Saturday, 27 December 2014

FAQ for purchasing property


Yes. The Act is in force.

The relevant provisions for non compliance of The Karnataka Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1972,  are  sections 12, 13, 14, & 15. which are dealt with here in below:

Sec. 12: General liabilities of a person who takes a flat - Any person  who has executed an agreement to take a flat and who without reasonable excuse failed to pay at the proper time and place the price, the Municipal Taxes, Water and Electricity charges Ground Rent, and other Public Charges, payable in respect of the Flat taken by him, shall on conviction be punished with fine which may extend to Rs. 1000/-.

Sec. 13:Manager not to cut off, withhold curtail or reduce essential supply or service-  Any person, who is a promoter, or who is in charge of management or connected with the management as a member of the Managing Committee, Director, Secretary, who contravenes the provisions of Section 13 or disobeyed the directions of the Court for restoration of amenities shall on conviction be punished with imprisonment for a term which may extend to 3 months or with fine or with both.

Sec. 14: Offences by promoter - Any promoter who without reasonable excuse fails to comply with or contravenes any provisions of the Act or any Rule made there under shall on conviction be punished with imprisonment for a term which may extend to one year or with fine which may extend to Rs. 2000/- or with both; and any promoter who commits criminal breach of trust of any amount advanced or deposited with him for the purposes mentioned in Section 5 shall on conviction be punished with imprisonment  for a term  which may extend to  4 years  or with fine or with both.

Sec.15: Offences by companies - If a person committing an offence under this Act, is a Company, every person who at the time the offence was committed was in charge of and was responsible to the Company for the conduct of business by the Company as well as the Company shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly except wherein such person proves that the offence was  committed without his knowledge or that he exercised all due diligence to prevent the commission of such offence.

In case  an offence under this Act has been committed  with the consent or connivance of, or  is attributable to any negligence on the part of any director, Manager, Secretary or other officer of the Company, such Director, Manager, Secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to proceeded against and punished accordingly.

Note : (1) Section 5 deals with the promoter to maintain separate account of sums taken as advance or  deposit and to be trustee thereof and disburse them for purposes for which given.

(2) The language used in this note under sec. 12,13, 14 and 15 are not the verbatim of the stature language.

In this regard the provisions of Section 32 of the Registration Act, 1908, are relevant which read thus:

Sec. 32: Persons to present documents if for registration Except in the cases mentioned in [Sec. 31, 88 & 89] every document to be registered under this Act, whether such registration be compulsory or optional, shall be presented at the proper registration office.

(a) by some person executing or claiming under the same or in the case of copy of a decree or order, claiming under the decree or order there under.; OR

(b) by the representative or assign of such person; OR

(c) By the Agent of such persons, representative or assign, duly authorised by power of attorney executed and authenticated in manner hereinafter mentioned.

On plain reading of the above provisions it is clear that a customer after executing an Agreement can authorize the company, by a simple letter to present the same for registration, before the Registrar, as per clause (b) of section 32 of the Act.

However, it would be advisable to obtain a registered general power of attorney executed by the purchaser in favour of the company to present the document for registration.

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