Big relief to home buyers! RERA moots policy to complete stalled projects

The authority recommended that such a policy can be formulated on the lines of Section 8 of the Real Estate (Regulation and Development) Act, 2016, under which it can allow completion of pending developmental work in a stalled project.

In a bid to provide relief to homebuyers in cases of stuck projects, Uttar Pradesh (UP) RERA has suggested to the state government to formulate a policy where the authority can direct homebuyers to form an association, which will then work on completing the stalled housing units. Else the authority, with participation of homebuyers, can go to the open market to hire a co-developer.

The authority recommended that such a policy can be formulated on the lines of Section 8 of the Real Estate (Regulation and Development) Act, 2016, under which it can allow completion of pending developmental work in a stalled project.

A senior state government official said UP RERA, in a letter to the state government, has suggested forming a policy on lines of Section 8. “The authority said progress of projects and timely completion is dependent on utilisation of money collected from homebuyers. To ensure this, it got around 210 projects audited and took necessary action based on the audit. It de-registered some projects and made a reference to the state government for deciding a policy about proceeding under Section 8 of the Act in such matters,” he added.

If this Section can be further utilised in a “more legalised institutional setting”, then RERA would be able to provide relief to around 25,000-30,000 home buyers. The state government is reviewing the proposal, the official said.

Section 8 provides that upon lapse of registration or revocation of registration under RERA, the authority may consult the government to take such action as it may deem fit, including carrying out the remaining development works by a competent authority or an association of allottees or in any other manner, as may be determined by it.

When contacted, UP RERA member Balwinder Kumar told FE, “We have written to the state government that first we can invite the homebuyers’ association to work with us for completing the remaining development work. If that is not possible, we will go to the open market and select a co-developer in a transparent procedure to complete pending work. It is important that we search within our own official spheres to find solutions for stalled projects.”

Another UP RERA official said top priority is providing relief through prompt hearing and complaint redressal. UP RERA’s track record proves this, he said, adding, “Before RERA, only 2,014 complaints were disposed by officials in the state of the total 5,139 registered complaints. However, this changed with formation of RERA. Around 12,780 complaints were filed and 8,506 complaints decided till August 2019.”

“Number of registered complaints in UP and their disposal by RERA is highest in the country,” the official noted. He added that there are a couple of cases in UP and Madhya Pradesh where the authority took action under Sections 7 and 8.

“The authority is also getting stressed projects inspected and has developed a mobile application for preparation and submission of reports online. These are uploaded on the web page of the project concerned. It has also issued show-cause notices to 21 projects in NCR and 17 non-NCR projects, where promoter has either not obtained completion or occupancy certificate nor applied for extension of project registration, but work is either going on or is stalled,” he explained.

UP RERA has also set up a panel of auditing firms for financial and forensic audit of projects and will soon embark upon the verification of escrow accounts of projects through the auditing firms on the panel of Institute of Chartered Accountants of India (ICAI).

At present, more than 17,900 complaints have been registered with UP RERA, which is the highest in the country. Of this, over 10,500 complaints have already been decided.

Source: https://www.financialexpress.com/industry/big-relief-to-home-buyers-rera-moots-policy-to-complete-stalled-projects/1766794/

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