You can say, when the bank has sanctioned loan and legal opinion is clear, The reason is, bank will sanction loan based on land records only. Because it is under-construction property and the bank will not see any building violations in case of under-construction property. Even if they know, they will not raise any objections, because everything is legal as per the agreement and payment schedule.
n Bangalore, 60-70% of the bank business is from real estate. Who on the earth will worry for OC and Khata? Because finally, the bank will catch the buyer for repayment of loan and not the builder for building violations. Bank, builder, BBMP, sub-registrar office, BDA – all are hand-in-glove. All of them know very well that the builder is violating the bye-laws but all keep silent. The reason is, everybody is party to this and they don’t want to stop this.
Ensure that the builder commits OC and ‘A’ Khata in writing and make it as part of Sale Agreement / Sale Deed. Make the payment schedule reflect the stages for actual completion of your flat and also till handing over all the legal documents like OC and ‘A’ Khata. Make the bank release payment only after completion of each stage. Instruct bank to release payment only after receiving written approval from you (builder generally sends demand note to banker for payment release and puts pressure on bank for release of payment) Form an association along with other residents so that pressure can be put on the builder to deliver as per schedule and commitments.
Check that the builder has all the necessary clearances, like sanctioned plan, commencement certificate etc. After the completion of the project, ensure that the builder hands over whole set of documents to residents association Ensure that the builder doesn’t violate the sanctioned plan/bye-laws Now, an under-construction property attracts same VAT as a completed apartment, so you won't save anything.
The builder requires to have the approval or sanctions from the concerned authority for the construction of a building. The building constructed without sanctions or deviated more than 5 per cent from approved plan levies penalty and authorities has right to demolish the building without any prior notice.
Completion Certificate: Completion certificate is mandatory for building constructed before selling or occupied. Issuing of Completion Certificate will ensure that the builder or owner has constructed the building as per approved plan.
However, note that the occupancy certificate is not needed for registration of the property during purchase. This often leads buyers to believe that the occupancy certificate is not important.