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What is a commencement certificate?

What is a commencement certificate?

A commencement certificate is a vital legal document typically issued by government bodies to real estate developers before they can start construction on properties. It indicates that the upcoming project complies with the necessary laws and safety regulations. Buyers must receive this document from the developer before buying their new home, which can help them avoid legal or compliance-related issues later.

Most certificates have indefinite validity if the builder adheres to the necessary regulations. However, depending on the locality and authority, they may have certain specified time limits. In some jurisdictions, individuals may also be able to apply for extensions or renewals in case of construction delays.

This article takes you through the commencement certificate meaning, its features and benefits, importance for home buyers, and more valuable information.

Features & benefits of a commencement certificate

  • Legal safeguard: The commencement certificate is a legal safeguard for buyers, protecting them against legal action if the construction project violates any regulations.
  • Approval for loans: Most financial institutions require this certificate before approving documents necessary for home loans. It assures the lender that the project meets legal requirements and lowers the risk involved in lending.
  • Ensures safety and legal requirements: The commencement certificate indicates that the upcoming construction project meets all legal prerequisites, including land use, construction norms, structural integrity standards, fire safety regulations, and earthquake resistance requirements.
  • Buyer protection: Commencement certificates serve as a protective net for the buyer. They ensure the buyer is protected against potential legal issues, as adherence to all norms prevents complications.

Importance of a commencement certificate for home buyers

  • Verify all documents: Home buyers must examine all property documents, including the commencement certificate, to stay protected against potential legal issues.
  • Proof of approval: The certificate confirms that the project has acquired the necessary government approvals, has a clear title, and settles dues.
  • Mention of specific floor or unit: The commencement certificate clearly states the exact floor or flat being purchased, as a lack of details can raise legal issues.
  • Prevents legal consequences: A valid commencement certificate safeguards buyers from penalties, demolition threats, or other consequences of unauthorized construction.
  • Buyer confidence: Having a commencement certificate in place provides security, financial ease, and peace of mind while making a property investment.

Who can apply for a commencement certificate?

A commencement certificate is usually issued to real estate developers working on construction projects. Developers or builders with sanctioned plans for their properties are eligible to apply for commencement certificates.

Documents required to apply for a commencement certificate

Before applying, developers must get their building plans approved and obtain the necessary licenses. The documents required for commencement certificate include:

  • Application form: This form must be submitted to the relevant local authority.
  • Building plan approval: After completing an application form, developers must submit architectural plans, layout plans, and elevation drawings that adhere to the required regulations and building codes.
  • Land ownership documents: Legal proof of land ownership is necessary for construction. This includes ownership affidavits like title deeds.
  • No Objection Certificates (NOCs): Builders must provide NOC documents from health, water, fire, and sanitation departments.
  • Other documents: Some other documents include the latest tax-paid receipts and photographs.

Why should a buyer know about the commencement certificate?

New homeowners must check with their developers and ensure they have this document before purchasing a property. Through the commencement certificate, RERA protects the buyer from unsafe and illegal constructions. No purchase should be finalized without the commencement certificate.

The commencement certificate is also crucial to the complete set of property papers. It is especially important when financing your purchase, as lending institutions thoroughly verify this document when calculating home loan interest rates.

How to check a commencement certificate online?

Homeowners or potential buyers can find and verify commencement certificates online using the following steps:

  • Visit the local authority’s website, which issued your commencement certificate. Look for the section titled “Certificates,” “Services,” or “Building Permits.” Commencement certificates are typically located here.
  • Select the option for commencement certificates and click on the option to check its status. This may be labelled “Verify Certificate” or “Check Status.”
  • Enter the necessary details, including the project name, certificate number, and applicant details, and click submit.
  • This will display the status of your certificate. If there are discrepancies, it is essential to contact the necessary authorities for clarification.

Conclusion

Before purchasing a new property or home, buyers must be well-informed and equipped with the necessary information and documents. This can help to streamline the purchasing process. If you want to purchase a new home, using a home loan can help you finance it easily.

Tata Capital offers home loans with long loan tenures, attractive interest rates, an easy application process, and flexible financing. For expert guidance and information regarding home loans, visit the Tata Capital website, or download the app today!

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FAQs

What are CC and OC in property?

A Commencement Certificate (CC) and an Occupation Certificate (OC) are documents issued by government authorities for real estate properties. A CC verifies that a building is approved for construction, and an OC verifies that it is safe for occupancy.

Which comes first, CC or OC?

The Commencement Certificate is issued before the Occupancy Certificate (OC). It certifies that the construction has been approved. The OC is issued after the construction is ready for possession.

What if I didn't get the Commencement Certificate when I bought the house?

The construction may have been illegal if an individual purchases a property without a commencement certificate. In such cases, seeking legal advice and exploring potential legal remedies is vital.

Is the Commencement Certificate compulsory?

Yes, the developer is required to have a Commencement Certificate before beginning construction. The buyer should also have it since it indicates that the construction and title are legal.

Where can I file for a business commencement certificate?

You can apply for a business commencement certificate online through the Ministry of Corporate Affairs (MCA). The form you must download and submit is the Form INC-20A. You will need to log in to the portal, head to the e-Filing section, and then complete the form with your company’s details. You must also submit the prescribed fee to proceed.

How long does it take to receive a commencement certificate after applying?

Generally, the time taken to receive the commencement certificate is around 30 to 45 days after the application is submitted. Local authorities complete the necessary evaluations and verifications during this period, ensuring regulations are adhered to before issuing the certificate.

Can I start construction work without a commencement certificate?

It is illegal to start construction work without a commencement certificate. You may have to pay heavy penalties and suffer the consequences of legal actions if you don’t comply with the requirements. In certain cases, it can also result in the cessation or suspension of the construction process.

Can I transfer a commencement certificate to another party or project?

No, typically, you cannot transfer a commencement certificate to another party or project, and doing so can result in legal challenges. A government body issues a certificate for a designated project, and you must use it for that purpose only.

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