In a unique decision, the Haryana Real Estate Regulatory Authority (HRERA) has blacklisted two major real estate companies — M/s Empire Realtech Pvt Ltd and M/s CHD Developers — and barred them from further registration of new projects till their ongoing projects are completed.
Taking stern note of continuous delay in completion of developer’s ongoing project – 106 Golf Avenue, Sector 106 in Gurgaon, HRERA has also served the notice to the developers to either face cancellation of registration of project or to complete it and hand over possession to the allottees. Apprehending siphoning of funds meant for the project, HRERA has also decided to hold a forensic audit of the project.
A bench headed by the HRERA chairman Dr KK Khandelwal and comprising SC Kush and Samir Kumar took the decision.
In a statement, HRERA said: “M/s Empire Realtech Pvt. Ltd. launched a project ‘106 Golf Avenue, Sector – 106, Gurugram’ in the year 2011 and possession of the apartment was to be given by the December 2016 but even after four years of delay the buyers are running from pillar to post for their apartments. The promoter intimated revised date for completion of the project to RERA as June 30, 2021. But, keeping in view the present situation of funds and stage of construction there is every likelihood of further delay of project. The quarterly progress reports have not been submitted by the promoter. There are 642 units in the project out of which 600 units have been sold. Nearly Rs 500 crore have been collected from the allottees by the year 2016. The promoter has also taken loan of around Rs 150 crore out of which Rs 36 crore is still outstanding. Despite availability of funds, both from allottees as well as lenders, the project is far from completion. There are nine towers in the project and in only three towers 80 per cent work has been completed. The construction is stuck up from October 2018. The allottees are very much disturbed as even after payment of 90 per cent of the cost of the apartment, there is no possibility of taking possession of the unit in near future. It seems that funds have been siphoned off by the promoter as even after receiving more than Rs 600 crore from the allottees and lending institutions, only Rs 168 crore have been incurred on the construction”.
HRERA also called a meeting of the association of allottees along with the promoter and the mitigation plan for completion of project was discussed at length.
“The promoter has not opened separate RERA account of the project. Installments of the allottees were received in the Escrow Account of the bank and all money deposited there in was taken away by the lender and nothing left for construction whereas 70 per cent amount should have been deposited in separate RERA account to be used only for construction. This is clear violation of section 4 of the Real Estate (Regulation and Development) Act, 2016 and warrants penal proceedings under section 60 of the Act against the promoter”, HRERA spokesperson said.
“Notice has been issued to the promoter as to why penal proceedings be not initiated and a penalty which may go upto 5 per cent of the cost of the project i.e. Rs 28.38 crore be not imposed. The promoter has been asked to submit mitigation plan for completion of the project within a month in consultation with the association of allottees. The authority has also given an option to the association of allottees whether they are willing to take over the project for its completion”, the spokesperson added.
“The promoter has done gross violation of conditions of the registration by not achieving the requisite progress on quarterly basis so that the date mentioned for completion of the project at the time of registration is achieved. The association has suggested to take over the project and complete it. The authority is examining the proposal of the association. The promoter has been asked to infuse funds for completion of the project which is estimated to Rs. 104 crore. The allottees have lost their faith in the promoter and are not willing to pay any more amount to the promoter,” the spokesperson added.
“There are other incomplete projects of abnormally delayed possession of the same promoter like CHD Van Group Housing spread over 10 acres of land and CHD Rosertico (Commercial, 10 acres) wherein inquiry is also being ordered by the authority. These too are stressed projects. The authority has issued show cause notice as why promoter is not blacklisted and debarred from development of any project till completion of these projects,” the spokesperson said.
Promoter charged from Rs 84 lakhs to Rs 1.5 crore per unit from the allottees who are widows, senior citizens, retired employees both from army and civil. These allottees are not only paying EMIs to the bank but also rent to the landlords which could have been avoided if possession of their respective apartments would have been given on the due date.
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