The state government has said that builder taking benefit of the policy won’t be able to charge any amount from the buyer so that the benefit provided by the government reaches to the homebuyer.
UP cabinet on Tuesday gave approval to recommendations of a committee chaired by former NITI Aayog chairman and India’s G20 Sherpa Amitabh Kant, which is expected to infuse new life into more than 200,000 stalled flats in Noida, Greater Noida, and the Yamuna Expressway region, said property developers and industry experts.
“An independent chartered accountant or third party will recalculate the dues of the builder. In addition, no charges will be levied for giving three years of extension to the builder,” Infrastructure and Industrial Development Commissioner (IIDC) Manoj Kumar Singh has said in the letter written to Noida, Greater Noida and Yamuna authority.
According to the Confederation of Real Estate Developers’ Associations of India (CREDAI), 190,000 units worth Rs 1 lakh crore are stuck in Noida, Greater Noida, and Ghaziabad. In Greater Noida alone, at least 36 projects are facing insolvency proceedings.
“Once a developer agrees for the relief package, it has to submit 25% of the dues and the authority will give permission to mortgage so that builder can raise the fund to complete the project. If the due is less than Rs 100 crore, then it needs to be cleared within a year and if it is between Rs 100 crore and Rs 500 crore, then the builder will get two years time to clear it. For more than Rs 500 crore due, builder will get three year payment plan,” the letter says.The authority has said relief package will not be applicable for projects part of sports city scheme and commercial, institutional and industrial projects. The committee had recommended that the state government announce a rehabilitation package for financially distressed and incomplete projects.
The committee had recommended the introduction of a ‘Zero Period’ that would involve suspending interest and penalties due to events like the Covid-19 pandemic (April 1, 2020, to March 31, 2022) and court orders suspending projects within a 10-kilometre radius of the Okhla Bird Sanctuary (August 14, 2013 to August 19, 2015).
Concerned state governments could examine and provide further zero periods based on the local conditions and circumstances.
The committee had also advised applying interest rate based on the three-year marginal cost of fund-based lending rate (MCLR) SBI of June 1, 2020, for fresh calculation under this package to ensure a fair and consistent rate for all developers. The calculation should be done from the date of allotment and delivery of land to the developer.
For additional funds to ensure project completion, the committee recommended allowing developers to induct co-developers, either for entire projects or specific parts thereof, without any permission from Noida, Greater Noida, or land-owning authorities.
