BUILDING PROJECTS
1. INTRODUCTION
In India, the need and demand for both housing and infrastructure are enormous.
With the population crossing 1027 million in 2001, the magnitude of housing
shortage at the end of the 10th Plan was around 24.7 million units for 67.4 million
households. Further, it was estimated that 99% of this shortage pertains to EWS
& LIG categories. During the 11th Plan, it is estimated that the total housing
requirement (including backlog) will be to the tune of 26.53 million units for 75.01
million households.
The share of real estate as a percentage of Indias GDP has risen from 5.25% to
over 7% from 2002 to 2007. Returns from this sector exceed those for most other
investment alternatives. Yields on commercial real estate across million plus
cities in India are higher than those prevalent in global real estate markets. With
the revolution in the service sector over the last decade, the rise in the sectors
share of GDP to 50% marks a shift in the Indian economy and takes it closer to
that of a developed economy.
Real estate plays a catalytic role in fulfilling the need and demand for housing for
various classes. Equally important is need to provide backup infrastructure
covering utilities such as water supply, sewerage, drainage, solid waste
management, roads and transport as well as social infrastructure like schools,
health and recreation facilities, commercial infrastructure like markets/malls,
office complexes, technology parks etc. The cumulative effect, places the onus
on real estate and construction sector for providing an opportunity for conferring
social benefits.
175th Rank
Procedures (number) 37
2,394.9
India ranks 175, in terms of dealing with construction permits and on an average
there are 37 procedures involved before obtaining permission for undertaking
construction. Similarly, the cost incurred is about 2394 % of per capita income. It
clearly signifies that the procedure for obtaining clearances is time consuming
and projects often get stalled due to delay in obtaining clearances from various
agencies.
Similarly, as per CII draft report on Streamlining approval process for Housing
Projects, the approval process for housing projects is complex and a developer
needs to get about 51 approvals from the respective state authorities and other
agencies. There are few approvals like approval for Land use (use conversion in
Master Plan), and Environmental clearance that consume most of the time and
2
consequently delay the projects. The duration for taking these specific approvals
is about six months to one year and sometimes it stretches to two years
especially for approvals related to land.
2. NEED
FOR
STREAMLINING
THE
BUILDING
APPROVAL/SANCTION
PROCEDURE
The powers to frame Building Regulations/Bye-Laws vest with the Urban Local
Body or Urban Development Authority of State Government under statutory
provisions.
Building Regulations/Bye laws are a set of laws and procedures that all building
practitioners, such as builders, architects, design consultants, and contractors,
have to abide by, when engaging in the construction of a new building or in the
modification of an existing building with structural changes .
Land and Real Estate Development are State subjects. The procedure for
obtaining clearances varies from city to city in terms of time and number of
clearances as decided by the Urban Local Body/Urban Development Authority of
city concerned. Some examples are given as under:
On an average, Bangalore (25 days) and Indore (28 days), took less than
the stipulated time of 30 days while cities like Surat, Thiruvananthapuram
and Ranchi took more than 200 days to obtain building permit as per file
study. Delays in meeting the required deficiencies on the part of the
applicant are cited as the major reason for taking longer time for
approval.
Procedures
Cities
Delhi
Ludhiana
Kolkata
Ranchi
Mumbai
Surat
Trivandrum
Bangalore
Indore *
Lucknow
Procedure 1
Site
Inspection
(from the date
of receipt of
application)
Procedure 2
Scrutiny
(from the
date of
inspection)
Procedure 3
Sanction
(from the
date of
submission
of
application)
10 days
Not specified
7 days
30 days
Not specified
On spot
during
inspection
60 days
60 days
60 days
Not specified
Not specified
Any time
during
construction
without prior
notice
Not specified
15 days
Not specified
Not specified
Not specified
Not specified
Not specified
60 days
60 days
60 days
Not specified
30 days
30 days
30 days
30 days
Not specified
Not specified
In case of deficiencies:
Procedure 5
Procedure 4
Completion
Corrections/
of
Compliance
Compliance
intimated
(from the date of (After
intimation)
submission of
application)
45 days
30 days
Not specified
Not specified
Verbally intimated 7-30 days
to the LBS
engaged by the
applicant on spot
during inspection
or from office on
the next day
30 days
30 days
Not specified
Not specified
Not specified
30 days
Not specified
30 days
30 days
Not specified
Not specified
Procedure 6
Sanction
(from the
date of
Compliance)
15 days
Not specified
15 days
Not specified
60days
30 days
30 days
30 days
30 days
Not specified
NIUA Study on Doing Bussiness, 2008 brings forth the fact that reforms
have facilitated doing business in many Indian cities although some cities
still have cumbersome procedures involving high costs and delays
particularly in obtaining construction licenses. Bangalore, Delhi and Surat
involve least procedures in obtaining construction licenses. Bangalore
also requires least time (92 days) as compared to 149 days in Mumbai
and 285 days in Ranchi. Delhi incurs the least cost and Kolkata the
maximum when construction cost as a percentage of per capita income
of the respective city is considered.
The following figure attempts to explain the time taken to obtain building permits
as per NIUA Report,
body. It is in the interest of the public to get the building plan sanctioned. This
ensures that building constructed is structurally safe and has provisions for light ,
ventilation, hygienic conditions and is in conformity to the provisions of respective
Master Plans and Zoning regulations. Any construction raised without such
sanction is liable for demolition under various sections of building byelaws. It is
also mandatory under the byelaws to obtain a completion certificate without
which no person is permitted to occupy the building.
In the NCT of Delhi, only about 35% of the buildings have adhered to
building byelaws. This is because the provisions of the building byelaws often
entail cumbersome procedures, which are expensive and time consuming. The
following section overviews the mandatory/ special requirements for building
permits across cities.
harvesting certificate (Delhi and Lucknow), Malba certificate (Delhi) and NBO
certificate (Delhi and Bangalore) are needed only in few cities.
Plan: It includes key plan or location plan showing the boundary and location of
the site for most of the cities. However, in Mumbai, neighborhood landmarks are
also included in key plan. Here, the site plan is also very exhaustive and includes
the boundary of the site. The same is true for Trivandrum, Surat and Ludhiana. In
Surat, twenty requirements have been listed. In most of the other cities, such
details are not specified in the byelaws. In case of Mumbai and Surat, the sub
division or lay out plan is also required where development is proposed by sub
division or involves a lay out plan. However, in case of Mumbai it is more detailed
and exhaustive. Building plan requirements are also very extensive and
additional requirements with regard to multi storied or special buildings are to be
indicated in details. Bangalore city also has a detailed requirement of building
plan.
technical personnel or architect along with an affidavit from the owner is required.
In Bangalore, a copy of the property card along with the sketch issued by the
Department of Survey and Settlement, Land Records (City Survey) and latest
Assessment Book Extract issued by the Corporation indicating the measurement
of the property is required. Likewise, in Surat an applicant is supposed to submit
a certified copy of approved sub-division/layout of final plot from the concerned
Authority or latest approved sub-division/layout of city survey numbers or
revenue numbers from relevant Authority as the case may be, showing the area
and measurements of the plot or land on which the proposed construction is to
take place. The Authority may dispense with this requirement if the applicant
proves ownership on the basis of other documentary evidence.
floors,
approximate
number
of
inhabitants
proposed
to
be
10
In Mumbai, to ensure compliance with the Regulations and the directions given in
the sanctioned plan and other conditions, a security deposit13, is charged at rates
specified by the Commissioner. It is to be returned to the owner one year after
the issue of the full occupancy certificate after the Commissioner is satisfied with
the compliance of various conditions stipulated in the said, full occupancy
certificate.
Up-to-date property tax receipt: A receipt for having paid up to date property
tax to the ULB has to be attached for all cities.
creating any extra dwelling unit and an affidavit to the affect that building
materials shall not be stacked on Government land in cases of plot size more
than 418 sqm. are required. In Mumbai, the owner/developer/contractor has to
give an undertaking to the effect that during the period of construction, facilities
like day-care center, non-formal education programme, etc should be made
available to the workers.
1.
In case of any deviation from the terms and conditions stipulated in the lease
deed/ownership document, necessary clearance from the lessor.
2.
NOC from the competent authority regarding land use as per Master
Plan/Zonal Plan, if required.
3.
4.
5.
Approval from Chief Controller of Explosives, Nagpur and Chief Fire Officer,
in case of hazardous buildings.
6.
7.
Approval of Urban Art Commission wherever required under DUAC Act shall
have to be obtained before sanction of building plans in case of Delhi.
8.
9.
10. N.O.C. from ASI in case of plot falling within 300 mtrs. of any protected
monument.
11. N.O.C. from Metro Rail Authority in case plot is falling within MRTS corridor.
12
N.O.C. from Railway Authority in case plot is falling within railway corridor.
12
13. N.O.C. from Airport Authority in case plot is falling in close proximity to the
airport and in case of high rise buildings.
14. N.O.C. from Soil Department, Survey and Valuation and boundary
declaration department in case of Kolkata
15. N.O.C from Defence in case plot falls in proximity of Defence Land.
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7. GOVINDRAJAN COMMITTEE
14
8.
The format of Dealing with Licenses as per the World Bank Report Doing
Business in 2007 is indicated below which may be simplified and procedures
and number of days be minimized.
Procedure
Nature of Procedure
Duration
No.
(Days)
1.
145
2.
30
construction
4.
5.
6.
7.
8.
9.
14
10.
Final Inspection by MC
11.
Apply
for approval
of completed construction
from Fire
14
Department
12.
13.
30
14.
15.
65
16.
17.
15
Procedure
Nature of Procedure
Duration
No.
(Days)
18.
40
19.
14
20.
connection
Total
Total
=20
procedures
9.
Days>200
Rather than remove regulations and risk compromising life, safety or the
environment, the most effective streamlining initiatives need to focus on lining
up all regulatory agencies in a predictable linear process with emphasis on
facilitating
16
S.No.
Type of approval
Approving
Authority
Stage of project
Pre construction
Intimation of Disapproval
(IOD)
(Whether
applicable )
NOC
(if
near
sea/coastal areas)
Development
Authority/
Municipality
Development
Authority/
Municipality
Development
Authority/
Municipality
Coastal
Zone
Management
Authority
NHAI/PWD
Archaeological
Survey
of
India(ASI)
Ministry
of
Environment
Central Ground
Water Authority
Fire Department
5.
6.
Road access
Ancient
Monument
approval
7.
10
Environment clearance
(EC)
Borewell
Registration
Certificate
Fire Fighting Scheme
Approval
AAI Height NoC
11
Defence Clearance
12
8.
9
13
14
15
Building
Certificate
16
17
completion
Normal
Duration
(Days)
Reduction
in duration,
if Online
process is
introduced
Reduced
Duration
(Days)
30-60
10
Pre construction
15
10
Pre construction
30-60
Pre construction
Pre construction
30
30
20
20
10
10
Pre construction
180
150
30
Pre construction
15
10
Pre construction
30
20
10
Civil
Aviation
Department
Ministry
of
Defence
Electricity
Distribution
Authority
Pre construction
30-60
15
Pre construction
180
30
During
construction
15
10
Development
Authority
State Pollution
control Board
Development
Authority/
Municipality
Service
Departments/
Parastatals
During
construction
During
construction
Post construction
30-60
15
30-60
Post construction
30
20
10
Development
Authority/
Municipality
Post construction
15
10
Pre construction
Total Duration
17
300-360
90-100
Explanatory Notes:
1. The above Table indicates the processes after the applicant applies for
building approval with clear land title and possession of land. Hence,
clearances related to CLU and Land Title has not been considered.
2. The table illustrates the Duration of clearances obtained in Normal course
and suggests the reduced duration if The Approving Authority adopts online
sanctions.
3. Clearances indicated at S Nos. 4-10 are concurrent with applications at the
pre-construction stages, wherein their process of approval can be taken up
simultaneously.
4. Clearances indicated at S Nos. 11-13 are concurrent with applications
during-construction stage, wherein their process of approval can be taken up
simultaneously.
5. S No. 15 has to be linked with S No. 14, once applicant receives the
Completion Certificate, service plan clearances and connections would be
deemed to be sanctioned.
10.
The above suggested model is only indicative, however, there is scope for
streamlining the procedures for clearances to be obtained from various
departments in the least possible number of procedures and number of days.
The model should serve as a guide to Urban Local Bodies and Development
Authorities for adoption. Since the number of procedures and duration varies
from state to state, as per the local conditions, the model would require
modifications to suit a specific city. Some of the options which can reduce the
time taken for various procedures are:
(a)
Online sanctions:
building plan and completion certificate. This process reduces the time
taken to a large extent. The example of Pune and West Bengal may be
considered in other States.
(b)
The ULBs /
(d)
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