One of the things that cause the most stress when any Housing Society starts a Redevelopment process, is finding a good and reliable Builder. Selecting a Builder, negotiating various terms and dealing with them and their team is one of the most stressful things is like organizing a wedding.

The first and foremost qualification of any Builder is that he should be transparent, reliable and trustworthy. Whilst the best way to find a Builder is to go by Tendering System which has to be implemented in compliance with guidelines issued by the Government of Maharashtra in a Circular bearing No. CHS 2007/CR554/14-C, Co-operation, Marketing and Textiles Department Date: 3rd January 2009 which contain directives under Section 79 (A) of Maharashtra Co-operative Societies Act 1960 for all the Co-operative Housing Societies in the State of Maharashtra regarding the Redevelopment of Buildings of Co-operative Housing Societies.

The Managing Committee of the Society shall hold the Special General Meeting and with the consensus of at least ¾ of the members present, shall nominate certain senior members of the Society to form a Sub-Committee for Redevelopment which shall work in association with the Managing Committee to share the responsibilities for successful completion of Redevelopment.

Please remember that unless there is full co-ordination amongst the members of the Society, a non-corrupt Managing Committee and Sub-Committee appointed for the purpose designated, no Redevelopment Project shall be accomplished successfully.

Pursuant to the completed formalities of tendering system and as per the directives given in the Govt. Circular as referred in Para 2 above, sealed tenders so received, are to be opened in presence of the members of Sub-Committee appointed for Redevelopment who, after checking the merit, reputation, technical capability, experience, financial status, quality of construction and successful completion of projects etc. by the Builders including their various offers to the members of the Society, will prepare a comparative chart and select minimum 5 bids and if the bids received are less than 5, all bids shall be placed before the Special General Meeting and finally, after discussing the comparative chart in the meeting, the shortlisted bidder will be informed about the decision of the Special General Body.

In the final meeting convened by the Managing Committee in connection with the selection of the Builder for the Redevelopment, the Society at its own cost shall provide for video recording of the business transacted at this meeting. The Managing Committee shall ensure that no other persons other than the members shall be allowed to remain present and participate in the meeting. For this purpose, the Managing Committee shall give Identification Card (I.D. Card) to every member for his/her identification as the bonafide member of the Society. 

Decision regarding the selection of Builder and other decisions shall, in a final Special General Body Meeting of the Society, be resolved in presence of the authorized representative of Registrar, Co-Operative Societies. Please remember that as per the guidelines of the Government, any Committee member or Office Bearer of the Society should not be the Builder or relative of the Builder.

The following are certain formalities which are strictly to be adhered to, by the Managing Committee which are co-related to the Circular bearing No. CHS 2007/CR554/14-C dated: 3rd January 2009 issued by Co-operation, Marketing and Textiles Department of Government of Maharashtra.

1. Appointment of Representative of Registrar of co-operative societies: The Managing Committee of the Society within 8 days from the closing date of receipt of the tenders from Builders shall make an application to the Registrar of co-op, Society to appoint his representative to attend the Special General Meeting.

2. Special General Meeting for finalization of Final Tender: After the appointment of representative of Registrar and with his prior permission after fixing date, place and time of meeting with him, the Secretary of the Society shall convene a Special General Meeting within one month of his appointment giving 14 days notice of time, place and date of meeting along with the agenda to all the members. The notice shall be sent by hand delivery or by post to all members with their due acknowledgements which shall be kept in the office of the Society. The Society shall also invite representatives of the Builders to remain present at the meeting.

3. Absence of required quorum at special General Meeting: Quorum for the Special General Meeting shall be ¾ of the total number of members. If there is 1:10 quorum present at the special general Meeting it shall be adjourned for eight days. If there is no required quorum present at the adjourned Special General Meeting, it shall be deemed that the members of the Society are not interested in the Redevelopment of building and the meeting shall stand dissolved with remarks that the Redevelopment of building proposal shall not be allowed to be presented again in Special General Meeting till completion of a one year period from the date of the dissolved Special General Meeting.

4. Proceedings at the Special General Meeting in respect of selection of Builder: The authorized officer of Registrars of Cooperative societies will remain present at above Special General Meeting convened for selection of Builder as an observer. On necessary presence of representatives and the officer deputed by the Registrar, and if the proper quorum i.e. ¾ of the total number of members of the Society is present, the Special General Meeting will transact the following business:

Comparative information in respect of tenders of Redevelopment submitted by selected Builders for presentation of their proposals.

Tenders to be presented in chronological order

To approve terms and conditions of one of the Builders and finalize and select from the said tenders

To take approval of the selected tender

To acquaint members about further work of the Redevelopment

Consent of ¾ members present at the meeting in writing is a must for appointment of a Builder. It should be noted that if the selected Builder or his representative is not present at this meeting, it shall be presumed that they have the consent to the proceedings and other aspects of the Redevelopment.

Here are certain criterions to observe about a selection of a genuine Builder. Never ever select a Builder simply on the basis of his financial offers and exorbitant increase in carpet area and promises to provide amazing and astonishing amenities etc. His selection should be exclusively being based on his merit, reputation, technical capability, experience, financial status, quality of construction and successful completion of his earlier projects etc.

Visit their Website – Visit their website to know whether they have good reputation and who are their clients. Ask for those references and see if you can view work they have done previously that is similar to the project you are starting. This will give you the opportunity to speak to other clients and look at the quality and durability of the work.

Start dates – A reputed Builder will always be busy. You should be prepared to have to wait several weeks or even a few months before your Builder is able to commence the redevelopment process. When you ask them to quote for the same, talk to them about when they might be able to start. Someone who can start immediately may not be the Builder for you.

Builders who “cold call” – Good Builders are always in demand and always busy. They never turn up on your doorstep asking if they can undertake your redevelopment project. If a Builder knocks on your door and offers to do a job, turn them away.

Construction period – A redevelopment project may take couple of years or maximum three for completion, depending on the scale of property, after the work commences on the site. The Builder should ensure timely completion, physical possession, as committed to the Society. It shall be Builder’s responsibility to obtain Occupancy Certificate from the Municipal Authority. However, the Builder will have to pay the rent for the period until he delivers the new property after the Occupancy Certificate is received.

Experience – As within any profession, a Builder will have a certain amount of experience for their progression within the trade. This experience is what the well known and reputed Builder will draw upon when redevelopment project is undertaken and that is why it is important to hire an eminent Builder who has the type of experienced team you can rely upon.  

Knowledge – A professional Builder will always do their best to ensure that they have this level of knowledge throughout every part of their work and service. This means that not only will they have the necessary technical knowledge but they will also have knowledge of other professional local tradesmen working within the area, various permits required in the construction work being undertaken on your property and the specialized building regulations which will need to be adhered to at all times during the construction work. This in-depth knowledge possessed by the professional Builder will help guarantee that your construction work will be at the right time, using the right materials for the right price. Needless to say knowledge is invaluable. 

Safety – The knowledge which is possessed by a professional Builder is also a vital part of the customer having the peace of mind that the construction work has been undertaken with all safety measures at the forefront. This means that not only will the completed work on your property safely adhere to all the relevant building regulations but it will also ensure that it should add value to your home.

Quality of Construction –The Developers must ensure good quality materials and proper workmanship. Specifications as per Development Agreement should be adhered to and statutory specifications of the Local Planning Authority should be complied with. Proper technical supervision on site should be ensured through qualified and experienced technical personnel in addition to usual qualified structural engineers and architects. 

Defects Liability Clause – Builder should incorporate in Development Agreement, a clause for defect liability for a minimum period of 36 months or as per prevailing laws from the date of handing over of possession or intimation to the Society upon receiving the Occupancy Certificate from Municipality regarding the readiness to hand over possession, whichever is earlier and which shall be limited to the defects in the construction (i.e. structure) and not on the bought out materials most of which are covered under varied warranty periods by the manufacturers themselves.

However, in the event of recurring problem with the bought out materials, the member shall co-operate with the purchaser in sorting out the issue. This defect liability shall not cover force majeure situations such as damage resulting from war, flood, earthquakes etc.

Availability – A professional Builder will probably be busy with other jobs and you may have to wait for them to fit you in. If a Builder says they can start the next day, they may not be the professional Builder you are looking for.

Plans – A professional Builder adheres to the plans and ensures that no unauthorized construction is carried out which may subject the Society for distasteful and repulsive action from the Municipal Authorities at a later date. Builders who don’t want to work from plans should be regarded with suspicion – particularly as the planning department and building regulations officers will want to ensure that the building is going up exactly as approved.

Tender Document – Tender Document should contain extensive and genuine details on Financial, Technical and General Information of the Builder. Make sure to get the information on present or past litigation cases in any Court against the Builder by way of declaration.

To sum up this article, we once again stress that a good Builder is expected of lot of thoughtful process of redevelopment, knowledge, experience and expertise in design, planning, construction and executing the same with passion to deliver human friendly projects. The Builder selected, should be of unshakable reputation for quality, efficiency, trust, meticulous planning, top quality amenities, superlative designs, timely completion, guaranteed possessions and handing over of property of the Society for rehabilitation of its members.

Please educate yourself and caution your friendly neighbors to be vigilant from Irregularities and illegalities in Redevelopment by the Builders, Illegal gratifications showered by Builders on corrupt members of Managing Committees, Rampant Corruption in BMC, Flagrant violation of Rules and Regulations by the Builders, how to beware of Cheat and Fraud Builders and their criminal and felonious acts.

Dilip Shah

Senior Counselor and Analyst for Redevelopment of Housing Societies and Society Laws