Maha Rera in a recent case had decided that a public authority involved in selling land to developers cannot be made a promoter along with the builder in the housing project. A complaint was filed by Navi Mumbai builders who are members of CREDAI-MCHI (Raigad) opting that the City and Industrial Development Corporation (CIDCO) to be made co-promoter of their projects.
It was stated in the complaint that CIDCO has delayed its obligation and thus due to this their projects get held up and are held liable for delay. Also added that CIDCO must be made a promoter under Rera because it is a public authority and MCHI members are allottees of plots owned by CIDCO.
Gautam Chatterjee, MahaRera chairperson is of the view that the sale under CIDCO are of immovable property and permission for those sale is not given by competent authority and also stated that those transaction does not fall under the definition of real estate project.
The order said Cidco can be made a promoter along with the builder in cases where Cidco is mandated to develop "off-site infrastructure" around the plot.
It was also mentioned in complaint that MCHI said CIDCO does not pay attention for registering tenders inviting bids with Rera though it is compulsory. CIDCO has not followed the provisions of Rera in its agreements and dealings with the highest bidder and is contravening the provisions of Rera.
It is necessary for CIDCO to register the scheme with RERA before advertising, marketing and inviting bids for the same. Other necessary functions of pre-and post-tender such as removal of encroachments and encumbrances, final demarcation of plots, providing water and drainage connections.
The builders, who planned to file an appeal against Chatterjee's order, stated Cidco often is delayed in carrying out these tasks. As a result, they face flak from flat buyers, who drag them before the housing authority for project delays. Also they added, Cidco falls under the ambit of 'promoter' under Rera and its activities of inviting bids for plots and allotment of the same for lease of 60 years fall under the provisions of Rera.
Counsel for Cidco said the corporation sold plots after a public tender to prospective developers to develop and construct flats to be sold to third parties. It was also found out that they we are not liable to register the sale of such plots with MahaRera.
In his order, Chatterjee stated that if the developer's plot acquired from Cidco is dependent on certain off-site infrastructure that has to be provided by Cidco, then "while registering their projects with MahaRera, the builders can include Cidco as a promoter (land-owner)".
Courtesy/By: Renu Kathale
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21 Jun 2019
