How to Obtain Statutory Approval for a Real Estate Project
After the agricultural industry, the real estate sector in India has become the fastest expanding business. To add professionalism and format to this industry, various legislative compliances and permissions must be cleared and approved by the developer even before the project begins development. Even before the RERA Act 2016 was enacted, these statutory clearances were required and statutory approvals in construction but this recently enacted act has brought about a remarkable change by establishing guidelines, allocating funds and management, setting a time limit to complete the project, and bringing an extraordinary amount of transparency and arrangement in transactions.
This permissions and statutory clearances procedure may be quite daunting and inconvenient, as it necessitates multiple approvals such as ownership certificate, building layout approval, non-agriculture authorization, several NOCs, permission from the NHAI, approval from the power, water, and fire fighting departments, commencement certificate, and much more to begin construction, which can take 1-2 years to get. Even if there is a deferral of 2/3 days, it might create significant delay, dampening total project delivery. Any project started without these permissions would face penalties such as fines and possibly prosecution. Based on the project stage, these approvals may be divided into three groups.
The stage of feasibility
The step of approval
Stages of completion and post-completion
A complete method for obtaining permissions and punishments is outlined below:
What is the difference between a land title and a land clearance?
Because the developer obtains the property first and then begins building on the project, the first step of development is land title and land clearing. As a result, it is critical for the developer to obtain a valid title for the plot where he will begin his project. The plot's clear title guarantees that the land's current status is clear, marketable, and free of all encumbrances, that there is no mortgage, lien, or third party right generated on the property, and that the developer has full right to construct the project without any lawsuit on the same. It enables a potential buyer to identify the chain of assets, transfers through time, and checks for any disputes.
Clearance of Land
Once the title procedure is completed, the developer must begin the process of permissions and penalties on land clearing. Depending on the area or city, the land may be agricultural or non-agricultural. Due to agricultural land, it must be changed into non-agricultural property by obtaining consent from the relevant authorities, which may then be utilized for the development of the project, which will be built for residential or commercial purposes.
What exactly is Zonal Clearance?
Once the land title and land clearing procedures are completed, the developer must get zone permission from the relevant authorities. Following the clearance of the zonal level, the department of revenue will award the developer with 7/12 or the ownership certificate for the project site. Once this step is completed, the Town Planning Authority enters the picture. The authority will review the development plan in accordance with the zone city, then this plan will be confirmed by the planning board and given to the other involved authorities for additional NOC's and any other particular permissions if necessary even before awarding the zonal approval.
Approval and clearance of the building plan
All structures to be built by any party require prior consent from the local authority where the structures are to be built. This regulation is in place to guarantee that the structures and buildings erected are safe, in an appropriate location, and in habitable locations for working and living in line with the bylaws. A building plan is a set of drawings created by certified Architects and Engineers that provides minute details about the project that will be built. A building plan may need to be revised for a variety of reasons before it is submitted to the local authorities. i.e;
To follow the legislation and rules of the local/responsible authority.
To add or remove any information from the plan.
To rectify any incorrect information submitted to the appropriate authority.
There are numerous kinds. Consider the following while submitting your proposal:
Plan a sketch
Site Map
Location Strategy
Building Plan Approval will take about 6 months from the date of submission of the documents and blueprints necessary by the state/local/concerned authority's bye-laws.
A building plan must be authorized after a lengthy process.
Disapproval Indication
The Intimation of Disapproval (IOD) specifies the conditions that must be met at various stages of the Project's construction. IOD is issued under three circumstances:
(i) At or before the start of construction.
(ii) In the interim or during construction.
(iii) When the construction is completed.
Certificate of Completion
In layman's terms, a start certificate is a permission from the local development authority to begin building. IOD and CC are critical papers; without them, the developer cannot lay foundation stones or create borders or walls around the defined area.
From our perspective, the developer must obtain more than 70 permissions from the authorities, which can be a time-consuming and aggravating task. The government should concentrate on how to make the developer's work easier. The UP government's acceptance of the one window permission for statutory clearance should be appreciated and supported by other states as well. Because all of these clearances are frequently delayed, the builder is unable to complete the work on schedule, which further delays the transfer of possession to the potential purchasers. Being dissatisfied with the delayed possession, these purchasers prefer to file a lawsuit against the developer, which complicates their relationship and has a negative influence on the industry. Paying interest on the developer's loans to complete the project has a significant influence on the cost impact. As a result, I value our country's single-window approval system, which will reduce these complexities at a low financial cost while also the requirements for building plan approval, physical and emotional stress, and assisting developers in completing their projects on time.
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