MUMBAI: In a landmark order, the Maharashtra Real Estate Regulatory Authority (MahaRERA) on Saturday directed not just the revocation of registration of the 16-year-old unfinished Clan City project in Rohinjan near Taloja but also gave the homebuyers association and housing society the permission to develop the remainder of the project themselves.
The order concerns 154 connected complaints filed by allottees against Supreme Construction and Developers Pvt Ltd and related parties. The township was registered in nine separate phases under different MahaRERA project registration numbers and has nine buildings of 34 storeys each. The complainants had sought varied reliefs such as possession of flats with interest as well as compensation, refund and revocation of project registration and the permission to hand the project over to another developer under Sections 7 and 8 of RERA.
“Many of us booked flats here from 2010 onwards,” said Kanchan Sharma, one of the heads of the Association of Allottees. “It was only in 2013 that the ground work actually commenced and the deadline was set at 2017, which wasn’t met with. In 2017, the developer asked for more money. The deadline was revised to March 2024, which once again lapsed.”
While hearing the case, MahaRERA member Mahesh Pathak noted that no deadline extension application was filed by the builder, besides which there was pending landowner litigation, with an ad interim injunction granted by the Bombay high court in April 2022, affecting construction.
During the initial hearing phase, MahaRERA set up a special conciliation panel, which after multiple hearings, submitted its final report on January 5, stating ‘Conciliation Failed’. The panel has also noticed the serious concerns regarding persistent non-compliance of the respondent promoter with MahaRERA orders, alleged diversion of project funds, absence of a viable completion plan, unviable escalation demands and lack of transparency regarding future phases and available FSI.
MahaRERA also noted that the project’s promoter secured sanctions from MMRDA as a ‘Rental Housing Scheme’ in 2010.
“The Panel also noticed that (the) project’s completion would require substantial funding and that (the) sale of unsold inventory is presently restrained by an ad interim injunction of the Hon’ble Bombay High Court. Accordingly, it recommended that the authorised Association of Allottees be permitted to approach the Hon’ble High Court for appropriate reliefs, including court-monitored sale of unsold units, escrow mechanisms, protection of landowners’ rights, pursuit of additional FSI or statutory benefits and engagement with MMRDA for resolution of the Rental Housing Component,” MahaRERA observed.
In its order, MahaRERA has declared the project as “stressed” and restrained the developer from any fresh sale, marketing, advertisement or creation of third-party rights.
“We are still consulting lawyers,” said Sharma on future plans. “It’s too early to decide whether we will go in for self-development or through a developer.”
The legal significance of the order is that the state government can be requested to relax and modify construction norms in the interest of flat purchasers, said Parth Chande, who appeared on behalf of the homebuyers association. “A project that has not been completed for over 15 years has been given the necessary directions and guidelines for completion,” he said. This order sets the stage for the possible revocation of a project’s registration and handing it over to another developer. It’s a ray of light at the end of a dark tunnel.”