All You Need To Know About Acquiring A Commencement Certificate To Start A Construction Business

 Establishing your business in a country like India, there are necessary rules and regulations you need to follow. Your work needs to be legal, and these norms help you form a strong base for it. The rules and regulations are prescribed by the government that provides you with a legal identity and other benefits. So to make your base stronger and legally supported, obtaining a commencement certificate for your business is mandatory. 


Acquiring a commencement certificate is crucial to start any business because only after obtaining it you are allowed to commence any work-related activities. In India, the newly announced Companies Amendment Ordinance, 2018 has re-introduced the concept of ‘Commencement of Business’. The same was abolished earlier by the Ministry of Cultural Affairs(MCA) under the Companies (Amendment) Act, 2015. 


The commencement certificate by MCA was brought into the public domain for new businesses and streamlining their authenticity. The business director of the company must file a declaration (form-20 A) attached with bank statements and payment receipts. 


For starting a construction business in India, one must look up RERA norms for establishing their business. The commencement certificate from RERA is as important as an occupancy certificate, ensuring the buyer about the building authorization. 


As per Section 2(m) of the RERA Act, 2016 “commencement certificate” means a certificate or the construction permit, issued by the competent authority to allow or permit the developer to begin the development work as per the sanctioned plan.  


What All Needs To Be Done To Acquire One


The developer needs to obtain it before starting the construction of a new project or a building. It is obtained from the local authorities to which the municipal authorities will conduct several preliminary checks before issuing the certificate. The commencement certificate is considered as an imperative document to ensure the buyer/investor that the property complex meets all the legal norms and requirements. 


For acquisition, the developer should submit the project plan to the concerned department to initiate the land inspection. It is also necessary to submit no-objection certificates (NOCs) that are obtained from various government departments, including fire, water, sanitation and electricity. Along with the NOCs, he needs to submit property documents, tax receipts and photographs of the property land.


The developer receives the certificate post all the inspection by the town planning and the engineering departments. 


Significance Of A Commencement Certificate (CC) For The Homebuyers 


If a developer does not obtain the CC before beginning the construction work, he will not be provided with an occupancy certificate by the authority. So, the document accounts for much significance in the course of construction. 


In the absence of CC, buying a property is indicative of illegal property or a disputed land. The certificate duly ensures that the property is secured with a clear title, dues and clearances. While buying, one should ensure that the certificate contains a listing of the residential unit for legal purposes. If not, the authorities have the right to penalize a person for accommodating an illegal property. Therefore, the certificate saves you from the possible legal consequences in future. 


There are recent cases, in which builders carry out the construction work without the required documents and legal processes. That only puts the builder at risk but also jeopardizes the future of the residents. 


Conclusion


Developers across the country build high-end projects equipped with various facilities and services. Sometimes to quicken the construction work, necessary documents such as occupancy and commencement are overlooked in the process. Therefore, homebuyers need to be careful when they are purchasing a property in any building. 


For developers who want to make the legal processes smooth and quick, they can opt for project management consultancies in town. A consultancy carries out all the mandates in acquiring all approvals, permits and certificates. If you are looking for a PMC in Mumbai, Buicons LLP Consultants provides full-fledged services for your building construction. Their team of professionals carry out all the mandatories on behalf of the developer and allows a smooth functioning of the project.


Visit their website to know more about their expertise and services. For further queries, get in touch.

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