Moving Into A New House? Check Your Occupancy Certificate

Home purchase is an important landmark in one's life. But before you move into your new abode, it is important to check if all documents are in the right order. One such document is the occupancy certificate (OC). Also known as completion certificate or the pass certificate, it certifies that a building has been completed and has complied with the approved plan. Issued by the municipal corporation concerned to the developer of any building with more than five units, it is given to a building or some part of it but not individually to every single unit. In case, a developer is unable to provide the occupancy certificate, this means the building has not been approved under the legal plan.

An OC is required while applying for a loan or mortgage, and for resale of the premises. As it is illegal to reside on the premises without obtaining an OC, it is also sought by departments providing amenities like electricity, drinking water and sewage connection. In case a developer has already taken the utility connection, it could be disconnected at any point in the absence of an OC.

It is imperative for a buyer to ask for a commencement certificate if he purchases an under-construction property and demands an occupancy certificate if the property is ready for possession.

Before granting an OC,  approvals have to be obtained from:

• Fire department 
• Electrical inspectorate
• Municipal corporation (for operating elevators)
• The civic body (that it has been built according to the sanctioned plan; deviation of up to five per cent is allowed)
• Waste management area and sewage treatment plant
• A rainwater harvesting system certified by the Central Pollution Control Board.
• The Airport Authority of India, if the project lies in the range of an airport.

Why is it illegal to occupy a building without procuring an OC?

• The building might not be capable of managing its waste, sewage, water, etc. This may not only cause inconvenience to the occupant but also trouble the neighbours. The local environment would be degraded if the waste management, rain-water harvesting system, etc, are not in place.
• The building might not be safe to inhabit because of poor quality of construction, safety, etc. So, the developer, buyer, tenant, or servants, would be at risk residing in such a property. As the building is technically unfit for occupation, if any accident occurs, the person would not be able to hold anyone liable or claim any insurance or compensation.

How are people able to reside in a building without obtaining OC?

• Many a time, the registration of a property is allowed even in the absence of the OC.
• The developer obtains the electricity, water, sewage connection during the construction stage. Civic authorities do not bother about severing the connection if the occupancy certificate is not obtained.
• As developers and buyers complete the process in a haste, they tend to ignore the OC.
• Most of the times, it is the buyer's ignorance about any such certificate that lands him or her in a trouble at a later stage.
• Some bye-laws in the country are not consumer-friendly. Tangled in red-tape and bureaucratic hurdles, an OC remains pending for months without any reason. This needs to be curbed and a maximum time period -- within which the municipal corporation has to either grant the OC or reject it, with reasons -- should be prescribed.
• In a bid to make more profits, builders tend to shortchange buyers and compromise on construction quality. They either make more floors or leave less vacant space. To hide their malpractices, they tend to avoid even applying for an OC.