Occupancy Certificate? It is builder’s responsibility!

Does your new flat have Occupancy Certificate? Why is Occupancy Certificate required for a completed house? Who is responsible to get it? What can happen if there is no Occupancy Certificate?

Although almost all the consumers in Bengaluru who purchase flats and apartments are concerned about A or B khata, they do not bother to verify whether the property purchased by them has a valid Completion certificate / Occupancy certificate.

In simple terms, the absence of a valid Completion certificate / Occupancy certificate, means that the building may not have been built as per approved plan, and the threat of demolition of unauthorised structure looms large.

Further, if you want to sell or hypothecate the property after a lapse of say 10 years, you will not be able to do so, if you do not possess a valid Completion certificate / Occupancy certificate. Though this is not blocked by law, people usually do not purchase the houses without occupation certificates. When one goes to bank for mortgaging a house, they also look for occupancy certificate.

Many buyers are not aware of the importance of Completion Certificate and Occupancy Certificate. Even when someone knows it, builders trick the buyers by not giving. What should the buyer do in such situations?

Does the law help?

Supreme Court has given a judgment in a case between Faqir Chand Gulati and Uppal Agencies Pvt. Ltd. which clearly holds the builder responsible for the provision of completion and occupancy certificate. It also underlines the problems created by such acts of the builders. The case was between a land owner and builder, over not having Completion and Occupancy Certificates for the constructions, and deviations from the sanctioned plan.

Some of the excerpts from this landmark judgment are as follows:

1.1    Builders violate with impunity the sanctioned building plans and indulge deviations much to the prejudice of the planned development of the city and at the peril of the occupants of the premises constructed or of the inhabitants of the city at large. Serious threat is posed to ecology and environment and, at the same time, the infrastructure consisting of water supply, sewerage and traffic movement facilities suffer unbearable burden and are often thrown out of gear.

Unwary purchasers in search of roof over their heads and purchasing flats/apartments from builders, find themselves having fallen prey and become victims to the design of unscrupulous builders. The builder conveniently walks away having pocketed the money leaving behind the unfortunate occupants to face the music in the event of unauthorized constructions being detected or exposed and threatened with demolition.

Though the local authorities have the staff consisting of engineers and inspectors whose duty is to keep a watch on building activities and to promptly stop the illegal constructions or deviations coming up, they often fail in discharging their duty. Either they don’t act or do not act promptly or do connive at such activities apparently for illegitimate considerations. If such activities are to stop, some stringent actions are required to be taken by ruthlessly demolishing the illegal constructions and non-compoundable deviations. The unwary purchasers who shall be the sufferers must be adequately compensated by the builder.

The arms of the law must stretch to catch hold of such unscrupulous builders. At the same time in order to secure vigilant performance of duties, responsibility should be fixed on the officials whose duty was to prevent unauthorised construction, but who failed in doing so either by negligence or connivance.

1.2.    “If the construction is part of a building which in law requires a completion certificate or C&D forms (relating to assessment), the builder is bound to provide the completion certificate or C&D forms. He is also bound to provide amenities and facilities like water, electricity and drainage in terms of the agreement. If the completion certificate and C&D forms are not being issued by the Corporation because the builder has made deviations/violations in construction, it is his duty to rectify those deviations or bring the deviations within permissible limits and secure a completion certificate and C&D forms from MCD.

The builder can not say that he has constructed a ground floor and delivered it and therefore fulfilled his obligations. Nor can the builder contend that he is not bound to produce the completion certificate, but only bound to apply for completion certificate. He cannot say that he is not concerned whether the building is in accordance with the sanction plan or not, whether it fulfills the requirements of the municipal bye-laws or not, or whether there are violations or deviations.

The builder cannot be permitted to avoid or escape the consequences of his illegal acts. The obligation on the part of the builder to secure a sanctioned plan and construct a building, carries with it an implied obligation to comply with the requirements of municipal and building laws and secure the mandatory permissions/certificates.”

1.3    “A prayer for completion certificate and C&D Forms cannot be brushed aside by stating that the builder has already applied for the completion certificate or C&D Forms. If it is not issued, the builder owes a duty to make necessary application and obtain it. If it is wrongly withheld, he may have to approach the appropriate court or other forum to secure it.

If it is justifiably withheld or refused, necessarily the builder will have to do whatever that is required to be done to bring the building in consonance with the sanctioned plan so that the municipal authorities can inspect and issue the completion certificate and also assess the property to tax. If the builder fails to do so, he will be liable to compensate the complainant for all loss/damage. Therefore, the assumption of the State Commission and National Commission that the obligation of the builder was discharged when he merely applied for a completion certificate is incorrect.”

Through this judgment, the Supreme Court directed the consumer forum to re-look the case and treat the land owner as a ‘consumer.’ Though the context of litigation is somewhat different, the judgment underlines the importance of the builder obtaining occupancy certificate. This is usable in other cases being fought by the residents wanting Completion Certificate / Occupancy Certificate.

Get your Occupancy Certificate through Consumer Forum

Now, how to deal with the builder who has not given you a valid Completion Certificate / Occupancy Certificate?

  1. You need to issue a notice to the builder to apply and handover Completion Certificate / Occupancy Certificate, within one month from the date of issue of your notice.

  2. If the builder does not respond, file a complaint in the consumer forum, and pray the forum to issue directions to the builder to apply and obtain the above certificates.

  3. You can also mention in the complaint that the Hon’ble Supreme Court has given a judgement in Faqir Chand Gulati vs Uppal Agencies Pvt. Ltd. & Anr on 10 July, 2008 that “Even if such a provision for providing completion certificate is not found in the agreement, the builder cannot escape the liability for securing the Completion Certificate and providing a copy thereof to the owner. The law requires the builder to obtain completion certificate of such a building.”

If this does not work, one can actually file a writ with relevant documents, against the errant builder. Surely this is better than having to face a Campa-Cola-like situation some other day in the future!

Related Articles

Overcoming the Occupancy Certificate hurdle to your dream home
Khata guide for apartments


  1. George Abraham says:

    Most flats in Bangalore do not have ‘A’ Khata for the simple fact that it has a deviation. An approved plan exists for all apartments, only thing is that it was approved by Panchayat or even BBMP for that matter. Everyone is waiting for Akrama Sakrama to get the A Khata and plans regularized. What is the importance of the Completion Certificate after that? All these flats are funded by the banks and even get refunded in case of a resale. We live in a country where is an alternative for every deviation. Why worry about this one document?

  2. bangalore citizen says:

    There are lots of cases which are not made public may be purposely or intentionally to make sure let real estate in Bangalore grow and let government keep in getting revenue through registration , tax etc.. there are lots of cases in Bangalore, where BBMP has demolished illegal apartments (http://timesofindia.indiatimes.com/city/bangalore/Apartment-owners-wake-up-to-a-demolition/articleshow/31443989.cms), there is not one .. there are multiple examples of this.. ultimately common man is sufferer.. just imagine.. you have invested your hard earned money.. and one day you are on road with your family.

  3. George Abraham says:

    The Shobha case mentioned in the Times of India article is a case of lake encroachment but flats built on land with proper titles but having deviations do not face any major threat. Many apartments have come up under Panchayat Administration and Panchayats do not issue Completion Certificate. The builder has handed over the flats to the owners and have moved on. Does the flat owners not have the right to get the Occupany Certificate from BBMP?

  4. bangalore citizen says:

    Most of the apartment in Bangalore are build with some deviation (more than 5%). As per Karnataka Apartment Act, staying in apartment without OC is offence, authorities can anytime ask you to vacate. Authorities knows very well that people are staying in apartment without OC ( they know very well and waiting for right time to attack :)) and if apartment has deviation is beyond 5% , there is no chance you will get Occupancy Certificate.Complications of not having OC is very serious, just refer following link.

  5. George Abraham says:

    The above article is a 2009 article. Five years have gone by and nothing has changed. Electricity is something that the builder manages by bribing BESCOM. BWSSB is something that does not exist for 70% of Bangalore. Piped water is a pipe dream and a proper sewage system plan is floating in one of those open drains of Bangalore.

  6. bangalore citizen says:

    There is a law, and if you violate, its offence. Though not now , but sometime in future, you don’t know. Simple example is Campa Cola, people purchased flats knowing there is no proper approvals thinking nothing is going to happen, and after 30 years they are in trouble.

  7. George Abraham says:

    Violation and deviation has a thin dividing line. If the builder has built a penthouse which was not part of the plan, it’s a violation. If the gap between the boundary wall and the building is lesser than the norms, it’s a deviation. The question is, what happens if and ever law catches up? Will BBMP fine the entire apartment for the huge deviation that exists because of the pent house or will they demolish the pent house and only penalise the flat owners for the deviation that exceeds five percent?

  8. bangalore citizen says:

    BBMP has all rights to demolish the deviating portion or building as well as portion which is not part of the approved plan. Some cases BBMP may regularize certain deviation through fine. But it all depends, for example, apartment deviated in such a way that it has encroached water flow, in this case there is no excuse.
    But again, we can’t predict, there are some examples, where government has come heavily on authorized apartments due to some incidents such as collapse of poorly constructed apartment which resulted in heavy loss of lives.

  9. George Abraham says:

    I would love to see unauthorized pent houses demolished and flat owners spared from paying a steep fine for no fault of theirs. Constructing over drains, lakes and other forms of Govt. property is a clear case of encroachment. Such incidents are very less. This article is about occupancy certificate. And my argument is that buildings having deviations (not enough space between the wall and building as per current norms) but built on land with proper titles should not worry much about this article.

  10. CPrabhu says:

    I agree with both @George Abraham & @bangalore citizen as they are right in their line of thinking:
    1) BBMP is entrusted with the purpose to uphold the law in the jurisdiction of Bangalore. Occupancy Certificate from this body allows for Khata Creation. The certificate is provided in apartments especially by branded developers and in several cases randomly in select projects where developer and BBMP have reached some type of understanding (Note: I leave it to your imagination.)
    2) BBMP has failed till date to uphold and follow the vision and values listed in KMC Act (Note: Just look around you and recollect number of demolitions/notices handled by this body till date. I am sure it would be miniscule.) and majority elected representatives (State/Central Government or BBMP) till date prefer (Note: Not publically) to amend the KMS act e.g. Akrama/Sakrama or to replace the KMC act itself with a new one e.g. Proposed by Mr. Reddy when judiciary rejected BBMP Akrama/Sakrama amendments recently.
    3) My view is simple, Old Bangalore Properties e.g. Upto 12KM radius from Vidhana Soudha, and here Upto 70% Properties would not have Occupancy Certificates from BBMP and it is for these & other properties beyond the radius that a new act from Mr. Reddy is on its way.
    4) In summary, people have to make a choice a) Compromise (e.g. Travel duration etc.) & live in a place e.g. apartment or gated community where emphasis & vision has been 0 deviation policy not because of the procedure but because it ensures good living experience e.g. Good sunlight, Open spaces etc. and all approvals/certificates are an added benefit b) Live in Old Bangalore where you will still Compromise (e.g. Pollution caused by unplanned construction) but you may gain in other areas e.g. Travel times etc.
    5) Following may summarize the situation: Majority Corrupt Governing institutions that have no values & who write improper acts + Majority Divided Citizens who are least bothered= Chaos

  11. suna miandad says:

    well well. i just read all the above post. yes in every way George Abraham & @bangalore citizen and cprabhu are right i their own way. i would like you all to know that each and every one planning to construction a house or commercial or wat ever need to apply for a sanction plan and should adhire with same at the time of costruction. but my point here is that each and every one be it a person building in 20×30, 30×40, 40×60 etc does deviation. for a 30 feet road u get approval of ground and first floor only with 5 feet set back at the least in all four corners.i have seen that no one follows the set back and also have seen 5 to 6 storied building. does that mean that 95% of the residential building will be demolished? and more over if the builders dont make deviation then the actual cost of the same flat would become one and a half times or two times of the value the builder will be selling with deviations. this is the explaination i got from a fren who is a builder. infact he also told me that if the buildings are made with out deviations then the common man can not even plan to buy a flat as it would go beyond his budget.


    No doubt the responsibility of procuring occupancy certificate lies with the Builder Developer.The builder must have obtained the approval of the building plan from the local authority and after completion of the construction must have applied for completion certificate from the the authority who had initially sanctioned the building plan. In the case of violation / deviation from sanctioned plan, the authority must reject the application of builder by issuing official rejection letter. In absence of rejection letter by local authority in reasonable time, the onus lies with local authority, and in such scenario local authority legally can not initiate any legal action against occupants of a building which do not have occupancy certificate .
    The campa-cola case was different and it can not be compared with issue of completion certificate and resultant complication like demolition , eviction etc. In the campaign-cola case BMC had issued rejection letter followed by notice, against which the affected parties fraught a legal battle against BMC instead of making builder-devloper as parties in the court case. Taking advantage of innocent occupants the builder has tactfully kept himself out from the controversy by diverting the issue between flat occupants and BMC.

  13. V Shyamsunder says:

    I am surprised that no one has even touched upon the possibility of initiating legal action against the builder/developer. If getting an OC is the builder’s responsibility, then isn’t the flat buyer justified in holding the builder responsible for the lack thereof and moving the court to impose heavy penalties on him. This is the only step that will serve as a deterrent.

  14. Aurnob C says:

    As I’m interested in purchasing a “clean property” in Bangalore – that which has a CC and a OC, I ask the Builders to provide a “OC clause” in the Sale Agreement that penalizes them against violation/deviations. I put the clause below – so as to spread awareness among other buyers too!

    “Occupancy Certificate:

    A) That the Builder has/is hereby committed to hand over a copy of the Occupancy Certificate issued by the Municipal Corporation for the , to the Purchaser on or before ____ . That if the Builder fails to meet such commitment, the same date shall be deemed as date of default of handing over of the Occupancy Certificate by the Builder.

    B) That the Builder before or after acquiring the Occupancy Certificate from the Municipal Corporation, shall not add or alter materially, the structure or a part of the structure thereof for without specific permission of the Municipal Corporation OR default on any of the conditions mentioned in the Occupancy Certificates, including but not limited to adding more floors other than that approved by Municipal Corporation OR constructing any more saleable area in addition to that approved by Municipal Corporation, OR altering the use of terraces or water bodies or roads inside the project, thereby rendering the Occupancy certificate(s) cancelled or withdrawn by the Municipal Corporation. The date on which the Builder performs such deviation, thereby rendering any of the Occupancy certificate(s) cancelled or withdrawn by the Municipal Corporation, shall be deemed as date of default by the Builder for this clause.

    C) That the Builder, in the event of any of the defaults mentioned in A) or B), shall pay to the Purchaser, inspite of arbitration clause,:

    i) one time penalty of 30% of the the amount mentioned as sale price for sale of Property, as damages towards loss of property valuation due to irregularized building AND in addition,

    ii) 18% per annum of the the amount mentioned as sale price for sale of Property, from the date of default, whichever date is the earliest default applicable in A) OR B) to the date such irreguarized building is regularized by the Builder at is cost.”

    Disclaimer: I still have to come across ONE Builder in Bangalore, who has agreed to my OC clause in the sale agreement. There are many who verbally make tall claims of providing an OC – but once they read about the OC clause – they stop responding to my emails 🙂

  15. Girithara Ramkumar says:

    I really appriciate the way you are helping the customer on the right path for buying a property.

    Am going to finalize a 2 bhk appartment from DS Max property in Gunjur palaya road, its a OC , CC project,they have obtained CC certificate, the cost comes around 36 lac, where there are few Land owner flats are available where they are offering with lesser cost compare to builder ( 32 lac ).

    Note :That land belongs to Land lord & the sale deed is between the land lord & builder only.

    Since land owner flat is cheaper than builders price am interrest to buy a property there.

    Since they are offering at lesser price i have an doubt whether any problem comes & what could be the pros & cons behind that. Kindly guide me .

  16. Rajesh says:

    If one starts violating the law for some sake, it would become a habit to others to save some little amount. If everyone follows the law, there wont be question of cost. Cost is all ways depends on the Demand and Supply. If no one affordable to purchase a house with no deviations and there are no deviated/violated properties, automatically property value should come under the affordable price.

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