If you are buying or owning an apartment in Bengaluru, you may wonder which act is applicable for your property and what are the benefits and drawbacks of each act. In this article, we will compare the three main acts that govern the registration of apartments and housing societies in Bengaluru: the Karnataka Apartment Ownership Act, 1972 (KAOA), the Karnataka Ownership Flats (Regulation of Promotion of Construction, Sale, Management and Transfer) Act, 1972 (KOFA) and the Karnataka Societies Registration Act, 1960 (KSRA).
Karnataka Apartment Ownership Act, 1972 (KAOA)
The KAOA is an act that exclusively deals with residential apartments in Bengaluru. It aims to provide for ownership of individual apartments in a building and to make such apartments heritable and transferable property. The main features of this act are:
- The owner of each apartment gets a separate khata and a specific undivided interest in the land and common areas of the building.
- The owner of each apartment also becomes a member of the association of apartment owners, which is responsible for the management and maintenance of the building and its amenities.
- The declaration of the apartment ownership, which contains the details of the building, the apartments, the common areas, the percentage of undivided interest, the by-laws of the association etc., has to be registered under this act.
- The deed of apartment, which transfers the ownership of an apartment from one person to another, has to be registered under this act.
- The association of apartment owners has to maintain proper accounts, records and minutes of meetings and submit them to the competent authority when required.
- The association of apartment owners has to insure the building against fire and other hazards and pay the premium from the common funds.
- The association of apartment owners has to levy monthly charges on the apartment owners for the expenses incurred for the common benefit and enforce the payment of such charges.
- The association of apartment owners has to follow the by-laws and regulations made under this act and resolve any disputes among the apartment owners amicably or through arbitration.
The advantages of registering under this act are:
- The apartment owners get a clear title and ownership of their individual apartments as well as a share in the land and common areas.
- The apartment owners can sell, mortgage, lease or gift their apartments without any restrictions or interference from the builder or other owners.
- The apartment owners can enjoy the benefits of common facilities and amenities without any discrimination or favouritism.
- The apartment owners can form a democratic and transparent association that can manage and maintain the building efficiently and effectively.
The disadvantages of registering under this act are:
- The process of registration under this act is complex and time-consuming. It requires the consent and cooperation of all the apartment owners as well as the builder or landowner.
- The cost of registration under this act is high as it involves stamp duty, registration fee, legal fee etc. for each apartment as well as for the declaration.
- The association of apartment owners has to comply with various rules and regulations under this act and may face legal action or penalties for any violation or default.
Karnataka Ownership Flats (Regulation of Promotion of Construction, Sale, Management and Transfer) Act, 1972 (KOFA)
The KOFA is an act that regulates the promotion, construction, sale, management and transfer of flats in Bengaluru. It aims to protect the interests of flat purchasers from unscrupulous builders or developers. The main features of this act are:
- A flat is defined as an independent unit in a building for use as residence. It does not include an apartment as defined under KAOA.
- A developer or builder of flats has to register an agreement with the competent authority before accepting any advance or deposit from a flat purchaser. Such advance or deposit cannot exceed 20% of the agreed price.
- A developer or builder of flats has to transfer the ownership of flats to a registered association, co-operative society or company formed by flat purchasers within four months from obtaining occupancy certificate or within such period as agreed in writing.
- A developer or builder of flats has to provide all necessary information and documents related to flats such as title deeds, plans, specifications, approvals etc. to flat purchasers or their representatives.
- A developer or builder of flats has to complete the construction work as per schedule and quality standards agreed with flat purchasers. Any delay or defect has to be rectified within reasonable time or compensated adequately.
- A developer or builder of flats has to form an association, co-operative society or company of flat purchasers within four months from the date of first sale of flat or within such period as agreed in writing.
- A developer or builder of flats has to hand over the possession of flats to flat purchasers along with a completion certificate and other relevant documents.
- A developer or builder of flats has to convey the title and interest in the land and common areas to the association, co-operative society or company of flat purchasers within four months from the date of formation or within such period as agreed in writing.
The advantages of registering under this act are:
- The flat purchasers get a legal protection and recourse against any fraud, delay, defect or breach of contract by the developer or builder of flats.
- The flat purchasers get a fair and transparent deal with the developer or builder of flats regarding the price, quality, specifications, amenities, delivery etc. of flats.
- The flat purchasers get a collective ownership and control over the land and common areas through an association, co-operative society or company formed by them.
- The flat purchasers get a regular maintenance and management of the building and its facilities through an association, co-operative society or company formed by them.
The disadvantages of registering under this act are:
- The flat purchasers do not get a separate khata and a specific undivided interest in the land and common areas. They only get a share certificate or membership certificate from the association, co-operative society or company.
- The flat purchasers have to depend on the developer or builder of flats for the formation and conveyance of the association, co-operative society or company. Any delay or default by the developer or builder of flats may affect their rights and interests.
- The flat purchasers have to abide by the rules and regulations of the association, co-operative society or company. They may face restrictions or limitations on their rights to sell, mortgage, lease or gift their flats.
Karnataka Societies Registration Act, 1960 (KSRA)
The KSRA is an act that provides for the registration and regulation of societies in Bengaluru. It applies to any society formed for charitable, educational, religious, scientific, literary, cultural or other lawful purpose. The main features of this act are:
- A society is defined as an association of seven or more persons who agree to form themselves into a society under this act for any lawful purpose.
- A society has to register itself with the Registrar of Societies by submitting a memorandum of association and rules and regulations along with prescribed fee and documents.
- A society has to maintain proper accounts, records and minutes of meetings and submit them to the Registrar of Societies when required.
- A society has to conduct its affairs in accordance with its memorandum of association and rules and regulations and resolve any disputes among its members amicably or through arbitration.
The advantages of registering under this act are:
- The process of registration under this act is simple and easy. It does not require the consent or cooperation of the builder or landowner.
- The cost of registration under this act is low as it involves nominal fee and documents for each society as a whole.
- The society has a legal status and identity as a separate entity. It can sue and be sued in its own name.
- The society has a flexibility and autonomy in managing its affairs. It can make its own rules and regulations as per its objectives and needs.
The disadvantages of registering under this act are:
- The society does not have a clear title and ownership over its property. It only holds it on behalf of its members who are joint owners.
- The society does not have a specific undivided interest in the land and common areas. It only has a right to use them as per its memorandum of association and rules and regulations.
- The society may face legal challenges or disputes from third parties such as builder, landowner, government authorities etc. regarding its property rights and interests.
- The society may face internal conflicts or issues among its members regarding its management, finances, policies etc.
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