Overview of Problems at Apeksha residency

Background:

We, the buyers of flats in Apeksha Residency had no say in the business of builder Mr.Ganesh Shetty. We have never asked the builder to go against the rules of MCC and laws of the country. We are not business partners of the builder. Delay in construction was due to his discretion of deploying his workforce to other project, thereby neglecting completion of Apeksha Residency.

HISTORY OF THE PROBLEMS:

1. Purchased undivided right and entered into agreement to construct as per plan and license no Building license no: E4-BA 224/04-05, Application no. 709/04-05 dated 30-11-2004.

2. The license stipulates the builder to complete the construction by 29-11-2006. As per the agreement for the purchase of an apartment with undivided right of land, the completed apartments will be handed over by the end of August 2006.

3. The building was not ready even after December 2006. The builder went on giving excuses for not completing the building on time. Kindly note most of us were staying in rented house at the same time we were paying interest on the housing loan. Hence, delay in construction increased our financial burden.

4. The builder sent us individual letter (dated 5-3-2007), confirming completion of building and therefore it is ready for occupation. He assured us that entire set of documents would be made available very soon. Based on this letter and assurance, we started to occupy the flats from April 2007 onwards, one by one. Later on in his letter dated 12-01-2008 again he repeated his promise. Having paid huge sum of money, we are left with no option but to trust him for his promises and assurances.

5. On 6-1-08 we observed some construction activities at the car parking and understood that it is supposed to be the office premises for the builder. We realized that this construction is an unauthorized one and not according to the approved plan. Immediately we approached then commissioner of MCC and he was kind enough to send the ATPO and ask the builder to stop the construction.

6. MCC has issued notice to the builder on 10-01-2008 clearly mentioning that there is a violation of car parking area. The notice also asks Mr. Ganesh Shetty to reply with in 15 days and restore the building to the original approved plan, failure to which the demolition order will be issued.

7. We understand that builder has applied for Akrama Sakram scheme on 13-12-2007 which includes the unauthorized office/flat at car parking and a pent house. As per our knowledge any car parking violation can not be rectified under Akrama Sakrama scheme and at the same time application can be made only to the structure which is already complete but not according the approved plan.

There are 8 types of problems faced by the flat owners at Apeksha Residency. They are listed herewith.

• A) NON RECEIPT OF IMPORTANT DOCUMENTS like DOD, Completion certificate, Door no, etc (Topmost priority for this and there can be no compromise on this). The builder is bound to provide these documents to the flat owners. Please refer Supreme court Judgment civil Appeal no. 3302 of 2005. DKD CDR Judgment askes the builder to obtain all these documents to provide to all flat owners.

• B) UNAUTHORIZED CONSTRUCTION

  • i) Unauthorized construction of 10th floor PENT HOUSE is already done with out partition walls and ceiling. This was done before we occupied our flat. This has happened because of poor supervision of MCC officials.
  • ii) Unauthorized construction of 2000sqft office/ flat at car-park started in January 2008 - after we occupied our flats. We were able to stop the construction DKD CDR Judgment clearly says that ground floor & basement is only for car park.
  • iii) There are small minor deviation like larger duct and area loss is compensated in the balcony and Ceiling of car park extended to enlarge car park. These may not be serious violation! Builder has to convince the MCC.

  C) STARTING OF ASSOCIATION

  It is the obligation of the builder. He has to initiate this by providing all the documents listed below;

  • 1.Deed of Declaration to all flat owners,
  • 2.Copies of building Completion Certificate and Occupancy Certificate issued by the Mangalore City Corporation (MCC),
  • 3.Door number document of every flat,
  • 4.Electric bill in individual name,
  • 5.Water meter transfer,
  • 6.Car Parking allotment letter,
  • 7.Revenue abstract,
  • 8.Any other related documents like License for Lift Operation,
  • 9.Audit report of MESCOM,
  • 10.License to operate the lift,
  • 11.Lift AMC/guarantee documents,
  • 12.Generator AMC / guarantee documents,.
  • 13.Clearance certificate from Fire dept.
  • 14.Clearance from Pollution Control Board,
  • 15.Quality report from independent engineer.

  We drew his attention to the Karnataka Ownership flat act 1972 clause 6, which fixes responsibility on builder/ promoter for payment of outgoings (including electricity and maintenance) till the property is transferred to the flat owners association. Therefore, he must expedite formation of flat owners association. When he asked us to pay monthly maintenance charges fixed in ad-hoc manner with out consulting us, we refused to pay individual electricity charges and monthly maintenance charges to builders till he fulfilled our requirement. We will pay all legitimate dues of our individual consumption of electricity after satisfactory completion of our demands which includes electricity bill in the name of flat owners..

• D) DEFICIENCY IN THE CONSTRUCTION

  .
  • i) Painting is not completed on following:
    
    • on internal walls near lift
    • windows and balcony rails
    • Second coat for external walls of the building.
    • Closing of ducts with door on the corridor of each floor.
  • ii) Pavement on the rear side of the building remains incomplete.
  • iii) Problems with PLUMBING ( No compromise on this)
  • There is a basic flaw in the water connection plumbing circuit. It is observed in flat 502 that when ever tap in the lower floor is opened, water flow in 502 is stopped. This is because inadequate water flows in the pipeline. Builder's expert has diagnosed the cause of this problem correctly. He says that one pipe line supplies (distributes) water to its three branches for three ducts. Therefore water flow in each pipe line (in each duct) reduces to 1/3rd and hence this problem. Pipe line to each duct should originate from the over head water tank. PLEASE NOTE When all the flats are occupied, this problem will become very severe for the upper floor residents.
    We find frequent leakages of water from one or two ducts at any time. These leakages are causing damage to the concrete structure by rusting of reinforcement steel. This should be arrested urgently.

• E) PROMISED BUT NOT DELIVERED

  Promised but not deliveredtherefore what ever possible should be completed and for other deficiency monetary compensation should be demanded. Put realistic value against each item for calculation of undelivered promises.

• F) EXTORTION

  Builder demanded further excess payment in addition to agreement amount under the pretext of various heads like Service tax, VAT, Price escalation, Recreation hall etc. He would not hand over the key with out the extortion amount. ( No compromise on this)
  It works out to Rs 1,58,310 for 3BHK flat and Rs 1,32,591 for 2BHK flat. Some have bargained and paid lower amount than what he has demanded. DKD CDR Forum asked the builder to refund the excess amount collected.

• G) DISTRIBUTION UNDIVIDED SHARE OF LAND

  Builder has retained illegally 3.4% of undivided share of land with him. This share can not accommodate him with pent house (say about 2000sq ft) on unauthorized 10th floor and about 2000 Sqft. of unauthorized office at the ground floor. This should be distributed to us legally.

• H) CAR PARK FRAUD

  Revised car park drawing -submitted under Akrama Sakrama -is not drawn to any scale and it does not show 2 pillars in ground floor and 2 pillars in basement. Car-parks shown are not practical as 15 feet gap between two pillars can not accommodate 2 cars between pillars when compound wall is at a distance of 11-13 feet from the pillars. No godown / storage of construction materials are allowed in car-park. Car-park can not be enclosed with walls and shutter. Shutter in one car-park at basement should be removed.
  The fact is that ground floor car-park can only accommodate 26 cars and basement car park can accommodate only 10 cars. This should be verified at the site. Hence there is only 36 car-park which just adequate at the rate of 1 car per flat. Their drawing is nothing but fraud on MCC. ( No compromise on this)

RECONCILIATION EFFORTS before complaining to DKD CDR Forum.

The following reconciliation efforts are made by us and this is mentioned in our Affidavit to DKD CDR Forum.

On 20th April 2008, we made very serious efforts for reconciliation with Mr. Ganesh Shetty. He refused to take our phone calls. When we informed that Mr.Jayaram Shetty -who is well known to him and also well wisher of both the parties-is with us. He informed us through Mr.Sampath, he will meet us 1.30pm in his office. He did not turn up and again sent word that he would meet us at Apeksha at 8.30pm. Again he did not turn up and informed us through Mr. Sampath that he would meet Mr. Jayaram Shetty at his residence at Belthaangadi next day morning. Even than he did not turn up for the discussion with Mr Jayaram Shetty.

On 28th May 2008, we met Corporator Mr. NavinChandra. Mr.Sampath was called to meet him. Mr. Navin enquired about our Completion certificate, & DoD. As usual no commitment were given by Mr.Sampath.

There after, we made few attempts for reconciliation through Mt. Narayan Pai who is personal friend of Mr. Ganesh Shetty. He also did not succeed in arranging meeting with the builder Mr. Ganesh Shetty. After these attempts failed we approached the advocates for legal action.

DKD CDR Forum on 6-9-2009 before pronouncing the judgment asked both parties to come to a compromise before 12-10-2009. Builder's lawyer remained absent.

PRESENT STATUS

At present builder has appointed one labour family-staying in a room in basement and one worker from security agency is seen from 7pm to 7 am to switch on and switch off generator, to look after safety of his material and to attend to those looking for rental flat i.e builder's business. One sweeper during day time does not keep premises clean and neat because of no supervision.

HAND OVER TIME

Builder should initiate the flat owner's association immediately and hand over the management of the building, maintenance and day to day affairs. He should hand over all original documents pertaining to the property,

• 1.Property ownership documents,
• 2.MCC Documents,
• 3.Generator Manuals and its documents,
• 4.Electrical panel Manuals and its documents,
• 5.LIFT Manuals and its documents ,
• 6.MESCOM documents,
• 7.Water / sewage departments documents,
• 8.Any other relevant documents.

Builder must provide copies of all the correspondence and disclose all relevant information to the association

Why we refused to pay monthly maintenance and electric bill?

During the month of February 2008, builder asked us to pay electricity charges and maintenance charges (with out proper basis) for last six months. We have to pay electricity charges based on domestic tariff and actual consumption once the DOD is prepared and registered and all other documents are handed over to us. We would like to draw your attention to the Karnataka Ownership flat act 1972 clause 6, which fixes responsibility on builder/ promoter for payment of outgoings (including electricity and maintenance) till the property is transferred to the flat owners association. As per this act we are not liable to pay electricity and maintenance charges and other outgoings till builder starts the flat owners association. Builder can not decide maintenance charges on adhoc basis with out consulting all the flat owners. This has to be decided by the association collectively. Therefore, Builder must expedite formation of flat owners association. We have clarified this through our letters dated 3-2-2008, we have clearly said that until the building is complete and all the documents are handed over to the owners, we will not be contributing to any expenses whatsoever towards the maintenance. However, we agree to pay arrears (with out interest & penalty) of electricity bill pertaining to individuals after the formation of flat owners association. Builder has employed his staff to look after his materials stocked in ground floor and basement.

ABOUT THE BUILDER

However, we feel the conduct of the builder in present case deserves to be noticed. Builder Mr.Ganesh Shetty is a Diploma holder in Civil Engineering (from Karnataka Polytechnics-Mangalore). He started his contracting business (Apoorva Associates) in 1985. He is aware of the MCC rules and obtained license (224:2004-05 dated 30-11-2004) and approved drawing for 36 flats. The builder attempted to put up additional Pent house (37th flat) on the terrace and Office/ flat (38th) at the car park thereby depriving 7 car-park spaces for flat owners. He retained 3.34% of undivided share of Land (registered on 5-12-2005) with him self illegally. He intended to build more than the number of flats mentioned in the license right from the beginning of the project. Probably, the builder is under the impression that he would be able to either escape the clutches of the law or twist the arm of the law by some manipulation. This impression must be proved wrong.

JUDGMENMT- Analysis

The summary of our 46 page case judgment should not ignores the root cause of the problem i.e. non-adherence of MCC's approved plan and License while constructing the building. For this reason the builder is not able to get door no, completion certificate etc and the builder has not provided the document called registered Deed of Declaration. Therefore, he has not submitted the building to Karnataka Apartment Ownership Act, 1972.

Builder should construct the building with out any deviation from the MCC approved plan and license and if any changes in the plan are required, then the approval for that should be obtained first and then proceed with the construction. The builder carried out the deviations first and then tries to get approval. This is not permitted in the law. We, the buyers of the flat, has never asked the builder to deviate from the approved plan.

It is also proved that the Builder has also indulged in unfair trade practice. We were able to prove our points by providing documentary and photographic evidences in the court.

We analyzed the DK-DCD-R FORUM's order dated 15-10-2009. Builder has flouted most of the laws of the MCC intentionally. Issues discussed there could be classified as following;

• a)Proven issues in the FORA beyond doubt.-Not adhering MCC approved plan & license and other documents, Obligation of builder, Collection of excess amount, Unfair Trade Practice,
• 
  
• b)Laws flouted by the builder which is proven in the DK-DCD-R FORUM.-Failure to get MCC certificates, Car-park not as per approved plan, Additional structure built with out approval, unfinished Painting & Post boxes, Sakrama application with out the consent of flat owners.
• 
  
• c)Unfulfilled statutory requirements by the builder. - Marketable Title not provided, Revenue entry not done, Formation of association not done, Guarantee documents not provided, Reasons for builders failures, Compensation & compliance not done.
• 
  
• d)Where Judgment is silent - Justice needed here. - 3.34% USL (37th) retained illegally against 36 approved flats in the License, Service Tax & VAT not applicable in our case, Refund with Interest, Interest for delayed period.

Other high lights of the judgment are;

• Handover the possession of common areas (by dismantling unauthorized construction on 10th floor and ground floor) to the flat owners and obtain completion certificate, door-no. etc. from MCC.
• 
  
• Withraw Sakrama application. Ground floor & basement should be used for car-park only.
• 
  
• Provide Deed of Declaration with proper car park documents and form the association.
• 
  
• Complete the unfinished work like painting, plumbing etc.
• 
  
• Refund the excess amount collected,
• 
  
• Pay compensation of Rs 50,000=00 each to all 14 flat owners and Rs 1lakh to one flat owner who was not given key to his flat.
• 
  
• Pay litigation charge Rs 10,000=00.
• 
  
• Compliance / payment to be made with in 30 days.
• 
  

After the judgment at DK-DCD-R Forum Mangalore, builder started dismantling the unfinished GF office with one or two labourers. Other works mentioned in the judgment was not even started / done till date . For DOD, he has not produced all the necessary documents to the lawyer. We were keeping a watch on the website http://kscdrc.kar.nic.in/ . Our builder has appealed in the higher court at KSCDR Commission Bangalore against the judgment we got this news on 16-11-2009.

At KS CDR Commision gave its judgment on 23 September 2010. Builder's appeal is dismissed.

This DKDCDRF judgment has been confirmed by the KS-CDRCommission at Bangalore as "JUST and PROPER"

Builder's appeal at National Consumer Disputes Redressal Commission has been dismissed at the admission stage and confirmed that "the compensation granted is proper and flat owners have been harassed for over number of years." Hence builder should accept the judgment gracefully or he must face the consequences for not adhering to the judgment. Builder never approached us for any concession before this date.

Arrest warrant was issued by DKDCDRF. Builder surrenders on the last day at DKDCDRF. Builder promises to work out compromises. He never contacted us with clean proposal. He was trying to push for us to agree to include PENT HOUSE and 4 extra car parks in the DoD. We are not ready to accept any illegal thing in our building for the DoD. Personal data of the flat buyers in the draft submitted by builders lawyer was not accurate. Compiling the flat owners details accurately is the responsibility of the Builder. Hence there was no progress on drafting of DoD.

Builder started external painting, completed half of the work and stopped without painting on the eastern and southern side of the building. During the ADALAT session on 23-02-2011, Hon. Judge asked the builder to complete the work as stated in the DKDCDRF judgment. Builder wanted two more months to complete the work. Hon. Judge asked to report progress after one month 23-03-2011. See the ADALAT report of 23-02-2011.

We met builder's advocate on 8th and 9th March 2011. This was the turnig point. Builder agreed for 36 car park for 36 flats also agreed not to include pent house in terrace. On 14th March 2011 the Deed of Declaration is signed by 38 flat owners for 52 grantors at Registrar's office in Mangalore. See photos of flat owners on the occassion out side registrar's office.

On 23rd March 2011, at DKDCDR Forum, Builder gave memo indicating that DOD is signed, Car park slots are marked, Interlock flooring at car park done, External Painting is 75% complete, Door number is given, etc and asked for two more months to complete. Forum will hear next on 23rd May 2011. If all pending work is not completed by then, day to day hearing of progress will be held till the conclusion of the case.