MahaRERA issued a circular earlier this month. FileIF 50 PER cent home buyers agree to give them a “second chance”, builders lagging behind on construction deadlines can seek a further extension even after their one-year extension period is over, according to a circular issued by the Maharashtra Real Estate Regulatory Authority (MahaRERA) earlier this month.
“Many projects have stopped since 2017, but some are genuine. The MahaRERA has decided to give developers a second chance to complete delayed projects after the usual extension of a year, but only if a builder can get more than 50 per cent customers to agree,” said a senior MahaRERA official.
The MahaRERA circular states, “It is possible that a genuine promoter, after making good efforts, is unable to complete the project within the time stipulated at the time of initial declaration or under extended period. The law confers powers under Section 7 (of RERA Act) on the authority, in the larger public interest, to regulate the real estate sector. The authority shall be entitled to take into consideration reasons and circumstances due to which the project could not be completed within the extended aggregate period of one year as prescribed under Section 6. We, therefore, find a balanced approach, keeping in view the object and intent of the enactment, and the rights and liabilities of promoter and allottee in larger public interest is to be adopted.”
It further states, “We would observe that in case the promoter fails to complete the project in the prescribed time declared by him or the extended time under Section 6, then it shall not mean that the only outcome would be to oust the promoter from the project.”
In order to ensure that the interest of buyers are protected and completion of the MahaRERA registered project is achieved, the authority resolved that in cases where the promoter of a project was unable to complete the project in the extended time of one year, granted under Section 6, further extension might be given only in those cases where the concerned association of allottees resolved that instead of revoking the registration, the existing promoter should be permitted to complete the project in a specific time period and on payment of same fee as prescribed under the rules for extension.
Sources from MahaRERA said nearly 90 per cent of the complaints registered with the MahaRERA were regarding a delay in execution of projects. The real estate sector faced a rough patch in the last two to three years and was recovering at a slow pace.
Property consultants closely monitoring the market said the real estate sector was set to grow this year. The move has met with mixed reactions. Housing experts and some complainants, who had approached the RERA over delayed projects, felt that the step favoured developers.
A complainant said, “In every project, there are some investors present and what if the builder convinces some investors and a few home buyers to support the extension, what will happen to the other 49 per cent people involved in the project?”
Mumbai Grahak Panchayat (MGP) Shirish Deshpande, however, welcomed the move of giving a say to the consumers, but stressed that the authority should have specified that the “association of allottees” should be appointed after 50 per cent booking of flats in a project was done.
