We have been working with a lot of housing societies in the past couple of decades and see a familiar pattern around when it comes to getting the conveyance of their housing societies done. The first and foremost is everyone thinks that they need to apply for deemed conveyance—a prevalent misconception. We don’t blame them; they don’t understand the fundamental difference between regular conveyance and deemed conveyance. That’s why we decided to pin down what does exactly each process means and why societies should go for it.

Let’s 1st try to understand what these terms mean both in legal terms & in layman’s term and then address a few common questions.

Conveyance

A generic term for any written document which transfers (conveys) real estate property or real property interests from one party to another.

So by the above definition, it’s evident that if someone willingly transfers their legal right of the property to another party, they would need to create a document that transfers this right. Such a document is called Deed of conveyance.

The critical point here is – Willingly. Now in case of housing societies, the builder/promoters have to ideally create Deed of conveyance and hand it over to housing societies that too within 4 months after project completion. However, due to a lack of knowledge, many builders do not create such documents. There have been cases where builders have later on denied to create such documents and asked additional money to provide signatures on these documents. You will find all sorts of reasons for not creating the document. This results in issues for societies in the future. Therefore, the government has amended the Maharashtra Ownership Flats Act, 1963 (MOFA), to make sure if builders runway from such responsibilities the societies do not suffer. This amendment is called Deemed Conveyance. This amendment allows society owners to gain the legal rights of the land even if the builder is not willing to transfer the rights, in front of the designated competent authority.

Deemed Conveyance

The Promoter (Builder/ Developer) is legally required to convey the land and the building within 4 months of formation to the society or any legal body of the flat purchasers. However, it has been the experience that many promoters (Builders/Developers) have not conveyed the land and building to the legal bodies. Therefore, the government has amended the Maharashtra Ownership Flats Act, 1963 (MOFA), and provided for the deemed conveyance in favor of the legal bodies. Under the provision, deemed conveyance means after the expiry of 4 months of formation of the legal body, the land and building is deemed to have been conveyed to the legal body and to bring the same in the revenue record; Competent Authority has been designated who will hear the parties on the basis of applications received from the aggrieved party and transfers the title in favor of the legal body bypassing the necessary order and deemed conveyance certificate and appoint an authorized officer to execute the conveyance deed in favor of the society and execute on behalf of a non-co-operative builder or the landowner. Getting the title of land and building by adopting the above procedure is known as deemed conveyance.

Now, as we are aware of what conveyance and deemed conveyance mean, let’s see what some common issues or questions society owners have been.

Q: What is the difference between the deemed conveyance and the Regular Conveyance?

A: To make it short, any Deed of Conveyance executed with the consent of both the parties is called a regular conveyance. In case of deemed conveyance, either of the parties refuses to co-operate, the aggrieved parties can approach before designated authority and get the order of conveyance.

Q: Is there any further problem/litigation in getting the deemed conveyance, if the builder/ Landowner Does not co-operate?

A: Deemed conveyance is the final conveyance document that a society needs to possess. There will not be any problem. Once the Deemed conveyance is passed by the Competent Authority, the conveyance deed will be executed by the Authorized Officer in favor of the Legal Body. Further, the same will be registered. There is no appeal against the deemed conveyance order passed by the competent authority. Once the deemed conveyance order with conveyance deed is executed, the index II has to be obtained and submitted to the Talati office or City Survey office to incorporate the name of the legal body in the 7/12 extracts or in the property card as the case may be.

Q: What are the provisions for payment of stamp duty on deemed conveyance?

A: Like regular conveyance, even on deemed conveyance, the stamp duty will be only Rs.100/-, if all the flat owners have paid the stamp duty and have done the registration of their respective flats including on all the transactions (Chain of Agreements) done in those flats. In case some flat owners have not paid the stamp duty or have escaped the duty, the same will have to be paid at the time of registration of the deemed conveyance deed by the legal bodies, and the same can be recovered from such flat owners.

I am sure there will be a lot of questions you guys have on this whole process. We would be writing a whole series of blogs on this topic. Our next blog would cover the steps and documents required for conveyance/deemed conveyance. So stay tuned.

To know more about how we help housing societies and developers with conveyance, please visit our service – Execution of Coveyance and Deemed Conveyance.