(Citizen Matters, Bengaluru, organised a citizen clinic, ‘Decoding property documentation—your guide to sale deeds, khata, EC and more’, where advocate Mithun Gerahalli, who specialises in property law, answered questions regarding property documentation. Part 1 of the three-part event report series covered the legal issues related to property documentation and the due diligence that new buyers should follow. Part 2 dealt with the khata quagmire, Digital Property Ownership Cards (UPOR) and discrepancy between the owner’s claim and the information in the RTC [Record of Rights, Tenancy, and Crops]. Part 3 is about Apartment Associations Registration and Laws)

Bengaluru’s expansion both horizontally and vertically makes property matters a lot more complicated. Often, home buyers find issues in their property after builder handover. For several years, apartments have been dealing with various complications due to wrong registration and builder legacy issues. Several home buyers associations such as The Bangalore Apartments’ Federation (BAF), Karnataka Home Buyers Forum, and Rera Karnataka, have been raising these issues with the authorities with little results.

BAF, with over 1,300 plus apartment associations, has made strong appeals to the Karnataka Government to bring in legislations to close the gaps pertaining to apartment associations registration and laws. As part of the ‘Every Vote Matters (EVM)’ campaign, during the Karnataka 2023 Assembly Elections, a Townhall was organised as a follow up on BAF’s charter of demands. During this event, most of the parties promised to create an Apartment cell to address these issues. The Congress-led state government launched the KPCC Apartment Cell with MV Rajeev Gowda (ex-MP) as its Chairman. However, hardly anything has been done since then.

Apartment Associations Registration and Laws

What is the due diligence process for an Apartment complex? Is there a checklist for new buyers/associations?

There are no single checklist that is given out under a statute. However, here are some key points related to apartment ownership and documentation in Karnataka:

1. Karnataka Apartment Ownership Act (KAOA):

• The Karnataka Apartment Ownership Act, 1972, governs the ownership and administration of apartment complexes in the state of Karnataka. It establishes a formal framework for individual apartment ownership within multi-unit buildings
• Under this Act, each apartment constitutes heritable and transferable immovable property

2. Deed of Declaration:
   • Apartments are registered under the KAOA through a deed of declaration
   • This deed outlines the rights, responsibilities, and obligations of apartment owners and the association
3. Association and Handover:
   • The association plays a crucial role in managing the apartment complex
   • Buyers and the association need to collaborate to ensure a smooth handover process
   • The association should verify that all necessary documents are handed over by the developer
4. Essential documents:
   • When considering handover, focus on the following documents:
     • Land-related documents: Ensure land ownership and clear titles
     • Project-related documents: Approvals, NOCs, and building plans
     • Structure and building-related documents: Construction details, completion certificates, etc.
5. Undertaking from Developer:
   • Check if your conveyance deed (such as sale deeds) includes an undertaking from the developer regarding the handover timeline
   • Developers often commit to providing necessary documents to the association in due course

Compliance issues faced by Managing Committees

What can be done when a Managing Committee (MC) faces compliance issues like Fire NOC and Consent for Operations, especially when the builder has already received OC, NOC, CFE, etc?

Key points regarding property handover, developer responsibilities, and the role of the Managing Committee (MC):

1. Developer’s Warranty and Title:
   • The developer retains responsibility for the project’s warranty and title, especially concerning the land
   • They cannot disassociate themselves from any issues related to land or project approvals
2. Pre-RERA Projects:
   • Projects developed before the implementation of the Real Estate (Regulation and Development) Act (RERA) face specific challenges
   • Some post-RERA projects also lack essential approvals (like Occupancy Certificates, Khata, STP, etc.).
3. Managing Committee’s Role:
   • When the MC takes over, they must:
     • Accept the handover: Ensure a smooth transition of management and maintenance
     • Include a disclaimer: Even if not explicitly stated, they should add a disclaimer regarding any developer omissions
     • Liabilities Remain with Promoter: The MC is not liable for developer omissions; the promoter remains responsible
4. Handover components:
   • The MC primarily takes over maintenance, management, and document receipt
   • However, legal advice is crucial to navigate complexities

Common amenities  

Who owns Common Amenities in apartments/gated communities?

Gated community is a common term that is used for villas or sites that are formed in lands, which are mostly layouts. There is no specific legal definition of a “gated community” within existing laws, The term is commonly used by property developers for marketing purposes.

1. Interconnected layouts:
   • Under the Municipalities Act, there is a requirement that one layout should be interconnected with another layout. This concept ensures the right of ingress and egress, allowing residents to move freely between adjacent layouts
   • When layouts are interconnected, it facilitates better access and connectivity within the overall development
2. Gated Communities and compound walls:
   • While the term “gated community” lacks a precise legal definition, some projects do create enclosed compounds or walls around the entire development
   • If a project provides for an enclosed compound as one of the preconditions, it may indeed have a gated community setup
   • However, layouts typically do not have such provisions for gated communities unless they explicitly include compound walls
3. Mixed projects:
   • In mixed-use projects (combining apartments and villas), the situation can vary:
     • Apartments often come within a compound, as they are part of larger buildings
     • Villas, on the other hand, may have their own enclosed compounds
     • Therefore, mixed projects can exhibit both gated and non-gated features

Read more: BDA must get unrelinquished CA sites from layouts: High Court 

Commercial activities 

There is an explosion of home businesses – tuition/classes, serviced apartments, etc, are such businesses allowed inside flats/villas? 

Apartments in Karnataka fall under the purview of the Karnataka Apartment Ownership Act (KAOA). This legislation governs the ownership, management, and rights related to apartment buildings

However, it’s important to note that the KAOA is not mandatory unless the project promoter or the association voluntarily registers the project under this Act

1. Deed of Declaration and Registration:
   • When an apartment project is registered under the KAOA, it involves creating a “deed of declaration.” This deed is registered before the sub-registrar, ensuring that the provisions of the Apartment Ownership Act apply to the apartments within the project
   • The deed of declaration outlines the rights, responsibilities, and rules governing apartment owners and the management of common areas
2. Residential Use and Commercial Prohibition:
   • Under the KAOA, registration is typically limited to pure residential apartments. Commercial apartments or buildings cannot be registered under this Act as residential units
   • Non-commercial activities are allowed within the residential flats once they are registered. However, any commercial use must be restricted to designated areas within the project
3. Clubhouses and Mixed-Use Areas:
   • If a project includes a separate commercial building (such as a clubhouse) attached to the residential flats, that commercial area is accepted under the project
   • Clubhouses within the project can serve as spaces for non-residential activities, but the individual apartments themselves should remain purely residential

Next steps

• Government to clarify and streamline regulations around apartment registration, addressing gaps between Karnataka Apartment Ownership Act, Karnataka Societies Registration Act, and Cooperative Societies Act. Consider making the KAOA automatically applicable to completed projects without requiring developer registration.
• Banks follow stricter guidelines from Reserve Bank of India (RBI) before funding projects without proper approvals
• Government to implement stricter enforcement and compliance measures for layout approvals, especially regarding sewage treatment plants (STPs) and infrastructure requirements
• Developers to ensure proper handover process and documentation to apartment associations, including land documents, project approvals, and building-related documents
• Government to consider additional criteria for project completion certificates, including mandatory handover of documents and clearances to associations

Watch the full video below:

(Consulting legal experts or professionals experienced in property matters is advisable. They can guide you through the paperwork, legal requirements, and any specific provisions related to the land)

Also read:

• For home-buyers in Bengaluru, a checklist to assess water security
• How should apartments and gated communities handle transformer maintenance?