for hearing.

Lodha and Lodha Advocates, appearing for the petitioner, contended that their client’s grievance was that MahaRERA had not scheduled a hearing of her complaint for the last one and half years.

A bench comprising Justices SV Gangapurwala and SG Dige directed assistant government pleader Uma Palsuledesai, who appeared for the state, to take instructions from MahaRERA and inform the court on the status of the petitioner’s complaint and cite the reasons why it has not been listed for hearing. The court scheduled the next hearing on December 12.

Bhanushali, her husband Bhavesh, and father-in-law Kalyanji Bhanushali are residents of flat no 903 in the B wing of Tirumala Habitat project in Mulund West. They had booked the flat in June 2011 by paying ₹1.12 crore including taxes. Though the agreement for sale promised possession on or before September 30, 2014, the possession was delivered only in September 2019 after a delay of five years, the complainant alleged.

The complainant also alleged that she was shocked when the family received the first property tax bill on November 16, 2019 from the Municipal Corporation it showed flat nos 903 and 904 approved as a single flat. She had approached MahaRERA with a complaint seeking interest on delayed possession and prayers for sub-division of the flat among other grievances.

Over 6000 complaints pending with MahaRERA

In a related development, social activist and advocate Godfrey Pimenta, who represents homebuyers before MahaRERA, wrote to chief minister Eknath Shinde that homebuyers of stalled projects were complaining that hearings before MahaRERA are “unduly” delayed, in some cases, for close to two years.

The letter said there were 38,750 ongoing real estate projects registered with MahaRERA and a total of 19,290 complaints filed with the regulator. Out of these,12,971 complaints were disposed of and 6,319 complaints were yet to be heard.

The letter submitted through Mumbai Suburban Collector Nidhi Choudhari to the CM pointed out that a recent JLL report had estimated that there were 99,000 stalled residential units in MMR, and delays in hearing cases pertaining to Section 7 and 8 of RERA which seek deregistration of a delinquent developer and appointment of a new developer further compound the misery of homebuyers.


Buyers can seek refund if builder skips possession dates: Tribunal

Setting aside an order by the MahaRERA chairperson, the Maharashtra Real Estate Appellate Tribunal (MREAT) observed that the developers continued to skip mentioning the date of possession of flats in their allotment letters given to home buyers even two years after RERA came into place. The tribunal has asked MahaRERA to view this seriously.

“This requirement, envisaged by RERA, is flouted more often than observed which needs to be viewed seriously by the authority,” observed a tribunal bench, comprising Shriram Jagtap, member judicial, and SS Sandhu, member administrative, in a November 11 order. The bench also slammed the practice of developers not sharing a draft Agreement For Sale (AFS) containing the terms and conditions prior to asking for payment for execution of the agreement.

The tribunal also took strong exception to the Authority’s “over emphasis” on the view that home buyers need to seek reliefs under Section 18 on or before the Occupancy Certificate (OC) is obtained, and that they were not entitled to refunds under the section if they file the complaint after the OC is obtained by the promoter. MahaRERA had backed the promoter’s contention that irrespective of the delay in granting possession, once the OC is obtained or possession offered, Section 18 would not apply.

In this case, the home buyers had filed the complaint on March 17, 2021, after the promoter had obtained the OC by February 9, 2021.

The observations came on appeal filed by senior citizens, Bijon and Shanta Talukdar, who had booked a flat in Eirene project by promoter Dhruva Woolen Mills Pvt Ltd. Booked under the 9:91 scheme, the couple had paid ₹9.44 lakh and the remaining 91 per cent was payable at the time of possession.

Though the email communication between the parties indicated June 2020 as the date of possession, it was not specified in the letter of allotment (LOA) issued by the promoter on June 19, 2019 – on the MahaRERA portal, the promoter mentioned the possession date as December 2019, with a grace period of six months. Thereafter, the promoter could not hand over possession by June 2020, thanks to the lockdown; and in the intervening period MahaRERA allowed extension of possession date till December 2020.

Meanwhile, the home buyers served notice on the promoter on August 24, 2020, to hand over possession within 15 days, failing which their money be refunded with interest. They reiterated the demand in another legal notice dated January 21, 2021. Thereafter, the promoter informed the couple that OC had been received on February 9, 2021, and asked them to take possession by paying the balance 91 per cent amount as agreed.

As the demand for refund with interest was declined, the home buyers had filed a complaint seeking refund of the amount under Section 18 for delay in possession. MahaRERA had dismissed the complaint after agreeing with the promoter’s contention. Aggrieved by the order, the home buyers had challenged the September 7, 2021, order before MREAT.

The tribunal held that the promoter had replied to the legal notice only on February 26 (after the OC was obtained on February 9) declining to refund their investment, and therefore, there was no undue delay in homebuyers approaching MahaRERA seeking relief under Section 18.

The orders by MREAT can be challenged by aggrieved parties before the Bombay High Court in second appeal on a point of law.


RERA Declares 139 Projects As Lapsed, Declare One Month Deadline

As per RERA registration, 139 projects in the Pune district, which were not completed within the stipulated time and did not get an extension, have been declared as lapsed projects by Maharera.

Maharera will issue show-cause notices to these projects. As per Sections 7 and 8 of the RERA Act, the projects can be taken up through the Consumer Co-operative Housing Society. Developers have been given a deadline of one month.

The builders had promised to complete the project in 2022 but did not complete it. RERA registration is mandatory for developers and their projects. As per this registration, the developers must complete the project within the time given by Maharera to complete the project. Also, there is a provision for strict action against the developers who violate this rule.

Projects are extended if the developer submits 51 percent customer consent. But even for that, the developers are not coming forward. It hits the customers hard. So now Maharera has decided to take action against such developers. These developers have been given one month to make their case and explain why the project has been stalled. He also said that action will be taken as per Sections 7 and 8 of RERA against the developers who do not come forward or give a satisfactory reply within this period.

You can check the details here:


MahaRERA suspends 52 builders from KDMC

The Maha Real Estate Regulatory Authority (RERA) suspended registrations of 52 builders from Kalyan–Dombivli Municipal Corporation (KDMC) limits on Monday. The list has been uploaded on the civic body’s official website.

This move by RERA comes after KDMC had registered an FIR against 27 developers for forgery and cheating last week. FIRs against 39 others are underway.

The civic body has said that the builders had produced fake documents to acquire the RERA certificate.

“We have uploaded the list of suspended builders from KDMC on our website,” said Vasant Prabhu, secretary, RERA.

All real estate projects registered with RERA are provided with a certificate having a unique registration number. It has all the information about the property. A developer, builder or a property agent cannot advertise, book or sell real estate without obtaining the RERA certificate.

The KDMC has informed that these 27 developers had forged the required documents to procure the RERA certificate.

This action by the civic body comes after a city-based architect and social activist, Sandeep Patil, 43, filed a Public Interest Litigation (PIL) in the Bombay High Court in 2021. He drew the court’s attention towards the builders who made fraudulent documents for the purpose of registration of flats/ shops in illegal buildings because of which innocent people were cheated throughout Maharashtra.

Patil had raised the matter of 66 builders and demanded action.

“While I have raised the name of 66 builders only 52 have been suspended by RERA. I checked the list online and found all the builders are those mentioned by me in my complaints. What about the remaining 14 builders? Also, suspension will not help as it is temporary – a proper legal case should be done in this matter. I will follow up with this too,” said Patil.

“The Dombivli police is working on registering cases against 39 more builders shortly,” added Patil.

The cases registered at the police station are under Sections 420, 465, 467, 468 and 471 of the Indian Penal Code.

Disha Sawant, assistant town planner KDMC, said, “This suspension is done by the RERA so we cannot comment on it. Meanwhile, KDMC is carrying out its own investigation.”


Over 50% projects tagged ‘ongoing’ since MahaRERA, still await completion

Over 50 percent of the total projects registered as ‘ongoing’ with the Maharashtra Real Estate Regulatory Authority (MahaRERA) when the regulator came into being in 2017 are yet to be completed, according to data accessed by Moneycontrol under the Right To Information (RTI) Act.

About 13,246 projects were listed as ‘ongoing’ in 2017, of which 6,557, or about 49.5 percent, have been completed.

A total 36,461 projects, including the ‘ongoing’ ones, have been registered since the inception of MahaRERA, of which 9,637 have been completed.

About 3,080 completed projects are new projects with the rest being ‘ongoing’ projects.

The data reveals that out of the total completed 9,637 projects, about 1,897, or 20 percent, were completed only after getting an extension. These include 1,655 ongoing projects and 242 new projects.

Maharashtra was one of the first states where rules and all sections of the Real Estate (Regulation & Development) Act, 2016, were notified and came into force on May 1, 2017.

What is an ongoing project?

When the RERA Act came into effect, the MahaRERA had asked all new and ongoing projects to register without which they could not market, sell or get approvals.

All ongoing as well as under-construction projects which had not received completion certificates had to get registered with the regulatory authorities within three months, i.e, July 31, 2017.

Further, projects with a plot size of a minimum 500 square metres or eight apartments also came under the purview of the Act. MahaRERA had also levied a penalty on developers of ongoing projects who did not adhere to the deadline set for registering the ongoing projects.

What is a new project?

A new project that is starting afresh and has come into existence after the MahaRERA became effective on May 01, 2017. All such projects launched after RERA Act came into effect have to register their projects with MahaRERA in order to market or sell units in them.

As per the data, about 63 percent or 23,215 projects out of the total 36,461 registered, as of June 2022, are new projects.

What’s the solution for the completion of ongoing projects?

Gautam Chatterjee, retired IAS officer and first chairman of MahaRERA, said, “We got these 13,000 ongoing projects registered within a period of two to three months after MahaRERA got into action from May 2017. The whole point is these are the legacy projects that are stuck due to several problems for whatever reasons they might be. Around 4,500 projects that are lapsed but we need to look at around 2,000 odd projects where the buyer’s money is involved and try getting them back on track.”

Chatterjee added, “We have to make efforts to ensure that these projects are completed by imposing sections 7 and 8 of RERA Act that allow taking over of the projects that are stuck. I know that the MahaRERA has recently launched a vertical for stalled and lapsed projects where they need to be analysed and measures should be taken to ensure they are completed.”

Chatterjee said that one of the few measures could be involving all the stakeholders, including financial institutions, in taking the project ahead apart from the association of allottees when they take over the project. But this would require amendments in the Act, and they should be done after carefully analysing the projects that have lapsed or are stalled.

A senior MahaRERA official not wishing to be named said, “It is true that the majority of the stalled projects are those that were registered as ongoing projects. We are in the process of appointing investigators who will go on projects where we suspect that a significant amount of the money is spent, but no groundwork is evident. The plan is to get things moving in the coming months. Out of the total lapsed projects, we are aiming and focusing on 900 odd projects where the pushing by the regulator might work in favour of the buyers.”

Lapsed projects vertical

MahaRERA chairman Ajoy Mehta on June 22 announced the formation of a dedicated vertical on lapsed or stalled real estate projects to get these projects moving by either the existing developer taking it ahead or buyers taking over the project or by roping in a new developer.

“We have verticals for grievances, complaints, registration, adjudication, and administration. Similarly, this vertical will be for stalled projects. If we have to look essentially at stalled projects, out of 4,500 stalled projects, 1,500 do not have bookings. Out of the 3 lakh apartments that are stuck, 1.28 lakh do not have bookings. My focus is on stalled projects where there is money from homebuyers involved. The approximate worth of stuck projects is expected to be Rs 78,000 crore. We will tackle money from banks and financial institutions at a later stage,” Mehta was quoted as saying.

When is a real estate project declared lapsed?

Every project registered by a developer with MahaRERA is given three to four years for completion, which is considered a reasonable time, followed by the issuance of a registration number for the project.

A search on the MahaRERA website using this number will throw up all details relating to the project. The registration number is to be published by the developer in every advertisement or promotion activity related to the project.

However, a project is termed as ‘lapsed’ when the timeline given for completion is not met, and the developer has not applied for an extension. Once the registration of the project is declared ‘lapsed’, the developer cannot advertise, market, book, sell or offer to sell, or invite persons to invest in these projects. Such projects cannot be registered by the registrar of the revenue department.


MahaRERA orders developer to deduct 2%, not 10%, of the price of apartment for cancelled booking

The Maharashtra Real Estate Regulatory Authority (MahaRERA), in a recent order, directed the developer of Kalpataru Avana, a luxury real estate project in central Mumbai, to deduct 2 percent of the total price of flats, and not 10 percent, for cancellation of booking by homebuyers.

The ratio mentioned in the letter of intent (LOI) signed between homebuyers and Kalpataru Limited, the developer, was 10 percent. MahaRERA said the proportion mentioned in one of the clauses of the LOI appears to be unreasonable.

MahaRERA received six separate complaints from individuals and a company in August 2020, seeking directions to the developer to refund the entire amount paid by them along with interest and compensation under section 18 of the Real Estate (Regulation & Development) Act, 2016.

The complainants said they had not signed a sale and purchase agreement, but an LOI in 2015 which was effectively an allotment letter under settled case law.

Although no date of possession was mentioned, a period of three years had been cited as a reasonable date for completion of projects in previous rulings, the homebuyers said.

They said they had informed the developer they wished to withdraw from the project and requested a refund along with interest and compensation in July 2020. The developer got the occupation certificate for the flats in October 2021.

In response, Kalpataru filed six complaints in February 2021, seeking directions from MahaRERA to the buyers to execute an agreement for sale and purchase under section 13 of RERA and also to pay the remaining amount due to the developer with interest.

MahaRERA did not find merit in the complaints, saying the buyers had already decided to withdraw from this project and approached the authority for cancellation of their booking, alleging violation of various provisions of RERA.

MahaRERA said the developer had filed complaints after the buyers had filed theirs. In such a scenario, the buyers cannot be forced to remain in the project and execute the agreements, it ruled.

“Clause no. 20 of the said LOIs mentions the forfeiture of 10% of the total consideration value of the said flats. However, … the said booking application form provides that upon cancellation of the said flats, the promoter is entitled to forfeit 2% of the total consideration of the said flats,” MAHARera said.

It added: “Such forfeiture clause as mentioned in the LOIs appears to be unreasonable, after commencement of RERA and even it does not seem to be in consonance with the recent MahaRERA Order No. 35 in August 2022, issued with respect to the prescribed format of allotment letter, which permits the promoter to forfeit 2% amount.”

In August 2022, MahaRERA issued an order prescribing the number of days and amount that can be deducted in case of cancellation of a booking. According to the order, no amount can be deducted for cancellation within 15 days of booking, 1 percent of the cost of the unit for cancellation between 16 days and 30 days, 1.5 percent between 31 days and 60 days and 2 percent after 61 days.

An email query sent to Kalpataru elicited no response.

“This ruling will be of assistance to allottees if a higher rate of deduction for forfeiting the consideration amount is mentioned in the allotment letter,” advocate Trupti Daphtary said.

Advocate Nirav Jani, a partner at Vigil Juris, said: “MahaRERA has further legislated contractual terms between the parties wherein the allottee (home buyer) will only be penalised up to 2 percent of the consideration in case of default by allottee as well. The ruling rewrites the contract previously executed between the parties. This may be an impediment for parties to enforce clauses which have been agreed between the parties and arrive at a commercial understanding.”


MahaRERA order to allow developers to cut over 2% amount from buyers in booking cancellation

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has issued a revised order that will pave the way for developers to increase the deduction amount in case of a booking cancellation, which was earlier capped at 2 percent.

In July, MahaRERA had issued an order prescribing the number of days and amount that can be deducted in case of cancellation of a booking. According to this, no amount could be deducted for cancellation within 15 days of booking, 1 percent of the cost of the said unit between 16 days to 30 days, 1.5 percent between 31 days to 60 days and 2 percent for cancellation over 61 days.

In this context, the MahaRERA in the July order had stated, “The Table in Clause 9 of the allotment letter prescribes the minimum period (number of days) within which the booking can be cancelled and the upper limit of the percentage of the amount to be deducted in case the allottee desires to cancel the booking.”

The order added, “The promoter may if the promoter so chooses, increase the number of days within which the booking can be cancelled as well as decrease the percentage of the amount to be deducted in the event of cancellation of the booking, in the allotment letter prescribed.”

However, in a revised order dated August 12, 2022, in relation to model allotment letter and model agreement for sale, the MahaRERA has not mentioned about developers being able to increase the number of days or decrease deduction amount, in case of cancellation of booking.

Additionally, the MahaRERA has said that if the developers want to add any points in case of deviations it should highlight the same with different colour.

In this context, the MahaRERA order states, “If promoters choose to execute with an allottee an allotment letter that is not in accordance with the proforma of the allotment letter as approved by the Authority in its meeting held on 24.06.2022, than the deviations/modifications in the proforma of the allotment letter as proposed by promoters shall be highlighted in different colour.”

The same has to be uploaded by the developer along with a deviation sheet mentioning/indicating therein the deviations/modifications while seeking registration of the real estate project so as to enable the allottees to make an informed decision, said MahaRERA in its order.

Explaining the significance, Chartered Accountant Aditya Zantye who practices with MahaRERA, said, “The MahaRERA’s revised order of August 12, 2022 has basically in a way paved the way for developers considering differing circumstances of different properties offered for sale to deduct more than 2 percent in case of cancellation of booking by highlighting the deviation or change in different colour.”

Zantye added, “A similar order issued in July 2022, allowed developers to decrease the deduction amount, however, the revised order now does not speak about decreasing and nor bars any increase. So, by this developers can charge more than 2 percent for cancellation by highlighting it in different colour. In a way, it is a good move considering litigation might come down by this. Also, more than 10 percent booking amount is in any way not permitted.”

Further, developers have welcomed the revised order by MahaRERA issued on August 12.

Manju Yagnik, Vice Chairperson, Nahar Group and Sr. Vice President, NAREDCO Maharashtra said, “This is a brilliant move by RERA which would further increase the transparency in the real estate sector while simultaneously empowering the end consumer. The fact that the developers would need RERA’s approval for any changes made to the sale agreement and the allotment letter should provide the consumer’s much-required relief.”

Yagnik added, “This would give the homebuyers maximum possible information on every aspect of the project and would also reduce future litigation processes if any. This standard draft would prevent multiple discrepancies between the developer and the consumers and would further streamline the home buying process.”

Meanwhile, the Maharashtra Real Estate Appellate Tribunal (MREAT) in its recent ruling had said that Real Estate Regulatory (RERA) Act doesn’t allow a property developer to forfeit money from the amount paid by a buyer if they cancel a purchase. It added that the RERA Act is silent on the point of permissible deduction if the buyer unilaterally cancels a booking for whatever reason.


Cumballa Hill resident gets refund with interest for 8-year delay in project

The MahaRERA appellate tribunal has ordered an Indiabulls subsidiary to refund the entire amount paid by a South Mumbai resident for a flat near Khalapur, along with interest for eight years and costs, for failing to hand over possession long after the agreed deadline.

Pradip Mehta, a resident of tony Cumballa Hill, had booked a flat for Rs1.17 crore in the Indiabulls Savroli 1 project near Khalapur in July 2014. The project was being developed by Sylvanus Properties, a wholly owned subsidiary of Indiabulls.

Mehta said the developer attracted buyers by showing a rosy picture of the project with a twelve-hole golf course and a 50,000 sq ft clubhouse.

He made an initial payment of Rs 17 lakh and said the developer had promised possession by February 2018.

However, when the Real Estate Regulatory Authority (RERA) Act came into force, the developer unilaterally changed the possession date to February 2019 while registering the project with MahaRERA, the regulator for Maharashtra.

The developer missed that deadline, too. According to Mehta, the project remains incomplete.

The developer argued that no agreement for sale had been executed and no possession date agreed to. The company said unilateral exits by buyers from a project would result in huge losses to the developer. It said such unilateral exit when there is no violation of RERA provisions by the developer ought to result in forfeiture of the amount paid under clause 16(c) of the law.

But the tribunal did not find any substance in these arguments and said the buyer was eligible for a full refund with interest from July 2014 till the date of realization of the amount under section 18 of the RERA Act.

Advocate Nilesh Gala, who represented Mehta, described the order as significant since the tribunal had ruled in favour of the buyer despite the developer claiming there was no agreement for sale.

“The significance of the order is that a developer cannot forfeit the payment or deduct money for no fault of the buyer,” Gala said. “While the model allotment letter issued by MahaRERA prescribes some deductions for cancellation of booking, there is no such provision in the act is what the judgment states.”

Moreover, he pointed out, even if there is no explicit agreement on the date of possession, other factors can be considered to ascertain it. The Savroli 1 project has been delayed for a long time and the developer has sought many extensions from MahaRERA.

Mehta had first approached MahaRERA for compensation of Rs5 lakh for the developer’s failure to provide the promised amenities, a refund of the amount he had paid with interest from July 2014, and Rs1 lakh towards litigation costs.

MahaRERA did not offer him any relief and simply directed the developer to execute a sale deed. It also said that if the buyer still wanted to exit the project, the developer could retain a portion of the amount paid. Aggrieved, Mehta moved the tribunal.

Sylvanus argued before the tribunal that the buyer had produced no document indicating a date of possession and the booking was made before the RERA Act came into force.

The company said a buyer has to pay at least 20% of the total sale amount before an agreement can be executed and registered, something Mehta had failed to do despite repeated reminders.

This, it said, violated section 4 of the Maharashtra Ownership of Flats (Regulation of the Promotion, Construction, Sale, Management and Transfer) Act, 1963, and section 13 of the RERA Act.

But the tribunal noted that as per the registration details submitted by the developer, the company had promised to complete the project by 2017, three years after work on it began.

A buyer cannot wait forever for possession of a flat, it said, particularly when the developer had failed to hand it over despite repeated extensions of the deadline.


MahaRERA standardises home allotment letters for realtors

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has introduced standardised allotment letters for developers in a bid to bring in transparency and minimise buyer-seller disputes.

The newly introduced allotment letter would require developers to mention the date of handing over the possession of the booked property, percentage of charges levied on cancellation of booking, parking allotment and other details.

MahaRERA officials said that a standard allotment letter has been readied in a bid to bring in uniformity and safeguard the interest of flat buyers and developers.

The allotment letter prescribes the minimum period within which the booking can be cancelled and the upper limit of the percentage of the amount to be deducted in case an allottee desires to cancel the booking.

“The promoter may increase the number of days within which the booking can be cancelled as well as decrease the percentage of the amount to be deducted in the event of cancellation of the booking,” the letter stated.

Developers need to upload the allotment letter or the amended form of allotment letter at the time of applying for registration of the real estate project, said officials.

In case of non-compliance of the same, the application for registration of the project shall be liable to be rejected.

All MahaRERA developers would have to follow the model allotment letter or face action, stated consumer activists.

There is a provision in the MahaRERA that if a developer fails to follow the notification circular, then the real estate authority could slap a fine up to 5% of the project cost.

The same would be applicable to developers in the event of their not accepting the model allotment letter format, said Ramesh Prabhu, activist and chairman of the Maharashtra Societies Welfare Association.

Earlier, there used to be no mention of the cost of a flat in the allotment letter, but now, as per the model allotment letter, the builder has to mention the value of the property. According to the model allotment letter, in case of cancellation of a flat booking after 60 days, a developer can only charge a maximum of 2% of the cost of a flat as forfeiture fees.

Advocate Manjunath Kakkalameli told TOI that the standardised allotment letter would save flat buyers from legal loopholes. “Earlier, there were some issues with allotment letters as they did not meet the provisions and rules of MahaRERA and buyers had a trying time getting possession of their flats. This model letter will bring in transparency and help in reducing legal hurdles,” he said.

Some builders have expressed concern that small developers may avoid MahaRERA registration. “While big builders in metro cities will abide by the rules, developers in smaller cities and districts may not adhere to the model allotment letter,” said a leading builder in the state.