MahaRERA initiates scrutiny of all lapsed projects

Manoj Saunik. File Photo

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has so far issued show-cause notices to 10,773 lapsed projects that were registered with the regulator since May 2017.

The notices have been issued to developers who have failed to update their project's status and related information with MahaRERA even after the project's completion date was initially submitted with the regulator. MahaRERA has taken serious cognisance of this irregularity and has issued show cause notices to around 10,773 projects, explained a MahaRERA official.

The developers of the lapsed projects are expected to submit an Occupation Certificate (OC) with Form 4 or seek an extension of projects. The application is to be supported with the requisite documents. In cases of such failures, MahaRERA may initiate strict action against the erring projects. Under this, so far, MahaRERA has initiated action by directly suspending or cancelling the project's registration, imposing punitive action, and issuing instructions to the Joint District Registrar directing not to register any purchase and sale of any flats in such projects. Even bank accounts associated with such projects may be frozen, the official said.

Section 11(1)(b), (c), (d) and (e) of The Real Estate (Regulation and Development) Act, 2016, makes it mandatory to update quarterly progress reports of every project. MahaRERA's order 33/2022 issued in July 2022 also states the action that may be initiated with regard to lapsed projects, he added.

He continued, "Of the 10,777 projects, the Mumbai Metropolitan Region, which includes the surrounding northern Konkan region has the highest lapsed projects at 5,231, followed by Pune region with 3,406, Nashik 815, Nagpur 548, Sambhaji Nagar 511, Amravati 201, Dadra & Nagar Haveli 43 and Daman & Diu 18 projects."

When applying for a MahaRERA registration number, every builder has to unambiguously mention the scheduled date of the project's completion. Towards the completion date, an occupancy certificate along with Form 4 certifying the project has been completed is mandatory to be submitted, the official said.

In case the project remains incomplete, the builder is expected to move the deadline extension application. Alternatively, if there are any issues with starting the project, it becomes necessary to apply for de-registration of the project. As per Sections 3, 4, 5 and 11 of the Real Estate (Regulation and Development) Act, 2016, as well as the order 33/2022 of July 2022, it is mandatory for the developers to update their project's projects every quarter as well as share annual reports on the website.

MahaRERA Chairman Manoj Saunik, confirming the same said, "Through the Compliance Cell, as per the regulatory provisions, the MahaRERA has initiated micro-monitoring of the real estate sector at multiple levels. Each of the projects registered with MahaRERA is required to submit a quarterly report as well as the project's status on the website, on a periodic basis. Presently, in Maharashtra, there are 10,773 real estate projects that have lapsed leading to investments of several homebuyers getting stuck."

Saunik continued, "As per the regulation, it is mandatory for the developers to submit an Occupancy Certificate (OC) along with Form 4 of their respective projects or to seek deadline revision. After the 30-day window provided to the developer has expired and the developer hasn't initiated any attempt to submit OC with Form 4 or sought a deadline's extension, MahaRERA is left with no other alternative but to either cancel or suspend the project's registration. This also means imposing restrictions on the sale and purchase of flats in such projects and also to freeze the bank accounts associated with the projects. MahaRERA urges the real estate industry not to put itself into such a situation."