Wednesday, Sep 17, 2003
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By Our Special Correspondent
According to these new guidelines, such loan can be granted to the employees for purchase of flats and houses constructed by any private builder provided he is registered under the Companies Act or with Registrar of Firms under the Indian Partnership Act.
Further he should be registered as an approved builder with the Urban Development Authority or the Housing Boards of State Government or Municipal Authorities.
However, where a system for such registration does not exist, the builder should be required to produce an income tax clearance certificate or some such documentary evidence which shows that he has undertaken housing projects for Government agencies. Another pre-requisite for sanctioning of loan is that the builder has a clear title to the land.
Before sanctioning of the loan, an employee may also be required to obtain an undertaking from the builder certifying that the house or flat is ready for possession and occupation. A duty has also been cast on the sanctioning authority to ensure that the builder is financially sound with his audited accounts including balance sheet for the preceding three years duly certified by chartered accountants.
Significantly, the Government has also decided that the rate of interest of Housing Building Allowance prevalent on the date of release of advance/first instalment of advance will be the basis for determining the interest liability of the employee on the loan.
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