Legal Remedies

PUBLIC NOTICE IN VIJAY KARNATAKA


Since the  Developer had delayed the project beyond the time limit as per the Joint Development Agreement ; Landowner Mr.B.R.Shetty has gone ahead and revoked the General Power Of Attorney given to M/s Nitesh Estates Limited. Landowner has given PUBLIC NOTICE in the  Newspaper – VIJAY KARNATAKA dated March 20th 2018 (Page 7) as below:-

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PUBLIC NOTICE


Since the  Developer had delayed the project beyond the time limit as per the Joint Development Agreement ; Landowner Mr.B.R.Shetty has gone ahead and revoked the General Power Of Attorney given to M/s Nitesh Estates Limited. Landowner has given Advertisement in the  Newspaper – Times of India  dated March 20th 2018 (Page 9) as below:-

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PUBLIC NOTICE PUBLISHED IN “VIJAY KARNATAKA” ON JUNE 10th 2017 & “DECCAN HEARALD” on June 17th 2017


NCPBA thanks  all the members who have joined together to fight for their flats which are not  completed as yet by Nitesh Estates Limited. As per the court order to publish the public notice , we have published the same notice in “Vijay Karnataka”  as below –
Our Submission of the consumer case was challenged on the grounds whether it qualifies to be entered under Class Action Law Suit under section 12(1) C of consumer protection act 1986 or not by Nitesh Estates Limited. The court has ordered in favor of the Nitesh Caesars Palace buyers and has also issued the order to issue a public notice in leading newspapers. We invite all the buyers in the Nitesh Caesars Palace project to be part of consumer case to ask for their rights and early completion of their flats.
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If people who are left out of this 250  list , still wish to join the consumer case can contact us at ncpbassociation@gmail.com  or to Mr.Vishwanath @ 9845008469 or to Mr.Rajesh – 9845274728.

NCPBA doesn’t wish to leave out any buyers stranded alone , fighting alone for their own flats with Nitesh Estates Limited.

If any questions or any difficulty , please feel free to call or mail us.
As per the court order , we would like to invite all other buyers from the project “NITESH CAESAR’S PALACE” to be part of the consumer case and ask for their rights.

Regards ,

NCPBA

Download News Paper Clip – “VIJAY KARNATAKA JUNE 10TH.2017”  & “DECCAN HERALD JUNE 17,2017”

 

The Execution Of Power Of Attorney Outside India And Its Use With Reference To International And Domestic Laws


A “power of attorney” is a legal instrument whereby one person gives another person the authority to act on his or her behalf as his legal representative, and to make binding legal and financial decisions on your behalf.

Important Facets of the Power Of Attorney

 

  • Legal representation
  • Limits imposed
  • Time frame
  • Scope of the draft

The present question is regarding the validity of passing of a power of attorney executed outside India. The value of a deed of power of attorney executed outside India is proven through a process called Apostallisation passed under Hague convention of 1961. Under Article 1 of the treaty:

  1. All the registry entries of a notary public and official certificates signed under the private capacity certifying registration,
  2. Notarisation and authentication of documents are treated as public documents, which are available for public inspection.

Method 1: Legalisation

 

A deed of power of attorney is framed complying with laws of both the countries involved. (In the present case USA and India) The deed is made sustainable to legal challenge by notarising it from the authorized officer in the Indian Consulate/Embassy as he is a valid notary under Indian law under section 3, Diplomatic and Consular Officers (Oaths and Fees) Act, 1948.

Once the deed is executed from the embassy, it is sent to India for registration along with all the signatures and the payment of stamp fees according to section 2(17) along with schedule I of Indian Stamp Act, 1899. Once registration is done under the adjudication of the sub-registrar, the legality of document can be proved in the court of law beyond all reasonable doubts.

Ministry of external affairs, Government of India has issued a notification L161/1/2003 In March 31st 2006 accepting the Hague convention and entering into force for India on 14th July 2006.

Method 2: Apostallisation

 

It is much simpler process but with a certain degree of doubt and suspicion surrounding it. For making a deed of power-of-attorney which is valid in India from USA, firstly a deed must be executed according to the law of the state where you are residing in. The grantor shall comply with all the legal requirements under US laws and Indian laws, so that there won’t be any difficulty in legally enforcing it in India.

The next step is to approach the U.S. Department of State Authentication Office to get an apostille stamp affixed in the document. If the deed complies with all the requirements set forth by Section 17 (b) and 33(c) of the Indian Registration Act, 1908 and Section 2, Power of Attorney Act, 1882 along with payment of required stamp duty, it shall be registered and can be considered as a valid power of attorney in India.

FAQs

 

1)      What value does the verification or attestation of a foreign notary hold in India?

Ans: According to the section 14 of the Notaries Act of 1952, if the central government is satisfied that by law or practice of any country or place outside India, the notaries act done by notaries within India are recognised for all or any limited purposes in that country or place, the Central Government may, by notification in the Official Gazette, declare the notarial acts lawfully done by notaries within such country or place shall be recognised within India for all purposes or, as the case may be, for such limited purposes as may be notified in the notification.

Thus it is perfectly valid.

2)      Is registration required for this deed?

Ans: Yes, registration is must for this deed of power of attorney, as under Section 17 of the Indian Registration Act, 1908 it is required that all non-testamentary instruments which purport or operate to create, declare, assign, limit or extinguish, whether in present or in future, any right, title or interest, whether vested or contingent, of the value of one hundred rupees, and upwards, to or in immoveable property, must be registered for ensuring its legal validity.

3)      Is Hague convention ratified in India?

Ans: Hague Convention is in force in India since 14th July 2006. It is upheld by an amendment in Diplomatic and Consular Officers (Fees) Rules, 1949 under Section 8 of the Diplomatic and Consular Officers (Oaths and Fees) Act, 1948 whereby the Central Government is allowed to make rules accordingly.

Section 14 of the Notaries Act of 1952 read along with the section 33(c) of TheRegistration Act, 1908 gives the discretion to the Central Government to recognise the acts of foreign notaries if found satisfactory. It will have the same effect of an act done by an Indian notary.

4)      Why there are two methods of certification?

Ans: The first method is older and lengthy, when compared to apostillisation process. The public seems to prefer the simpler method. But, in the actual practice, the newer process is no less cumbersome than the old one, as only difference is a mere change in the office where you get it done. And further adding salt to the injury in the second case, the grantor has to make sure that both the laws are complied with, whereas in the legalisation, Indian law is the only one to be complied with.

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Acts, Legislations & Rules

THE BEGINNING OF CLASS ACTION LAWSUIT “REAL ESTATE”


  • All home buyers can join a existing complaint filed

  • Judgement of the case will be binding on all the buyers

  • Only one complaint to be filed against the Builder /Developer Under Section 12.1 C as a group of buyers

  • All other complainants can  join as a group after the Public Notice is served

  • Judgement to be based on Agreement Value and not Market Value

The NCDRC have clarified its position on Section 12 (1) (c) of Consumer Protection Act 1986.  NCDRC has allowed complaints by a group of buyers under Section 12 (1) (c).

If we have to go by layman’s interpretation, all builder related cases can by filed in NCDRC, thus skipping the lower forums.

There has been a lot of confusion and ambiguity in the interpretation of complaints filed under Section 12 (1) (c). Different benches of NCDRC had a different view on this section of the Act.

This led to the matter being referred to a three-member bench of NCDRC. These three question/issues arose in front of the commission: Whether complaint under Section 12 (1) (c) filed on behalf of or for the benefit of only some the numerous buyers are maintainable or it must be filed on behalf of all consumers having a common interest.

Where complaint under this section is maintainable where the value of goods, service, compensation in respect of none of the allottees exceeds rupees one crore.

Where complaint under this section is maintainable where the value of goods, service, compensation in respect to individual allottee exceeds rupees one crore.

Where complaint under this section is maintainable where the cost of the apartment, the area of the apartments is different and the apartments were booked on different dates.

Court’s observation

Here are the key observations in full bench judgement concerning the interpretation of Section 12 (1) (c) of the Consumer Protection Act. We have tried to explain court’s order in laymen’s terms.

  •  If a complaint is against a builder under Section 12 (1) (c), i.e by an unregistered group of persons, it can be filed only on behalf of or for the benefit of all buyers who have the same interest and grievance against the builder. It cannot be filed seeking relief for the benefit of only some of the buyers.
  •  A complaint under Section 12 (1) (c) is maintainable before the NCDRC where the aggregate value of the all the apartments combined and the total compensation claimed in respect of all the buyers exceeds Rs. 1 crore. The value of each individual apartment is wholly irrelevant in such a complaint.
  • So long as the grievance of the buyers is common and an identical relief is claimed for all of them, the cost, the size, area of the flat/plot and the date of booking/allotment/purchase would be wholly immaterial. The relief claimed will be the same if for example, in a case of delay in possession, refund, or possession or in the alternate refund, with or without compensation, is claimed for all the buyers. Different reliefs for one or more consumers on whose behalf or for whose benefit the complaint is filed cannot be claimed in such a complaint.
  • The jurisdiction of the NCDRC shall be decided on the agreed sale consideration ,i.e.value at the time of booking the apartment, not the market value of the apartment. e. A cooperative society or a group of cooperative societies, firms, an association shall not be entitled to file a complaint under Section 12 (1) (c) unless the cooperative society itself is the consumer.
  • The Act does not allow more than one complaints in a representative character. The decision in one complaint filed in a representative capacity will bind all the buyers of the project. Therefore once a complaint in a representative capacity is filed under Section 12 (1) (c), and requisite permission for filing the same is given by the consumer forum, the second complaint under Section 12 (1) (c) will not be maintainable for the same project for the same relief. A second complaint, if filed, having the same interest and seeking the same relief is liable to be dismissed with liberty to seek impleadment in the complaint already instituted.
  • Since a complaint in a representative capacity shall be binding on all the buyers, an individual complaint expressing the same grievance will not be maintainable and the only recourse available to such buyer is to seek impleadment in the complaint filed in the representative capacity. However, as far as individual complaints instituted prior to grant of requisite permission under Section 12 (1) (c) is concerned, such complainants cannot be compelled to withdraw their individual complaint.
  • The consumers who are already before the consumer forum when the requisite permission in terms of Section 12 (1) (c) is accorded, will be out of purview of the representative complaint. The order passed in the representative complaint will not be binding on them.
  • However, if such persons want to withdraw their pending complaints and join the complaint instituted in the representative capacity, there is no bar on their adopting such a course of action. h. Considering the binding effect of a decision rendered under Section 12 (1) (c) on all the consumers on whose behalf such a complaint is filed, even if they choose not to join as a party to the complaint, It is necessary to exercise due care and caution while considering such a complaint while granting the requisite permission under Section 12 (1) (c).
  • It would be necessary for the bench to either give individual notices or an adequate public notice of the institution of the complaints, to all the persons on whose behalf or for whose benefit the complaint is instituted. Such a notice should disclose the subject matter of the complaint including particulars of the project, class of persons on whose behalf or for whose benefit the complaint is filed, the common grievance is sought to be addressed, the alleged deficiency in the service and the reliefs claimed.
  • It will also be necessary to hear the opposite party before taking a final view on grant of necessary permission under Section 12 (1) (c).
  • Court’s observation on existing complaints Individual complaints filed prior to the grant of requisite permission under Section 12 (1) (c) have been validly instituted and they can not be compelled to withdraw their individual complaint and compelled to become a party of subsequent complaints filed in a representative capacity. If, however, such persons want to withdraw their individual complaints and join the representative suit, they shall be allowed.
  • JUDGEMENT CAN BE FOUND BELOW ON SECTION 12 (1) (c)
    ncdrc-full-bench-judgement-on-section-12-1-c
  • Example of a similar order pass by the consumer court in Case of Nitesh Caesars Palace :-
  • The instant complaint has been filed by Shri Vishwanath Shankar and 203 other complainants as a class action alleging deficiency in service on the part of the opposite party in respect of the builder buyer agreement executed by the complainants and other consumers with respect to the development project ‘Nitesh Caesar Palace’ undertaken by the opposite party. Along with the complaint an application under Section 12 (1) (c) of the Consumer Protection Act, 1986 seeking permission to proceed with the complaint as a class action, has been filed. The application is opposed on the ground that even among 204 complainants there are different groups of complainants having different interest.

    We have heard the parties and perused the record. On careful perusal of the complaint we find that in para-1 the complainants have specifically mentioned that they wish to proceed with the complaint as a class action on behalf of themselves and other similarly placed consumers having the same interest and even in the prayer clause the complainants have sought similarly relief for all other consumers who are not party to the complaint. Therefore, in our view the complaint fits within the parameters of Section 12 (1) (c) of the Act. Accordingly, we grant permission under Section 12 (1) (c) of the Act to the complainants to proceed with the complaint as class action. As this is a class action complaint, issue public notice under Order 1 Rule 8 CPC in Deccan Herald (English) and Vijaya (Karnataka).

Banks Can Come After Your Assets If The Builder Defaults


reduce-the-tax-on-property-rentalLet’s say you’ve taken a loan for a house on the 10th floor of a building, under construction. Let’s say you’ve gone for the 80:20 scheme, where you’ve paid 20% and the builder says he’ll pay the EMI on the 80% until construction is complete. Let’s say that the builder runs out of money – maybe because interest rates are too high, maybe because he couldn’t sell the remaining flats, or maybe because of the Realty Ponzi scheme.

Either ways, he throws up his hands and says he can’t finish the property. Six months pass, and there’s no sign of any action. The bank now says you have to pay the EMI on the 80%. What happens now?

Many people believe the bank should take over the property and recover the money, and your EMI is no longer applicable. This is a gross misunderstanding.

You are fully responsible for the loan repayment.

Remember, the builder has taken his money. The bank has given it. The loan was given to you, not the builder, against your earning capacity and the collateral of the property.

When the builder was paying the EMI, the bank didn’t care – it had given you a loan, but the builder was paying interest.

When the builder stops paying interest, it will ask you to pay instead.

If you decide not to pay, the bank will attempt to sell the property. It is unlikely that people want to pay full price for a stalled project, and there will be a shortfall (auction amount could be less than the total loan). You have to now make up the difference, immediately, including all interest accrued in this sale/waiting period.

If you do not, you will be labelled a defaulter under CIBIL. (You might already be notified before the bank attempts to sell). This affects your ability to get a loan in the future.

And then, the bank can go after your other assets under the SARFAESI act. This includes all possessions you own like a car, another property or such. Further if the loan is taken jointly in the name of your wife or parents, their properties too are at stake. Personal/Home Loans in India are “full recourse” , where the bank or financial institution has full recourse to your other assets in case of a default.

The only thing a court cannot attach (to pay back such a loan) is your Provident Fund (PF) account. (I may not be legally up to date on this, though)

This applies to 80:20 loans (where the full amount has already been disbursed) and to regular home loans (where only partial disbursement has happened). This also applies to loans where you have been paying the EMI – you are still responsible for the rest of the loan.

Your options are to “settle”, hoping that the bank doesn’t want to go through the long legal process. The other option is to stall through the legal process, hoping that this will just go away, considering the extreme delays in our legal system. (This will still impact your CIBIL score) Since technically the builder defaulted to you, you have to take legal action against him for any further recovery.

(In one such case, a builder in Kolkata defaulted on a 176 cr. loan, and the bank is likely to take over the project and sell the flats. The case is still evolving.)

What this means is: Do not assume your responsibility ends if the builder defaults and bank takes over the house. You have a liability to pay anyway, your other assets can be attached and you will get a hit on your CIBIL score.

Read Original Article – Click Here

Real Estate Bill- How it will help home-buyers


The much awaited Real Estate Bill, which aims to protect the interests of buyers and bring more transparency to the sector was on Thursday passed in Rajya Sabha.The bill was first introduced in 2013 and amendments have been made to it by the present government.

 The Finance Ministry in 2012 paper on black money had pointed out that the real estate sector is vulnerable to black money because of under-reporting of transactions.
Here are some important features of the bill:

Better organised real-estate sector

The real-estate sector in India is unorganised which leads to various discrepancies in the functioning. The bill will establish state-level authorities called Real Estate Regulatory Authorities (RERAs) which will regulate transactions related to both residential and commercial projects. The authority will grade the projects helping customers to make better decisions.

Timely completion and hand-over

One of the problems which buyers face is that they don’t get possession of property as promised by the seller because of delayed construction among other issues. The bill ensures that 70 per cent of the money taken from buyers has to be kept aside in a separate bank account and this money can only be used for construction activities. This will ensure that the sellers don’t invest the money received from one project into another project.

Accurate information

As per the bill, it will become mandatory for sellers to disclose all information like project layout, approval, land status, contractors, schedule and completion of project with customers as well as the RERA.

Appropriate punishment

If the developer fails to hand-over the property to the buyer on time, then he would be liable to pay same amount as interest which he is charging from the buyer on delay in payment. Also, the property cannot be sold on the basis of ‘super area’ which includes both flat area and common area. If the developer violates the orders of appellate tribunal, then he/she can get a jail term of up to three years or penalty.

Allottees association and after-sales service

It has been made mandatory to set-up an allottees association within three months of the allotment of major units/properties so that the residents can manage common facilities like a library and a common hall. Also, if the buyer finds any structural deficiency in the property, then he/she can contact the developer for after-sales service within one year of possession. The promoters or developers cannot make any changes to the plan without consent of the buyer, the bill states.

– See more at: http://indianexpress.com/article/india/india-news-india/real-estate-bill-to-be-tabled-in-rajya-sabha-today-heres-how-it-will-help-home-buyers/#sthash.StFFFPud.dpuf

Magic Bricks Now – Questions by Mr.Vishwanath – Nitesh Caesars Palace


Lawyers suggestion key points:
  1. Buyers association either registered or unregistered can represent the case. However, registration would give more benefits so  the builder is forced to talk to one identify who represents buyers benefit. Builder will naturally respond / negotiate once an association is formed.
  2. Registration can be done before Occupancy Certificate (OC)  but need to get the sale deed clearly checked line by line, by lawyer on this channel showed his suspicion of only 2 blocks ready out of 8 blocks: chances of many issues. Registration agreement needs clear scanning by lawyer to avoid future mistakes as the project isn’t complete.Buyer can register the property but do not tie registration to OC as that will clear all the uncertainty of owning the flat.
  3. Possession without OC is at builders cost. Builder is liable to bear all cost such as taxes, power, maintenance etc. Buyer can take possession if builder is giving alternate power but should be at his cost not owners.
  4. Maintenance agreement: There is no legal binding to sign any maintenance agreement during registration you can deny as it is one sided. Strictly No to maintenance agreement of 10 yrs..Builder cannot enforce this for signing. Demanding 1 year maintenance cost in advance is ok. Maintenance payments to be in the name of different or specific bank account. Need not pay more than 1 year.
  5. Arbitration clause is not applicable for filing case in consumer court. There is only consumer court for this issue and can be through association and effective through association rather individual. Interim relief for completion of amenities/services can be claimed at consumer forum.

Social media activism against builders and defamation suits


One of the good thing that has happened to Real Estate market in the recent past is online presense of both Home Buyers And Developers. While home buyers have been actively using social media and forums before making property related decisions, builders are using similar platforms to advertise and reach out to prospective buyers.

Understanding the potential of social media, most of the big developers started reaching out to young professionals through online platforms. From creating dedicated project pages on Facebook to twitter handles and uploading 3D videos of sample flats on youtube channels became the new fashion. A big chunk of marketing budget was being spent through PR agencies to increase online presence and trap as many buyers as they can.

After 6 years, the very same social media users are hitting back. Social media platform like Facebook, Whatsapp and twitter have come to the rescue of home buyers and have played a major role in homebuyers fight against injustice and unfair practices.

Social Media Activism

There is no denial that builders have exploited homebuyer in this country since the inception of group housing. Even the Prime Minister, Mr. Narendra Modi said:

“In our country, wittingly or unwittingly, the image of builder lobby is bad.

Prior to social media, It was very difficult for the home buyers to join hands and raise their collective voice against the unfair treatment by builders. Most of the time individuals were cornered, threatened and coerced to give up their rights.

However, all of this have changed now. Angry home buyers are no longer hiding or afraid to take on the might of developers for delaying the delivery of apartments and villas and changing building plans. They are banding together to fight for their homes using all the means at their disposal, including staging unique protests at project sites and going to court.

Most of the buyers groups have online Facebook or Whatsapp groups to easily highlight the wrongdoing of builders. In the past, most of the home buyers groups have managed to stop lot of wrongdoings of the developers and have been able to give them sleepless nights. In one of the Noida builder’s project, more than 300 home buyers got together on Facebook and filed a case of deficiency in service in NCDRC. There are host of buyer’s association who are bringing in people together in ensuring they are not cheated anymore.

SLAPP / Defamation Suits

Builder don’t like to answer a crowd as they find it easy to coerce individuals. Home buyers group have been a nightmare for them for obvious reasons. Because they find it difficult to mend their ways and do business in ethical way, they engage in something called Disreputation Management. Disreputation management is the practice of ensuring the content that a builder ddoesn’t’t like, should be removed from the web. Most of the content is usually some home buyer unearthing illegal practices of a developer.

So, to deal with the social media activism, builders have started filing a SLAPP (Strategic Lawsuit Against Public Participation) suit with the intention to silence, censor, and intimidate buyers concerned with ‘deficiency in service’ and ‘unfair trade practices.  Builders alleged that social media groups have damaged their standing and reduced business opportunities. By filing such cases, they seek crores in damages for loss of reputation and business from home buyers.

What should a Home Buyer do

Buyers are finding comfort in unity and there is no harm in being united. Social media is a great tool to ensure errant developers are brought to the task. While it is good to raise a collective voice and fight for your rights, there are few measures that home buyers and Group Admins must take to ensure builder does not engage them in defamation suits.

  • One should be factual about the content. Ensure if you are accusing builder of some wrongdoing, you have content to back your claims.
  • There is no harm in criticism but do not abuse anyone on the forums.
  • Use RTI to know the facts before alleging someone of corrupt practices.
  • Avoid posting information received from word of mouth.

Individuals should be careful while posting forward contents. After recent Nepal Earthquake,  pictures of an apartment complex labelled as noida society were doing rounds. Builder had to issue a clarification because it did not belong to their project and it was a complex in Nepal.

Should you be afraid? 

Builder’s aim by filing defamation suits is to silence the home buyers voice. If you have raised your voice against wrongdoings of the builder, there is no reason to be afraid of. Home buyers have taken a tough stand against such practices of the builder and are fighting such cases in various court. Some of the home buyers have given it back to builder’s by filing cases of deficiency in services in appropriate courts.

Legal View: 

Sahil Sethi, a lawyer defending home buyers in defamation cases says, ” it’s important to ensure that all comments made on social media complaining about a developer are fair, even if not absolutely factually correct.  Buyers should also refrain from calling names or hurling abuse on social media.”

The Logical Buyer suggests that home buyers should not bow down to such threats from builders and continue their fight against wrong practices. At the same time, one must act responsibly and should not indulge in unwarranted accusations. Home buyers association must ensure they stand by those who take the lead and raise their voice against builders.

Read more details:http://www.thelogicalbuyer.com/social-media-activism-against-builders-and-defamation-suits/