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A clash of interests

Can a group of residents in a housing project work in favour of a builder?

realestate Updated: May 07, 2014 20:40 IST

They say they want to live in the apartments they have bought in two residential towers ordered to be demolished by the Allahabad High Court (HC) recently. The 10 apartment owners in the new Supertech Emerald Court towers have also blamed residents of the old towers for not warning them about the legal issues that led to the demolition order.

According to the new buyers, the Emerald Court Residents’ Welfare Association (RWA) had gone to the Allahabad HC against the builder because of “vested interests.” They say there is no violation of any building plan and that the towers are “fit for delivery.”

Countering the charge, the Emerald Court RWA members allege that the buyers are the builder’s proxy candidates and have approached the Supreme Court (SC) with “matters related to the developer’s interests”.

“Out of the 600 buyers in the new towers, how could the developer manage to convince just 10 to file a petition in the SC to retain their apartments and pursue his own agenda? I don’t understand why these buyers are so keen to live in the two new towers when the Allahabad High Court has said that these are illegal and unsafe,” asks BV Raisinghani, Emerald Court RWA member.

Those following the Supertech Emerald Court should know that there are two groups of homebuyers in the project fighting for justice. One group, already living in the society, wants the new towers demolished because of building violations; and the other group, comprising new buyers who have yet to move into the new towers, do not want their buildings to be razed to the ground. It’s the latter group that filed a plea in the SC recently for retaining their properties.

It is not unusual to witness friction between buyers in one society. A number of cases also exist in Ghaziabad and Noida of two RWAs being formed in one society. One group furthers the cause of the builders and the other comprises genuine end-users. To have more than one RWA for a project, interestingly, is a violation of the Uttar Pradesh Apartment (Promotion of Construction, Ownership and Maintenance) Act 2010.

“Some buyers in a group housing project have close ties with a developer and form an RWA with the developer’s help, to ensure his interests are protected. Building violations, if any, are ignored. For this the developer at times offers them petty benefits such as extra car parking or club memberships,” says Shobhit Jain, member of one of the two RWAs in a group housing society in Indirapuram. Many developers do not want to hand over common areas and facilities and maintenance to the RWA because they earn profits from the maintenance charge and can use the common area for their own benefits, at times even build a structure there and not face any opposition from an RWA under their control, Jain adds.

Residents who are not a part of the developer’s RWA and who are seriously concerned about security, maintenance and structural issues, then set up their own RWA. “When the residents’ RWA wants to take control of maintenance, the developers’ RWA objects to it. In some cases the developers have handed over maintenance to RWAs they themselves have floated,” says Harshvardhan, RWA member of a group housing project in Indirapuram

What is the way out for the genuine RWA members? As two RWAs are illegal according to the UP Apartment Act 2010, the Registrar of Societies should give permission for the setting up of just one RWA in one group housing project, say legal experts.

According to section 14(2) of the UP Apartment Act 2010, “It shall be the joint responsibility of the promoter and the apartment owners to form an association. The promoter shall get the association registered when such number of apartments have been handed over to the owners which is necessary to form an association or 33% of apartments, whichever is more, by way of sale: transfer or possession, provided the building has been completed along with all infrastructure services and completion certificate obtained from the local authority.”

When contacted Devesh Yadav, deputy registrar, Registrar of Societies, Meerut, dismissed the charge of illegal RWAs and said those that were still functioning had been registered before the UP Apartment Act 2010 came into force.

“According to the Societies Registration Act of 1860, the two conditions for registering an RWA are that it must have a group of seven people and a unique address. So there have been instances of two or more than two RWAs getting registered in one group housing project, but since the UP Apartment Act has come into force we haven’t registered two RWAs in a group housing project,” says Yadav.

While admitting that there was no way in which registration of two RWAs in one project could be checked, Yadav said, “Residents can complain to us in such a cases. They can also file a complaint with the competent authority of their area who can forward it to us. As of now I have not received any such complaint.”

However, homebuyers from many group housing projects with multiple RWAs allege that they have repeatedly complained to the Registrar of Societies about the issue but no action has been taken as yet.