The authorities of Noida and Greater Noida have introduced a comprehensive six-point strategy to address challenges within group housing projects, retrieve pending payments from developers, and facilitate property registrations.
The multifaceted plan encompasses the possibility of revoking plot allotments for projects that have yet to commence, providing an avenue for projects to be concluded in collaboration with co-developers in the event of stagnation, offering alternatives for project surrender, and even considering cancellations for non-compliant projects. In addition to these measures, the strategy aims to rearrange overdue payments for builders and streamline the process of executing sub-lease deeds for projects nearing completion.
Should developers opt not to avail themselves of these alternatives, the authorities retain the right to blacklist them or issue recovery certificates.
Officials have revealed that these propositions were initially presented to the chief minister during his June visit to Noida, subsequently undergoing discussions in the most recent board meetings this month.
Manoj Kumar Singh, the Industrial Development Commissioner and chairperson of both development authorities, directed officials to compile a comprehensive report. Their directive included comparing the proposals with the recommendations put forth by a central government committee led by former CEO of Niti Aayog, Amitabh Kant. This committee’s mandate was to find solutions to the challenges posed by stagnant projects.
Builders in Noida and Greater Noida owe a collective sum of over Rs 41,000 crore to the two authorities, with Noida alone accounting for Rs 26,570 crore of this debt.
Projects that have been allocated plots but remain inactive over an extended period will be subject to plot allotment cancellations. After deducting the deposited amounts in accordance with the lease deed, the residual funds will be placed into an escrow account to facilitate refunds for homebuyers, according to officials.
For incomplete yet economically viable projects, the authorities are contemplating the engagement of co-developers. This strategic move aims to expedite buyers’ possession of flats while simultaneously addressing the authorities’ pending dues.
Another recourse for debt recovery involves allowing developers to relinquish their projects if they are unable to see them through to completion.
The authorities are also considering reinstating a rescheduling policy, granting developers a two-year window to settle their outstanding payments in installments. This policy had been introduced in January of this year for a three-month duration and had been adopted by around 10 projects in Noida and 20 in Greater Noida.
Additionally, authorities have proposed a mechanism that would permit the registration of flats within projects that are on the verge of completion but are hindered by financial liabilities. Under this provision, the authority would take possession of unsold flats and designated areas intended for commercial and institutional purposes. Subsequently, flat registration equivalent in value to the unsold inventory in commercial and institutional zones would be authorized.
As an alternative approach, authorities could consider using unsold builder flats as collateral for mortgages, enabling the registration of homebuyer flats up to the value of those unsold units.