Mumbai’s Occupation Certificate Amnesty Scheme: Grant and its implications

The original 2004 Amnesty Scheme, issued under UDD guidelines dated 23 August 2004, did not generate the expected response. In December 2022, the BMC therefore proposed a revised scheme, including an extension of the eligibility cut-off date (datum line) from 25 March 1991 to 6 January 2012, to cover a larger number of buildings that were already occupied.

Extension of the datum line

The UDD consented to extending the datum line to 6 January 2012, covering buildings occupied before the implementation of fungible Floor Space Index (FSI), i.e., a compensatory floor space allowance that counts previously exempt areas such as balconies, flower beds, dry balconies, etc., in total FSI calculations in exchange for a premium payable to the BMC. For buildings that did not obtain an OC after 6 January 2012 but are currently occupied, the BMC has been directed to consider independent guidelines. Buildings that were occupied or granted construction permission before 17 November 2016 may also be considered under a revised datum line. Housing societies will, however, need to establish occupation before the applicable datum line through documents such as property tax receipts or electricity bills.

The UDD has also directed that the factual status and opinions submitted by the BMC, together with the UDD’s remarks, be considered in implementing the revised guidelines.

A key element of the scheme is the reduction in certain premiums, fees and penalties.

50% concession on additional FSI and fungible area premiums

The UDD has approved a 50% concession on premium payable for additional FSI and fungible compensatory FSI, calculated at the prevailing Ready Reckoner rate at the time of submission of the OC proposal under the scheme. This concession is available only where the application seeks to regularise features or elevations that were approved but subsequently misused or enclosed, without any additional horizontal or vertical construction beyond the approved building plan. This concession is available only for tenements having a RERA carpet area of up to 80 sq. mts. This threshold may increase following regularisation. However, the concession will not be available for existing tenements having a RERA carpet area exceeding 80 sq. mts.

For societies and owners, these concessions may materially reduce the cost of regularisation. Developers with legacy projects may also wish to assess whether eligible projects can be brought within the scheme before the applicable concessions cease to be available. Stakeholders should ensure that proposals are submitted within the prescribed time limit and that discrepancies in relevant documents are rectified promptly.

Time-bound penalty concessions

For elevation features or free FSI Features that have been converted to habitable use, the scheme provides a graded penalty structure:

These time limits create a practical incentive for eligible stakeholders to assess their position early rather than treating the scheme as an open-ended regularisation window.

For old buildings where construction was carried out in accordance with the approved plan but without a valid Commencement Certificate (CC), the scheme also contemplates regularisation with a 50% concession on penalty and revalidation charges.

One of the more significant features is the introduction of a mechanism for part OCs for individual flats. The UDD has directed the BMC to prepare independent guidelines and an online system for this purpose.

Under the framework:

1. additional FSI, fungible FSI or Transferable Development Rights (TDR) may be utilised proportionately to the area of the flat, calculated as carpet area × 1.15, from the maximum building potential permissible on the plot;
2. no additional parking demand would arise merely because a part OC is granted, since there would be no increase in occupant load;
3. a mechanism would be established to balance the FSI utilised at the building level; and
4. an individual applicant would not be required to demolish unauthorised construction in common areas that are unrelated to the applicant’s flat.

The scheme also seeks to ensure that additional construction areas sanctioned for individual flat owners do not exceed the permissible FSI of the plot. Accordingly, where 15% FSI has been utilised to grant an OC, such additional area shall remain permissible only to the extent that sufficient FSI is available on the plot. This could be particularly relevant to individual flat owners who have been unable to regularise or transact their flats because of defaults or non-compliances affecting the building as a whole. It may also be relevant to purchasers and lenders assessing properties in buildings with unresolved OC issues.

However, individual flat owners should ensure that the requisite NOC is obtained from the owner or developer who originally submitted the development proposal or holds development rights, as this is a necessary condition under the scheme. If the owner or developer refuses to provide such an NOC, the scheme provides for issuance of a notice under the Mumbai Municipal Corporation Act, 1888 (MMC Act), and publication of such notice on AutoDCR, the BMC’s online software system which automates the scrutiny and approval of building plans, will be deemed to constitute service on the owner or developer in accordance with the government’s directions. However, this mechanism can be implemented only after the UDD issues the necessary directions for a temporary amendment to the MMC Act.

The UDD has acknowledged the potential for co-operative housing societies to apply for an OC where the owner/developer has defaulted. It has noted that, given delays attributable to owners/developers, a right has accrued to occupiers to seek an OC and regularisation of non-FSI areas through fungible and/or additional FSI/TDR.

The framework contemplates that all cases shall be published on AutoDCR through a separate tab for ‘OC Amnesty Scheme’ where all proposals received under the scheme will be listed. These proposals should be submitted through an architect or licensed surveyor. The online publication is intended to ensure transparency and provide interested parties with an opportunity to raise objections within 15 days from the date of publication on AutoDCR. After expiry of this 15-day period, the proposals will be scrutinised by the concerned Building and Proposal department of the BMC.

For housing societies, this potentially changes the practical route to resolving long-standing OC issues. Societies may no longer have to remain entirely dependent on a defaulting developer or owner to pursue the process. At the same time, societies should consider the potential contractual and legal consequences of proceeding independently, including disputes concerning responsibility for regularisation costs and obligations under the MMC Act.

For redevelopment proposals, the UDD has directed that the OC for the rehabilitation building/wings/component be de-linked from the sale building. Non-compliances or violations in the sale building should not affect the rehabilitation building.

This could be particularly relevant to redevelopment projects where legacy or developer-related issues in the sale component have delayed the grant of OC for rehabilitation premises. The measure may help reduce the risk of rehabilitation beneficiaries being adversely affected by defaults unrelated to their premises.

The scheme extends beyond residential buildings to hospitals and schools, recognising the broader public interest in regularising occupied public-use buildings that remain without OCs.

The scheme should not be understood as an automatic waiver of other regulatory requirements. Certain issues remain subject to specific conditions.

Building Completion Certificate (BCC)

Where the architect or licensed surveyor has not submitted the BCC, the society or individual flat owners will need to appoint a new architect/licensed surveyor to certify the executed work and submit amended plans reflecting the existing status of the building.

Non-submission of Property Card with area in words

Where the Property Card does not specify the area in words, an OC may be granted without insisting on the area being stated in words.

This could be particularly relevant where there is a discrepancy between the area stated in figures and in words, or where the area in words has not been recorded due to typographical or other documentation-related error. In such cases, the BMC is not permitted to hold up the grant of an OC on this ground and may instead prepare a list of such proposals and refer the matter to the UDD for taking it up with the Collector.

Incomplete infrastructure development

Where infrastructure such as layout roads, sewer lines, etc., has not been developed, the OC is to be granted on an ‘as is where is’ basis.

However, stakeholders should note that the society will be required to furnish an undertaking and an indemnity bond indemnifying the BMC against future litigation.

Recreational grounds, development plan roads and setbacks

The BMC is expected to remove encroachments on recreational grounds (RG) and other development plan reservations and take over such reservations when encroachments are brought to its notice. However, an individual flat owner seeking a part OC would not be required to remove an encroachment on a common area unless further construction beyond the earlier CC is sought.

For setback/Development Plan Road (DP Road), when additional FSI on payment of premium/TDR has not been utilised, removal of encroachment may not be insisted upon and OC may be granted with a condition that use of additional FSI on payment of premium/TDR for such a building will be allowed only upon removal of the encroachment on the setback/DP Road.

Accordingly, stakeholders should not assume that the amnesty will dispense with the need to address encroachments or other issues affecting reserved land separately, where applicable.

Civil Aviation No Objection Certificate

Where a required Civil Aviation No Objection Certificate (NOC) has not been obtained or revalidated, an OC cannot be granted unless a fresh NOC is submitted, particularly where the building height is not permissible under the Colour Coded Zoning Maps. The Airports Authority of India is also expected to verify the building height.

This is an important limitation for owners and investors in buildings located close to airports: the amnesty does not override applicable height restrictions or the requirement for aviation clearances.

Maharashtra Housing and Area Development Authority NOC

For proposals under Regulation 33(7) of the Development Control and Promotion Regulations for Greater Mumbai 2034, a Maharashtra Housing and Area Development Authority (MHADA) NOC remains mandatory before an OC can be granted. This is intended to ensure that certified existing occupants are rehabilitated and that surplus built-up area required to be handed over to MHADA is duly transferred.

For redevelopment projects, this requirement could remain a significant procedural consideration even where other aspects of the property qualify for the amnesty.