Karnataka flat owners in legal trouble over land rights

Absence of a conveyance deed executed to the owners’ association with mutation records not reflecting their encumbrance may put thousands of Karnataka flat owners in legal trouble over exercising their Undivided Share (UDS) of the land given to them in a sale deed.

The Real Estate Regulatory Authority (RERA) Act requires builders to transfer the undivided proportionate title to the buyer within three months of receiving the occupancy certificate.

However, there is confusion regarding the conveyance deed, which transfers the title of the land to the association of owners and allows the owners to request a change of ownership in the revenue records.

The Karnataka Home Buyers Forum, a collective of apartment owners’ associations, has written to the chief minister seeking urgent intervention to end the lack of clarity in the RERA, leading to denial of rightful land ownership.

Dhananjay Padmanachar of the forum stated that the association of owners, registered under the Karnataka Societies Registration Act 1960, does not give them the authority to exercise ownership of the project land.

"Going by Karnataka Ownership (Regulations of Construction, Sale, Management and Transfer) Flats Act 1972 (Section 10 and 11) and RERA Section 17, the society has to be registered under the Karnataka Cooperative Societies Act, 1959. However, builders have adopted an evasive tactic. They are inserting bylaws of the association in the Deed of Declaration which are registered by sub registrars," he said.

Many associations are registered under the Karnataka Societies Registration Act, which is meant for organisations engaged in charity, education, and other activities but not financial practices. As per the orders from Karnataka High Court, such societies are not empowered to exercise rights over property.

Anil Kalgi, a member of the Bengaluru City Flat Owners Welfare Association, said the registrar of cooperative societies has recently started registering apartment owners’ associations.

“Thousands of associations are yet to receive the execution of conveyance deed giving UDS the status of immovable property,” he said.

In the letter, the forum demanded the chief minister to issue a circular on the process of registering a conveyance deed. “It is for consideration that such deed can only take place to a legal entity that by its registration creates a body corporate,” it said, adding that deemed registration of the deed should be allowed if the builder or promoter fails to execute the same.

To a question, RERA chairman H C Kishore Chandra said the new projects were following the rules.

“We can’t comment about old projects. However, the buyers are getting the rights of the property in the new projects,” he said.

No encumbrance after a decade

Ameya P Usgaonkar, who bought an apartment in Rohan Mihira in 2011 and received khata for the same in 2015-16, was shocked to find that the revenue department’s documents do not show his name.

Last month, he wrote to the sub-registrar of Mahadevapura noting that the mutation records of the land in survey number 8/1, 8/2, 9/1, 10/2 of Chinnappanahalli village do not reflect his name.

“The building has 158 apartments, all of which have received their Undivided Share (UDS) as part of sale deed registrations. However, none of the apartment owners’ names appear in the encumbrance certificate of the land of Rohan Mihira.

“The encumbrance certificate still shows names of the landowners. When the owners of apartments do not have title ownership rights to a land, the said land can be remortgaged by erstwhile landowners and that too without any knowledge or intimation to any of the owners,” Usgaonkar told DH.