Regulatory Compliance for Redevelopment Projects in Maharashtra: A Complete Guide

Redevelopment Projects and Regulatory Compliance in Maharashtra

Redevelopment projects are the pillar on which urban development in Maharashtra, and more so in metros like Mumbai, Pune, and Nagpur, happens. With the compelling requirement to revive old infrastructure, a series of redevelopment schemes such as Slum Rehabilitation, Redevelopment of Housing Societies, Redevelopment of MHADA Housing Scheme, Redevelopment of Cluster, and Cessed Building Redevelopment come under the purview of the Greater Mumbai Development Control and Promotion Regulations (DCPR) 2034 and Unified Development Control and Promotion Regulations (UDCPR) of Maharashtra State.

Understanding Registration Specifications for the Sale Component

Mandatory Registration Under MahaRERA

Under Section 3 of the Real Estate (Regulation and Development) Act, 2016 (RERA), the Sale Component of all redevelopment projects in the state of Maharashtra shall be registered with the Maharashtra Real Estate Regulatory Authority (MahaRERA). This ensures that any part of the project being sold to third parties, separate from the rehabilitation component, is under government control. This is to ensure transparency and protect the interests of buyers.

Registration Scope

Sale Component: The share of redevelopment project being sold to new buyers, excluding original residents to be rehabilitated.
Rehabilitation Component: Alternative accommodations to current occupants are not required under RERA registration except if units are being promoted or sold to the public.

Sale Component Registration Document Submission Guidelines

For facilitating smooth registration, MahaRERA has particular documentation requirements from promoters for the Sale Component of redevelopment schemes. The documents needed are:

Resolution/No Objection Certificate (NoC) from Society/Association:

Get a formal order or NoC from the residents' association or society, sanctioning the legal right of the promoter to proceed with the redevelopment.

Letter of Intent (LoI)/NoC/Comparable Document from Planning Authority:

Provide a LoI, NoC, or an equivalent official letter from the municipal or planning authority, indicating that necessary permissions are in place.

Commencement Certificate for the Sale Component:

Provide a commencement certificate specific to the Sale Component from the concerned planning authority, authorizing commencement of construction in accordance with local authorities.

**Collaboration/Development Agreement (If Applicable):

If the promoter's name is not mentioned on the commencement certificate, include a binding collaboration, development, or joint development agreement attesting to the rights of the promoter to enter into transactions for the Sale Component.

Other Documents Mandatory:

Promoter's PAN Card
Legal Title Report
Details of Encumbrance
Approved Building and Layout Plans
Declaration with regards to Commencement Certificate
Report from CERSAI (where required)
CA Certificate regarding Project Cost & Fund Withdrawal
Proforma of Allotment Letter & Agreement for Sale
Segment Bank Account details for project money

Clarity and Currency of Documents:

Ensure all documents are clear, accurate, and current at the time of submission to avoid delays or rejection of the registration application.

Insights into Legal Framework and Compliance

Regulatory Framework

DCPR 2034 and UDCPR establish specific norms regarding Floor Space Index (FSI), land use, re-development incentives, and special provisions for slum, cessed building, and cluster re-development projects. DCPR 2034 provisions such as 33(5), 33(7), 33(9), and 33(10) address various redevelopment scenarios, each of which has distinct compliance norms.

Hybrid Structure of Redevelopment Projects

Redevelopment proposals tend to have a mixed complexion, with the rehabilitation and sale components. While the Sale Component falls within MahaRERA regulations, rehabilitation is exempted from registration, except if available for sale, as clarified by the Maharashtra Real Estate Appellate Tribunal (MREAT). A clear appreciation of this holds significance for builders as well as buyers.

Role of Housing Societies and Developers

Housing societies are a critical component of the redevelopment activity under MahaRERA, who have been recognized as co-promoters. They have some liabilities and responsibilities akin to developers, and that is to ensure the compliance of the Act and protect the interest of their members.

Real-World Examples of Redevelopment

Dharavi Redevelopment Project: It is Asia's largest slum redevelopment project, which entails the rehabilitation of over 150,000 tenements and sale of additional units to fund the project, in total compliance with rigorous MahaRERA documentation and registration requirements.
Bhendi Bazaar Redevelopment: This project, under the management of the Saifee Burhani Upliftment Trust (SBUT), incorporates rehabilitation for existing residents and sale of new flats, with the Sale Component registered under MahaRERA and all documents being made available to the public.

Commitment to Transparency and Consumer Protection

Reforms introduced in MahaRERA in 2025 have improved compliance through the mandatory listing of all the certifications of a project, titles of land, and approvals on the websites of developers for public access. The prospective homebuyers are asked to verify such documents before making investments, thus ensuring informed decision-making and preventing fraud risk.

Compliance and Penalties

Non-compliance with MahaRERA's documentation and registration requirements can lead to severe repercussions, including monetary fines, suspension of project registration, and potential criminal prosecution in extreme situations.

Best Practices for Promoters and Homebuyers

For Promoters:

Maintain up-to-date and accurate records that accurately represent the status of the project.
Report periodically to MahaRERA on project progress as per quarterly and annual reporting requirements.

For Homebuyers:

Check the MahaRERA registration status of the Sale Component.
Authenticate uploaded documents and check the legal status and approvals.

Conclusion

Adherence to the provided registration and documentation protocols allows redevelopment projects in Maharashtra to ensure greater transparency, responsibility, and trust among all stakeholders. The robust regulatory mechanism offered by MahaRERA not only safeguards homebuyers but also allows for a smoother redevelopment process, which translates to sustainable urban development.