By CA Ashwin Shah & Adv Maitri Shah,
Carpet area is commonly understood by a layperson as the space within a premises where a carpet can practically be laid, thereby reflecting the realistic area available for residential or commercial use. Frequently, one also encounters the terms “Built-up Area” and “Super Built-up Area.”During the period when the MOFA Act was in force, planning authorities commonly relied on the concept of built-up area by adding a specified percentage to the actual carpet area for the purpose of calculating FSI consumption. In Maharashtra, particularly in metropolitan cities, municipal corporations generally add up to 20% over the carpet area to determine the built-up area. This built-up area includes a proportionate share of common areas, with a loading factor of approximately 20% over the actual carpet area. In contrast, the concept of super built-up area has largely been used by developers for marketing apartments by adding anywhere between 40% to 60% over the actual carpet area. Developers typically account for the entire common area and proportionately allocate it across individual apartments. This approach is adopted as developers incur costs on land, which need to be apportioned among apartments in proportion to their carpet areas. Such practices also enable developers to project lower price bands when quoting super built-up areas instead of actual carpet area. These are essentially marketing strategies adopted to portray competitive pricing vis-à-vis other projects.
WHAT IS MOFA CARPET AREA?
MOFA, or the Maharashtra Ownership Flats Act, defines carpet area as the net usable area within an apartment. While it generally excludes the area covered by external walls, it may include internal partition walls, balconies, and in certain cases, terraces. This interpretation of carpet area under MOFA often resulted in inconsistencies and variations in calculation. Under MOFA, carpet area was computed by including internal partitions and balconies, which afforded developers greater flexibility to inflate the stated carpet area. However, since external walls were excluded, the actual usable area frequently fell short of buyers’ expectations.
MISCONCEPTIONS REGARDING MOFA CARPET AREA
Many purchasers assumed that carpet area encompassed all spaces within the apartment. However, under MOFA, this was not necessarily the case. The absence of a clear statutory definition often led to misunderstandings and, at times, legal disputes between flat purchasers and developers.
WHAT IS RERA CARPET AREA?
The Real Estate (Regulation and Development) Act, 2016 (RERA) introduced a significant change by providing a statutory definition of carpet area under Section 2(k).
RERA defines carpet area as the net usable floor area of an apartment, expressly excluding:
- Area covered by external walls
- Areas under service shafts
- Exclusive balcony or verandah area
- Exclusive open terrace area
At the same time, the definition includes the area covered by internal partition walls.
The Act further clarifies that exclusive balconies, verandahs, and terraces, though appurtenant to the apartment, must be disclosed separately and cannot be included within the carpet area. This definition ushered in uniformity, transparency, and comparability across real estate projects. Post-RERA, developers are legally mandated to sell, advertise, and execute agreements strictly on the basis of carpet area, thereby rendering the practice of selling units on built-up or super built-up area impermissible for RERA-registered projects.
DIFFERENCE BETWEEN MOFA AND RERA CARPET AREA
The fundamental difference between MOFA and RERA carpet area lies in the aspects of clarity and standardisation. Under MOFA, carpet area was loosely defined and inconsistently interpreted. In contrast, RERA provides a precise and mandatory definition.
The primary distinction relates to the treatment of balconies, terraces, and wall areas. The most significant divergence between MOFA and RERA carpet area definitions is the inclusion or exclusion of these components:
- Under MOFA, balconies and terraces were at times included within carpet area, resulting in inflated measurements.
- Under RERA, such areas are excluded, with carpet area being confined to internal usable space, including internal walls.
CARPET AREA DILEMMA IN REDEVELOPMENT
The carpet area dilemma in redevelopment projects arises due to the overlap of two legal regimes—MOFA governing the old building proposed to be demolished and RERA governing the newly constructed building.
Existing buildings were generally constructed and sold under MOFA, with areas described in built-up or approximate terms. During redevelopment, however, newly constructed flats must comply with RERA-defined carpet area norms. This often creates a perception among existing occupants that their entitled area has been reduced, even when the actual usable area remains the same or has improved.
Broadly, it can be concluded that in residential buildings, there is a difference of approximately 5% to 8% between MOFA carpet area and RERA carpet area, depending upon factors such as structural complexity and internal wall configuration.
NEGOTIATION BETWEEN SOCIETY AND DEVELOPER
Typically, a housing society first undertakes actual measurement of carpet area, often referred to as the usable carpet area concept, and thereafter prepares a feasibility report with the assistance of a Project Management Consultant. The extent of additional free area offered over the existing usable area depends on the overall feasibility of the project and the net revenue potential for the developer.
Issues arise when MOFA carpet area needs to be reflected as RERA carpet area in the Permanent Alternate Accommodation Agreement. Although it is not mandatory to mention RERA carpet area in agreements between society members and developers, as such arrangements are not regulated under RERA, members often insist on specifying RERA carpet area. This insistence is driven by alignment with terminology familiar to prospective purchasers in the redeveloped building and for future sale transactions, since RERA terminology has become widely accepted following the enactment of the Act.
CONCLUSION
The carpet area dilemma in redevelopment is not merely about numerical increase or reduction. It signifies a transition from ambiguity to precision. Successful redevelopment depends upon transparent measurement practices, clear communication, and a fair translation of existing rights into the new legal framework without diminishing the member’s actual usable living space. People generally understand and are willing to accept the concept of usable carpet area, as it directly translates into functional utility. Both MOFA and RERA carpet areas are notional measurements that include or exclude certain components which may or may not be usable. It is therefore essential for societies and their members to carefully examine the feasibility report and negotiate effectively with prospective developers to secure a higher usable carpet area, thereby enhancing their standard of living.
