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Why SEBI should extend Dec 5th timeline on demat of physical shares?

Why SEBI should extend Dec 5th timeline on demat of physical shares?

30, Nov 2018

December 5th, 2018 deadline to covert physical shares into demat is just giving sleepless nights to lakhs of investors in the country.

On 8th June 2018, SEBI has notified vide Notification No. SEBI/LAD-NRO/GN/2018/24  by issuing SEBI (LISTING OBLIGATIONS AND DISCLOSURE REQUIREMENTS) (FOURTH AMENDMENT) REGULATIONS, 2018 that except in case of transmission or transposition of securities, requests for effecting transfer of securities shall not be processed unless the securities are held in the dematerialized form with a depository. In other words, there will not be any transfer of physical share after 5th December 2018.

 

According to this amendment, the requests for effecting the transfer of listed securities shall not be processed after 5th December 2018 unless the securities are held in the dematerialized form with a depository. Therefore, for effecting any transfer, the securities shall mandatorily require to be in demat form.

 

Then came November 6th , 2018 circular of SEBI

 

A welcome move by SEBI came when the country was in the festive mode of Diwali. A perfect Diwali bonanza for Investor who is finding it difficult due to cumbersome and ambiguous process to transfer their Old physical shares

 

SEBI received lot of representations, highlighting difficulties faced by transferees in providing documents for effecting transfer of securities and the documents sought used to vary across RTAs (Registrar & Transfer Agent) for cases relating to transfer of old shares in physical form where PAN card of transferor not available, name mismatch, signature mismatch etc.

 

Vide circular SEBI/HO/MIRSD/DOS3/CIR/P/2018/139 dated 6th November 2018, SEBI laid down Standardized Norms for transfer of Securities in physical mode

 

SEBI 6th November-2018 circular gives reasons to Cheer but haunted by 5th December 2018 deadline: Reason for extending December 5th deadline

 

A welcome move by SEBI vide 6th November 2018 circular to standardized the norms to transfer old physical share certificates to the rightful owner would not serve any purpose if December 5th deadline by SEBI is not being extended.

 

After SEBI’s 6th November circular, all listed companies, RTA and even SEBI themselves were caught up with continuous query flow from end number of an investor seeking clarification about the circular.  On the other side if SEBI remain adhered to December 5th deadline then it would just defeat the purpose of having November 6th circular which is considered to be most investor-friendly circular as it would be simplifying the process of ownership transfer of physical shares where the transferor is not traceable or having PAN or signature mismatch issues.

 

There was a recent article in the national leading newspaper The economic times with a caption Physical shares turn 'illiquid' after 5 Dec; 4% of Sensex scrips still in non-demat form. This is just tip of the iceberg. There are more than 5000 listed companies in India where crores of rupees of physical shares are just lying.

 

Can holder continue to hold shares in Physical form? 

 

Yes, the holder can continue to hold the shares in physical form but one cannot transfer the same in physical form.

 

Hoping to have much sought after extension from SEBI thereby extending December 5th deadline.

Author,

Vikash Jain

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Pending Old Share Transfer Cases?  Big relief by SEBI for transfer of securities in physical mode.

Pending Old Share Transfer Cases? Big relief by SEBI for transfer of securities in physical mode.

22, Nov 2018

A perfect Diwali bonanza for Investor who is finding it difficult due to cumbersome and ambiguous process to transfer their Old physical shares

If you are facing the followings issues in the process of Transfer of physical shares then there is sigh of relief to lakhs of investors by Securities Exchange Board of India (SEBI)

  • Not having PAN card of the Transferor of Share?
  • Issues relating to Mismatch of name in PAN card vis-à-vis name on share certificate/ transfer deed?
  • Major mismatch / Non-availability of transferor’s signature?

What was the Issue?

SEBI received lot of representations, highlighting difficulties faced by transferees in providing documents for effecting transfer of securities and the documents sought vary across RTAs (Registrar & Transfer Agent) for cases relating to transfer of old shares in physical form where PAN card of transferor not available, name mismatch, signature mismatch etc.

Welcome gesture by SEBI : Setting up of Standardized Norms for transfer of Securities in physical mode

SEBI vide its circular dated 6th November have tried clarify various issues / difficulties being faced by investor to effect transfer of their securities in physical mode. This circular is issued under Regulation 101 and 102 of LODR to address the difficulties faced by investors in transfer of physical shares.

Let’sglance throughthese standardized norms for transfer of Securities in physical mode

1. Non-availability of PAN of the transferor for transfer deeds:

  • Transfer deeds executed prior to December 01, 2015: It has been clarified by SEBI that transfer deeds executed prior to notification of LODR (i.e., December 01, 2015) may be registered with or without the PAN of the transferor as per the requirement of quoting PAN under the applicable Income TaxRules.

In other words, any transfer deed executed after December 01, 2015 need to have PAN number of the transferor for effective transfer

2. Mismatch of name in PAN card vis-à-vis name on share certificate/ transfer deed:

Investors have been facing issues relating to mismatch in name due to marriage, name change etc.  In such cases, transfer shall be registered on submission of any of the four following additional documents explaining the difference innames:

  • Copy of AadharCard
  • Copy of legally recognized Marriage Certificate
  • Copy of gazette notification regarding change in name
  • Copy ofPassport

3. Major mismatch / Non-availability of transferor’s signature:

There are multiple cases where the transferor did not take efforts to update his signature since he had already received the consideration for the transfer. Further, in many cases, the transferors could not be tracednow.

To address this major issue where the buyer felt stranded, SEBI laid down the following procedure / documentation for registration of transfer of securities, in such cases:

I. RTA/ company shall follow the procedure as laid down in Para (B)(2) of Schedule VII of LODR for major difference or non- availability of signature of the transferor(s).  The brief procedure in such case is:                                                                                                            the transferor is required to update his/ her signature by submitting bank                                                                        attested signature along with an affidavit, cancelled cheque to the                                                                                  RTA/company and contact details of the transferor

II. Issuers / RTAs shall make efforts to contact the transferor by tracking dividend history / by contacting bank, KRAs anddepositories. Issues / RTA shall try contacting the transferor by

  1. checking the Dividend history and obtaining the current contact details from the bank where dividend was encashed.
  2. from the address, email ids and phone numbers, if any, available with theDepositories/KRA

III. Many a times the transferor does not co-operates the buyer. In case of non- delivery of the objection memo                 to the transferor or non-cooperation by / inability of the transferor to provide the required details to the                         transferee, company / RTA shall register the transfer after following the procedure asunder:

1. Following additional documents shall be collected from thetransferee:

  • Copy of address proof - Passport / Aadhar Card / Driving License of thetransferee.
  • An indemnity bond from the transferee in the format prescribed by SEBI
  • An undertaking that the transferee will not transfer/ demat the physical securities until thelock-inPeriod.  These securities shall be under lock-in for a period of 6 months from the date of registration of transfer. The securities so transferred shall bear a stamp affixed by the company / RTA stating that these securities shall be under lock-in.  RTA may also verify the documents submitted by the transferee with the KYC details, if any, available with the Depositories/KRAs.

2. Companies / RTAs shall publish an advertisement in at least one English language national daily newspaper having nationwide circulation and in one regional language daily newspaper published in the place of registered office of the listed entity is situated, giving notice of the proposed transfer and seeking objection, if any, to the same within a period of 30 days from the date of advertisement. A copy of the advertisement shall also be published on the company’swebsite.

3. Transfer shall be effected only after the expiry of 30 days from the newspaper advertisement.

4. Names of the transferor, transferee and no. of securities transferred under this procedure shall be disclosed on the company’s website for a period of 6 months from the date of transfer. This information shall also be displayed on stock exchange website as a corporate announcement;

Even in case of non-availability of any document required for transfer and the transferor is not cooperating or not traceable, companies/ RTA shall register the transfer by following the procedure as specified in case of major mismatch / non-availability of transferor’s signature.

LODR regulation also require that the transfer shall be registered only ifthe address of the transferor submitted in the bank attestation matches with the address recorded in the records of the company / RTA. However, many a times the address as available with the company, as per old records, may not match with the current address attested by the bank and this has resultedinrejectionoftransferrequestscausingunduehardshipto

investors. A welcome move by SEBI to make this hassle simple. In such case where the bank attested address of the transferor differs from the records available with the company / RTA, companies/ RTAs shall register the transfer by updating the new address as attested by the bank.

SEBI circular of 6th Nov is a light at the end of the tunnel but 5th  December timeline is haunting badly

Though the recent circular is soothing the wound of lakhs of investor by simplifying the norms to for transfer of securities in physical mode but December 5th deadline to covert physical shares into demat is potentially acting as threat to heal the wound. If there is no extension beyond 5th December then there will not be any relevancy of this circular as the investor will not be able to get their transfer of shares in less than 30 days’ time.

Let’s hope to get extension of 5th December timeline.

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Mis-selling, pendency of claims to blame for insurance disputes- Share Samadhan

Mis-selling, pendency of claims to blame for insurance disputes- Share Samadhan

05, Sep 2018

The Tribune 

Tribune News Service

Chandigarh, September 3

Insurance companies cajole customers to buy life, non-life and mediclaim policies, but they have hundreds of excuses to reject their claims. For instance, they reject the claim of engine breakdown if the policyholder restarts the vehicle in the monsoon deluge.

Mediclaim policyholders also face similar situations. Recently, a Chandigarh-based patient, who was admitted to the emergency ward of a private hospital for some gastro-intestinal disorder, was denied cashless facility only because he told the doctor that he takes alcohol once in a blue moon. The third-party administrator quickly showed him the “policy exclusion clause 4.8” and denied the cashless facility.

There are ways to get away with such knotty conditions, which customers often ignore while buying a policy. According to Amit Singh, executive director, Palm Insurance Brokerage, "In such case, the policy holders should buy a comprehensive policy with ‘engine protection’ cover, to avoid inconvenience at the later stage". Many insurance experts agreed that agents often conceal such practical issues while selling policies.

For the instance case of mediclaim rejection, doctors advise that patients should not disclose alcohol drinking even if it is occasional to avoid the draconian clause. The Insurance Ombudsman office agreed that there is a rise in claim-related grievances.

"There has been constant increase in number of complaints filed at Consumer Disputes Redressal Forums and insurance ombudsman. The need to the hour is to bring transparency in the system. At the time of selling policy, terms and conditions are not made clear to the consumers, the consumer comes to know only at the time of settlement," said Share Samadhan co-founder Abhay Chandalia.

According to a report issued by the office of ombudsman, Chandigarh, the authority received a total 2,122 complaints in 2017-18. 

A senior official at the ombudsman office said, instances of mis-selling of insurance products through bank branches are also on the rise. Customers easily give in to the aggressive marketing techniques of some bank employees primarily on account of the trust reposed in the bank. Mis-selling refers to certain ‘unfair business practices’, including wrong sale of product, loading on products and promise of higher returns whereas in non-life, health insurance and motor vehicle cases constituted major portion of complaints.

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How to find and get your dues back: Unclaimed Shares, Insurance, Deposits

How to find and get your dues back: Unclaimed Shares, Insurance, Deposits

29, Aug 2018

As the flood-hit residents of Kerala look to rebuild their lives, they will need documentary proof to establish ownership of properties and financial investments. 

Thankfully, the Insurance Regulatory and Development Authority of India (IRDAI)asked insurers to streamline claim settlement processes, as it had for other flood-affected regions earlier, and they have relaxed documentary requirements for claimants. 

This is a crucial step taken by insurance companies since it will ensure that people receive their dues at the earliest. 

However, there are various reasons why investors fail to claim their dues running into lakhs from various. financial institutions like banks, insurers, post offices and mutual fund houses, among others. 

These range from failure to produce required documents due to their loss in a natural disaster or other reasons, and lack of awareness about their holdings (often inherited sums), to financial institutions’ failure to track beneficiaries due to change of address. This is why these organizations are sitting on a huge pile of unclaimed funds. 

“Investors do not keep their family members informed about investments. People change their addresses but often forget to update it with financial institutions. Shares or bond certificates may be lost or misplaced. The legal heirs often find it difficult to stake claim due to legal hurdles,” says Vikash Jain, Cofounder, Share Samadhan. This organization is helping the Kerala flood victims trace their financial documents for free. 

Life insurance companies have Rs 15,166 crore lying unclaimed. Banks have Rs 11,302 crore worth of unclaimed deposits. The Employees’ Provident Fund Organisation (EPFO) has Rs 1,094 crore in its inoperative accounts. The unclaimed money in post office savings’ schemes amounts to more than Rs 981 crore, while unclaimed company deposits, dividends, etc., credited to the Investor Education and Protection Fund were more than Rs 1,673 crore as of July 2017. According to industry estimates, the unclaimed redemption and dividend proceeds across mutual funds is well over Rs 800 crore. 


Despite efforts by the regulators–RBI, IRDAI and SEBI introduction of technology-enabled services to make the process simpler, the unclaimed amounts continue to be alarmingly high. Here’s how you can get your unclaimed dues. 

Funds to the tune of Rs 31,000 crore haven’t been claimed 
Tracking your forgotten investments and getting back your money is not particularly difficult.

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*As on 31 March 2018; **As of December 2017; #Credited to investor protection fund; ##Industry estimate; ^2014-15, does not include PPF; ^^As on 31 March 2017 Source: Parliament replies, RBI, IRDAI public disclosures by companies

Stocks and corporate deposits
Access to unclaimed shares is significant at this juncture, given that the deadline, 5 December, for converting physical shares into demat form is fast approaching. After the deadline, shares held in physical form will not be allowed to be transferred. 

According to Share Samadhan, the market value of physical shares of 2,768 actively traded BSE-listed companies is a whopping Rs 5.35 lakh crore. It is time to dig out long-forgotten investments and ensure that they do not become worthless. Jain narrates a case where a client found out that her deceased mother owned shares of multiple companies that were intended to be bequeathed to her. “However, her mother had forgotten to nominate her in any of the companies. Since the value of shares ran into crores, it was mandatory for her to obtain a succession certificate from the district court,” he says. It took her around 10 months to obtain the certificate. After the formalities were completed, she got shares worth Rs 1.5 crore. “If an investor dies without making a will, or appointing a nominee, the heirs will have to approach the concerned financial entity. 

They will have to provide the deceased’s death certificate or may have to provide a succession certificate to stake their claim,” says Jain. If the value of the physical shares is less than Rs 2 lakh (Rs 5 lakh in case of demat shares), the heirs will need to get the ‘legal heir’ certificate from the divisional magistrate or sub-divisional magistrate. If it is more than Rs 2 lakh (more than Rs 5 lakh in case of demat shares), heirs need to get a succession certificate from the court. If share certificates or company deposit proofs have been lost, the investor will have to approach the company and furnish the required KYC documents to establish their credentials. 

Life insurance proceeds
IRDAI requires all insurers to facilitate policyholders or their nominees to track unclaimed amounts on their websites. “At times, policyholders forget to claim survival benefits or we lose contact with them or their nominees due to change of address and bank accounts. Many change their mobile numbers, too, making it difficult to find them,” says Ashwin B., COO, Exide Life Insurance. 

Insurers top unclaimed funds list 
You can use the search facility on these insurers’ websites to find out if you have any unclaimed insurance proceeds 
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As on 31 March 2018 

If you suspect that you have a claim, you can use the search facility on the insurer’s website, even if you do not have the policy number. For instance, Life Insurance Corporation of India’s (LIC) website requires just the policyholder’s name and date of birth. “If you find that you are eligible for claiming dues, you can approach us and the claim will be disbursed after verifying the needed documents,” says Ashwin. 

For claiming death benefits, the necessary documents include a death certificate, a copy of FIR in case of accidental death and documents certifying the nominee’s identity. With the amendment to the Insurance Act in 2015 introducing a new category of nominees, beneficial nominees, which includes parents, spouse, and children, it has become easier for dependants to get the insurance proceeds. 

“To claim the maturity amount, the policyholder is required to submit the surrender form along with a canceled cheque or bank passbook and PAN card copy,” says Mohit Rochlani, Director, IT and Operations, IndiaFirst Life Insurance. Money not claimed for more than 10 years as on 30 September will be transferred to the Senior Citizens’ Welfare Fund (SCWF). “Even after this period, beneficiaries can claim the amount from the insurers, who will, in turn, claim it back from the government,” says Ash.

Earlier, pension plan holders often failed to claim their own funds, if the accumulated amount was not sufficient to buy the minimum annuity. Insurers kept these funds as Unclaimed Amount’. Now, IRDAI has allowed the companies to hand over this amount as a lump sum to policyholders or their nominees. Don’t forget to claim it. 

Bank savings and deposits
“When people change jobs, employers insist on opening salary accounts with particular banks. People often do not operate their earlier accounts and it turns inoperative,” says V.N. Kulkarni, financial counselor and a former banker. Refunds from agencies like the Income-Tax Department or credit of refundable deposits by some service providers may languish in accounts no longer used. 

Banks owe customers a hefty sum 
Money not claimed for over 10 years is transferred by banks to the Depositor Education and Awareness Fund. You can still claim it. 
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Other than SBI. As on 31 December 2017

The RBI requires banks to transfer any sum that has not been claimed for more than 10 years to the Depositor Education and Awareness Fund (DEAF). Like insurers, banks too are required to provide a search facility to their customers for identifying unclaimed deposits. The SBI’s website displays a list of unclaimed deposits and inoperative accounts older than 10 years if you enter the first name of the account holder. Other banks too allow similar facilities to track down a specific account. Once you locate the account, reach out to your bank to stake a claim. Even if the sum has been moved to the DEAF, you can claim it from the bank. 

Inoperative PF accounts
The Employees’ Provident Fund (EPF) scheme has seen a series of changes in recent years, most notably the introduction of UAN (Universal Account Number), making reclaiming any accumulated balance easier. The EPFO also offers an online Inoperative Account Help Desk to guide its subscribers. An account becomes inoperative if the claim has been settled but money has not been remitted due to lack of latest address, or the subscriber has retired from service, migrated abroad permanently, or has passed away, but the EPFO has not received a withdrawal application for 36 months, or if the amount remitted remains undelivered and has not been claimed within 36 months. 

You can proactively transfer the PF balance to prevent your account from becoming inoperative. “It is advisable to transfer the PF balance to your current PF account if you are still employed,” says Amit Gopal, Principal, India Life Capital. You need to log into the EPFO portal using your UAN (mentioned on your salary slip) and update your KYC details. “Get this approved by the current employer. Once this is done, one can initiate the transfer,” says Gopal. You can also withdraw the sum, if eligible. You will have to log in to the portal using the UAN and apply for a settlement. “You will have to get the KYC done and provide bank details through your previous employer and then apply online for withdrawal of EPF and EPS directly through employee UAN portal,” says Jain. “It is mandatory to apply for settlement of claims online if the provident fund balance is more than Rs 10 lakh,” says Gopal. 

The key to making transfers and keeping your account active is to know your PF number. “Even if your previous balance pertains to the pre-UAN period, a transfer can be done using the PF number of the previous company,” says Gopal. To withdraw the amount, get in touch with your previous employer, who will initiate the process through the EPFO office where the contributions were made. “If the PF account is too old, you will have to approach the employer for the PF account details to claim EPF and EPS offline,” says Jain. Claiming EPF proceeds is usually not a complex affair for the nominees. “Usually, the spouse or children are the nominees. The scope of the dispute is minimal as the employers are in the know,” says Jain. 

Mutual funds redemptions
All fund houses and the Association of Mutual Funds in India offer an online facility to investors to track unclaimed redemption proceeds or dividends. It usually happens when an investor fails to encash the dividend or redemption cheques or does not update account details. To find out if you have any unclaimed funds online, furnish any two of the following details: PAN, folio number, date of birth, e-mail ID and bank account information. 

Download a form for the release of the unclaimed amount and follow the fund house’s instructions. Till a claimant steps forward, mutual funds are allowed to park the unclaimed money in market instruments, liquid and money market schemes specifically introduced for this purpose. Fund houses cannot levy any exit load on funds parked in these schemes and the total expense ratio (TER) cannot exceed 50 basis points. If you claim the amount within three years of the due date, you will get the amount along with the returns that it earns during the period. If you claim the amount after three years from the due date, you will get the amount along with the returns over a three-year period, not for the entire period for which the funds have been lying unclaimed. Returns earned on such funds beyond three years are used for investor education. 

Post office savings schemes
According to Minister of Communication Manoj Sinha’s reply in the Parliament, unclaimed amounts in post office savings schemes was close to Rs 981 crore as of 2014-15. 

Lost track of post office investment? 
If you have just learnt about your unclaimed investment in a post office scheme, get in touch with the post office with your KYC details. 
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As on 31 March 2015 Source: Central ministers’ replies to questions in the Lok Sabha 

This does not include the figures for Public Provident Fund (PPF) as they are not public. Most salaried employees invest in post office schemes due to assured returns but lose track in the process of transferring the accounts from one post office to another. “For settlement, it is advisable that the person approach the post office where the investment was made and produce KYC documents to claim the amount. Legal heirs will have to follow the standard legal process,” says Jain. 

LIKE THESE PEOPLE, YOU TOO CAN GET BACK YOUR MONEY 
The process of identifying and reclaiming investments that have gone off the radar due to lost documents or lack of knowledge may appear cumbersome, but the rewards will be worth the effort, as these case studies show.

Problem: Loss of share certificate and name mismatch 
Bhakti Iyer had purchased some shares of ITC in 1995. She lost track of them when she switched jobs and moved to another city after marriage. Years later, when she recollected the investment, she realized that she did not possess the share certificates. Moreover, her surname had changed. 

Resolution 
The company was contacted and, after submitting the relevant identity documents, marriage certificate and completing several other formalities, her shares, as well as unclaimed dividends, were recovered. A few thousand rupees of investment had grown into a sizeable amount of Rs 25 lakh. 

Problem: Nominee unaware about investments 
Kavita Sharma’s husband never shared details of the shares he had purchased in the 1990s. After he died, she recalled that he had made investments, but had no access to documentary proof. However, the 75-year-old did remember the names of some companies he had invested in. 

Resolution 
Inquiries were made with the companies and folio numbers and shareholding information retrieved. Other equity investments too came to light. After satisfying the companies about the legitimacy of her claim—producing succession certificate and husband’s death certificate—investments worth Rs 17 lakh were recovered. 

Problem: Address change, signature mismatch 
Jignesh Devdhar, 60, had bought shares of around 20 companies when he was working. Due to the transferable nature of his job, he had changed his address several times and had failed to keep the companies informed. While he possessed original share certificates, he had missed out on bonus, split certificates and dividend warrants. 

Resolution 
A host of formalities had to be taken care of, including filing an FIR and placing advertisements in newspapers. Also, his hands weren’t steady due to his age, resulting in a signature mismatch. This meant getting his signatures verified by the bank, after which the amount was recovered. 

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Refund and Compensation under RERA

Refund and Compensation under RERA

24, Jul 2018

As we all are aware that Real Estate (Regulation and Development) Act, 2016 has been implemented to address the grievances of aggrieved home buyers, but many of the buyers are unaware of the rights and duties provided under the Act. In this article we will be discussing about the same.

One of the most important right which is vested the home buyers is that they are entitles for the Refund and Compensation Section 18 of the Act deals with the same.

The section s specifies “18 (1) If the promoter fails to complete or is unable to give possession of an apartment”

The Act by the way of section 18 clarifies that the home buyers are entitles to seek refund along with interest and compensation in case the builder fails to complete the project or is unable to handover the possession of the unit.

Further the Act under clause a) of section 18 “18 (1) (a) in accordance with the terms of the agreement for sale, as the case may be, duly completed by the date specified therein;”

With the help of this section the home buyers can claim their refund along with compensation in the event of non-completion of project or if the builder fails to handover the possession on the time as mentioned in the agreement signed between buyer and builders.

Further the act under clause 18 (1) (b) “18 (1) (a) due to discontinuance of his business as a developer on account of suspension or revocation of the registration under this Act or for any other reason,”

This means the home buyers have a right to claim his money back if the registration of the builder is cancelled due to any reason i.e. cancellation of registration of the project gives a right to the home buyer to claim his money back along with the interest.

Builder is liable to refund the amount of home buyer along with the interest and compensation as provided under the act without any prejudice to any other remedies available to the home buyers.

Provided that in case the home buyer does not intend to withdraw from the project the builder shall pay the interest for every month of delay till the handing over the possession at the rate prescribed under the Act.

Section 18 (2) specifies, “The promoter shall compensate the allottees in case of any loss caused to him due to defective title of land, on which the project is being developed or has been developed, in the manner as provided under his Act, and the claim for compensation under sub-section shall not be barred by the limitation provided under any law for the time being in force.”

In simplified sense if the builder is developing the project on the land on which he is not having a proper title and due to which the home buyer have suffered a loss of time/money or any other thing then the builder is liable to compensate the same.

Section 18(3) specifies “if the promoter fails to discharge any other obligations imposed on him under this Act or the rule or regulations made thereunder or in accordance with the terms and conditions of the agreement for sale, he shall be liable to pay such compensation to the allottees, in the manner as provided under this Act”

In a simplified sense this means that if the builder fails to comply with any of duties and imposed by the Act or under the terms and conditions of the agreement for sale towards the buyer, then he shall be liable to compensate the buyers in the manner prescribed under this Act.

To conclude with this article, it is observed that the builder in case of any default id liable to pay compensation to the buyers as prescribed under the Real Estate (Regulation and Development) Act,2016. Homebuyers are having an upper hand but they are also bound to perform their duties as given under section 19 of this Act and in case the homebuyers do fail to comply with their duties toward the builder then they might loss a grip of their upper hand in claiming compensation for default of builders.

For any Assistance regarding RERA feel free to contact the Author.

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Insurance Claim Missing Money IEPF Claim Lost Share

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