Answers to Top Legal Questions when Buying a Home

Whether you purchase a ready-to-occupy home or one that is under construction, there are always a few legal tangles that may occur. We speak with Suparna Umashankar, who leads the real estate team at Legal Torque, a Bangalore-based law firm on the subject,and answer a few common queries that home buyers have:What is my legal recourse if a builder has taken an advance and has not completed work on different slabs as promised? Is there are way to ensure he does or can I secure a refund? Suparna Umashankar (SU): The collection of advances depends on the credit worthiness of the developer or the stage of construction that the building has completed. Usually, there are slabs for payment with respect to an on-going construction. They are : 

• First stage or the advance payment stage.
• The completion of slab work is another stage and may be taken as the completion of the roof of each of the floors.
• Sale deed registration is another stage and indicates that the apartment is ready-to-occupy.
• Completion of common areas is a stage where areas that all the occupants of an apartment have access to is done. Each of these stages is outlined in the sale deed.
• Final payment is done at the stage of execution and registration of the sale deed.

You may approach the consumer courts or file a civil suit for damages if the builder has delayed completion and handing over of the apartment. Approaching consumer courts is proven to be a quicker process involving much lower expenses.What can I do if a builder raises a demand note for provision of amenities but has not completed slab work yet?SU: A demand note outlines the payment of amounts according to the construction agreement.  The demand note should always be in keeping with the terms agreed upon, each time it is raised. You may always refuse to pay if you find any contradictions to the agreed terms.Tricky areas are bills related to electricity, amenities etc. These need to be clearly defined in the agreement itself. Developers usually keep payments for amenities apart from the payment slabs for consideration and construction. This being the case, you cannot disagree to pay for amenities as and when approached for it. Negotiations relating to the same depend on the credit worthiness of the developer.  Near completion of slabs is not completion of the building.  Even after the BBMP hands over a completion certificate, a period of one year is set aside as a defect-rectifying period if any is found.How do I ensure payment is released only on completion as per the actual agreement?SU:This may be done by imposing appropriate clauses in the agreement with regard to payment and its stages. An example of an important one is to state that “You are not obliged to entertain any payment demands which are contradictory to what has been agreed in the construction agreement.”What is my legal recourse if I move into the flat and then find the quality of work below what has been promised and certain facilities and amenities completely missing?SU:You are entitled to move the consumer forum for the purpose of seeking damages against the developer. You can also approach the City Civil Court for specific performance against the developer for a direction to rectify the defects at his costs and also for damages.There may be several financial offers that accompany buying a home under construction. For the potential buyer who is working on a budget, these homes are a great way to invest, However, being aware of what your contract entitles you to – as a buyer releasing payments at various stages, is important. You must not be pushed into making decisions that are not essentially part of the process.