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Construction Project Due Diligence for

Builders/Developers

CS Sanjay H. Indulkar- Company Secretary Corporate Advisory, Business Strategy & Transition, Fund Raising, Regulatory and Compliance. Mobile 9867161367 email: sindulkar@hotmail.com https://in.linkedin.com/in/sanjay-h-indulkar-8118651a Disclaimer: This is not advise is only for the information

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Construction Project Due Diligence for

Builders/Developers

STAGE 10

10 Marketing of the Project

Preamble:

Trailing Pages discuss about the due diligence for the builders and developers

Object:

The real estate (regulation and development) bill, 2013 is passed by both the houses and

shortly this bill will be Act . Just to update to all the stake holder in the Industry for

due diligence process as this will be the key to the project executions and deliveries

Facts :

Under this regime of the real estate (regulation and development) bill, 2013

# Section 2 definitions advertisement’’ means any document described or issued as

advertisement through any form of media and includes any notice, circular or other

documents offering for sale of a plot, building or apartment or inviting persons to

purchase in any manner such plot, building or apartment or to make advances or

deposits for such purposes;

# Section 3: Registration of the real estate Project

# Section 7 : Revocation of the registrations

Some takeaway from this bill and way forward

The duties on the builders / Developers is timely execution of the project and delays

will have the penalties including the interest. Current system of approvals and

consent is complex and time consuming. The purpose of this communication is to

update the builders and developers to mitigate risk involve in the project executions.

Now challenges builders will face is in the transition of the New Regulatory

Regime and this challenges will defer project to project

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STAGE 1:

1. before property buying

1.1 MOU through which you acquired the property

1.2 Title search papers. Checking 7/12 utara and details of CTS plan. Copies of stamp duty

payment /registration. Index of all the purchaser’s mutation Report. DP remarks.

/ CTS / survey nos and verification of property card

1.3 Public notice in newspapers before purchase of property

1.4 ROC registration check in case is LLP , OPC ,Section 8 Company or Company

1.5 Check done with regards to Litigation as regards the said property

1.6 Copy of agreement with the vendor chain of documents

STAGE 2:

2. Before intimation of disapproval (IOD ) is issued for development of plot (Case to

Case Basis )

2.1 Demarcation of Plot (Fencing and Boundry)

2.2 Obtain property card in owners name

2.3 Urban Land Ceiling (ULC) clearance

2.4 Check zone

2.5 Redevelopment permission

2.6 DP remarks

2.7 Forest/ private forest

2.8 Labour NOC

2.9 Highway NOC

2.10 CRZ NOC (1,2,3 or 4)e

2.11 Zone conversion

2.12 Amalgamation of property

2.13 NOC from MMRDA, if applicable

2.14 Survey of the plot to confirm the following:

a) Existing ground levels (w r t to THD)

b) Site elevation remarks

c) Sewage Line

d) Over Head (OH) Line

e) MTNL Line

f) Water Line

g) Road Level (w r t THD)

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h) Soil Investigation Report

2.15 FSI related (a) Evaluation of existing FSI and Maximum usage / exploitation of plot (b)

Type of additional FSI required / TDR arrangement etc and Loading the same

2.16 Broad evaluation of proposed project

2.17 Selection of architect (For BMC approval)

2.18 Approval of architect

2.19 Preparation of documents to be given to architect for submitting of proposal to SRA /

MCGM

(a) Plan submission by architect

(b) Ownership document i.e. 7/12, 6/12, CTS plan, PRC

2.20 Selection of various consultants based on project a) structural consultant b) services

consultant c) design architect d) environment consultant e) aviation consultant f) license

plumber

2.21 Soil investigation

2.22 Receipt of IOD

2.23 Consent to establish (If applicable)

2.24 Special planning authority

2.25 Railway authority NOC

2.26 Heritage conservation committee

2.27 NOC for cessed property in island city

2.28 Public parking lot

STAGE 3:

3. The following conditions to be complied with on receipt of intimation of disapproval

(IOD) further to which we go ahead to CC upto plinth Level

3.1 SWD remarks

3.2 NOC / drainage approval from EE sewerage

3.3 NOC

3.4 CFO, NOC

3.5 Traffic and co-ordination (if regular proposal)

3.6 NOC from mechanical and electrical

3.7 NOC from high rise committee

3.8 NOC from MoEF

3.9 Tree NOC

3.10 Appointment and acceptance of architect

3.11 Appointment and acceptance of site supervisor

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3.12 Appointment and acceptance letter of structural consultant

3.13 Photocopy of licenses of all licensed consultants

3.14 Photocopy of license of site supervisor

3.15 MTNL NOC

3.16 Borewell permission

3.17 HE NOC 3.18 No due certificate from AEWW

3.18 NOC from AE (Environment) from debris disposal

3.19 CTS plans

3.20 PR card

3.21 DP remarks

3.22 Rain water harvesting system

3.23 Non-agricultural permission

3.24 DP road PRC on MCGM name, if any

3.25 Registered undertaking (RUT) for agreeing to handover set back area, if any

3.26 Indemnity bond for damages risk, accidents

3.27 Undertaking regarding no nuisance

3.28 Regular/ sanctioned / proposed lines and reservation to be demarcated through AE

survey

3.29 Appointment of license plumber

3.30 NOC from assistant assessor and collector

3.31 RUT for not misusing stilt, pocket terrace etc

3.32 NOC from Reliance Energy

3.33 NOC from pest control dept

3.34 Insurance policy for workers

3.35 Janata insurance policy

3.36 RUT for not misusing basement

3.37 Certificate from structural engineer for complying requirement for earthquake design

3.38 Soil investigation report

3.39 Structural design and calculation with drawing by structural engineer

3.40 NOC from Airport Authority of India

3.41 Revalidation of ULC NOC, if required

3.42 Location clearance from police commissioner

3.43 NOC of PWD for theatre building

3.44 Labour license (to be taken by principal employer and handed over to contractor)

3.45 Submission of proposals with compliance to SRA / MCGM

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3.46 Preparation of estimates

3.47 Preparation of execution plan

3.48 Approval of execution plan

3.49 Completing preliminary work before commencement of project

3.50 Batching plant approval, if necessary

3.51 STP approval, size, location & capacity

3.52 NOC from environment section

3.53 Street light remarks

3.54 Approval of road consultant design from road department

STAGE 4:

4.Compliances after receipt of CC (Plinth level CC to full CC)

4.1 Award contract for construction

4.2 Statutory compliances for labour laws

4.3 Obtain Sanctions for:- a) temporary water connection (requirement of bore well, if any) b)

temporary electrical connection c) temporary drainage connection, if required d) temporary

structures

4.4 Excavation permission (royalty)

4.5 Checking of CC conditions and offsets

4.6 Arrange plinth level inspection

4.7 Plinth certificate from RCC consultant

4.8 Completion certificate from all consultants such as architects, licensed site supervisor,

RCC, PMC, TPQA (third party quality audit) and peer review of RCC consultant

4.9 Application of Full CC

STAGE 5:

5. CC to OC and compliances before applying for OC

5.1 Progress as per sanctioned plans

5.2 Review of project costs

Comply with the following before applying for OC

a) RCC consultant’s stability Certificate & RCC plan duly pasted on canvas

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b) Fire NOC by CFO

c) HE NOC

d) Lift inspector's NOC

e) Electric inspector NOC (Permanent Power & Substation etc)

f) Sewage dept NOC / drainage completion certificate

g) Diesel generator approval and registration

h) Final tree NOC

i) STP environmental clearance

j) STP work completion certificate

k) HE specific NOC for hydro-pneumatic system

l) PWD completion for theatre bldg

m) SWD completion certificate

n) Dry fittings approval (water pipe related)

o) Terrace looping for water line

p) Submission of 'P' form parallel

Receipt of OC

1) Road digging permission for laying water pipe line

2) Water connection (certificate)

3) Handing over property to new owners

4) Demobilisation

5) Closing accounts

a) Debris disposal receipt before submitting application for BCC 270

Permission from water department Receipt of Building Completion Certificate (BCC)

STAGE 6:

6. Conveyance to new owner (documents required to apply for conveyance)

6.1 7/12 Abstract / CTS

6.2 Search report and title clearance certificate from advocate

6.3 Index II of earlier owner

6.4 Property card of earlier owner

6.5 Conveyance deed of earlier owner with the name appearing in the proper card / 7/12

6.6 Transactions and chain of documents pertaining to the same as stated in the title report

6.7 Development agreement duly stamped, if applicable

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6.8 CC issued by MCGM

6.9 OC issue by MCGM + approved plan

6.10 BCC issued by MCGM

6.11 Proof of individual payment of registration fee

6.12 Original agreements executed by the builder with individual flat purchasers

6.13 Copy of IOD

6.14 Copy of previous Power of Attorney (if any)

6.15 ULC order, if applicable (normally under section 20 or 22)

6.16 Copy of list of NA Tax bill by the builder / land tax – collector documents that the

builder will handover to the new owner

a) Original documents of title to the property

b) Property power of attorney

c) Architectural and structural drawings

d) Audited statements of accounts for the amount collected by the developer / builder

e) Handing over all statutory approvals in original

f) Property tax to MCGM ii) tax clearance certificate (Check if a certificate such as No Dues

Certificate be obtained)

STAGE 7:

7. Highrise Committee (HRC) Checklist (if applicable)

7.1 Application form

7.2 Project personnel on record and contact information (Appendix-A)

7.3 Plot and geotechnical information (Appendix-B)

7.4 Conceptual location plan (1-3Km)

7.5 Architectural Set

a) Site Plan b) All Floor Plans and FSI Calculations c) Elevations d) Sections

7.6 Structural a) Drawings b) Report c) Wind Tunnel Analysis d) Peer Review

7.7 DC Regulation clearance

7.8 Environment clearance

7.9 Soil investigation report

7.10 Shadow analysis

7.11 Airflow analysis

7.12 Traffic analysis

7.13 Water and waste water management plan

7.14 Safety and disaster management plan

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7.15 Site summary report (To be made available at site at the time of Site Visit by technical

committee for High Rise Building along with Site plan & all Architectural Drawings)

Stage 8

8. Environmental Clearance (EC) Checklist - State Level Expert Appraisal

Committee (if applicable)

8.1 Application Form consisting of Appendix A (form 1) and Appendix B (form 1A)

Key Inputs:

a) Basic information of project

b) Activity

c) Use of natural resources in project

d) Use, storage, handling and production of materials

e) Production of solid wastes during construction or operation or decommissioning

f) Release of pollutants or hazardous substance to air

g) Generation of noise, emission and vibration of light and heat

h) Risks of contamination of land and water from releases of pollutants into ground or into

sewers, surface waters, groundwater, coastal waters or sea.

i) Risk of accidents during construction or operation of the project, which could affect human

health or the environment

j) Factors which should be considered (such as consequential development) which could lead

to environmental effect

8.2 Environment sensitivity

8.3 Environmental impacts

a) Land environment

b) Water environment

c) Vegetation

d) Fauna

e) Air environment

f) Aesthetics

g) Socio-economic aspects

h) Building materials

i) Energy conservation

j) Environmental management plan

8.4 Environmental infrastructure

a) Solid waste management

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b) Waste water treatment

c) Green area

d) Rain water harvesting

e) Energy conservation measures

f) Water requirement

g) Sewer line and drainage line details

h) Details of the EMP

i) Disaster management plan

8.6 List of native trees suitable for beautification in garden / building premises

Stage 9:

9. Building and Other Construction (boc) Workers Act 1996, Contract Labour

(Regulation and Abolition) Act (CLA), 1970 and Maharashtra Contract Labour

(Regulation & Abolition) Rule, 1971

9.1 Registration of principal employer owning the site (as per CLA)

9.2 Registration of contractors under contract Labour Regulation Act (as per CLA)

9.3 Registration of labour working at site by payment of Rs25 towards enrolment and Rs60

towards annual subscription. Total Rs85 per labour (by the contractor) (as per BOC)

9.4 Maintenance of records together with the safety provisions as follows:-

a) Every worker must wear and carry gumboots, helmets, safety belts and hand gloves

b) Muster cum wages register

c) Minimum wage

d) Labour camp / accommodation

e) Drinking water facility. It should be at least 100 mtr away from Urinals

f) Latrines and urinals separate for male / female

g) Crèches

h) Provision of First Aid

i) Medical check up at regular intervals by Govt medical officer

j) Canteens (250 workers)

k) Safety Officer

l) Identity Card for each

m) Fixing hours of work

n) Fire protection

o) Emergency action plans

p) Health and safety policy

q) Eye protective

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r) Dust, Gases, Furness etc

s) Provision of Nets across the site

t) Appropriate, preferably metal scaffoldings

Stage 10: Public Parking Lot Checklist - Parallel activity at any stage of IOD, CC or OC

(if applicable)

10. 1 Proposal submitted to Road Dept, MCGM

10.2 Road Dept sends note to

a) Jt CP – NOC b) CFO NOC c) Bldg Proposal NOC d) Urban Dept

10.3 Minutes approved on HPC (High Power Committee of MCGM)

10.4 UDD approves in principal

10.5 Sent to road department with remarks

10.6 LOI issued