NOIDA: How effective are Rera recovery certificates (RC), which are meant to bring relief to tormented homebuyers?
In Noida, the largest real estate market in UP and also one with most of its problems – mainly of delayed deliveries and incomplete projects – only 5% of RCs issued by the real estate ombudsman since 2018 have been recovered.
RCs are issued under two clauses — Section 40 (1) of the UP Rera Act and Rule 23 of UP-Rera Rules — if aggrieved homebuyers approach Rera against defaulting developers for refunds, but the responsibility of realising the RCs lies with district administrations.
Data shared by the Noida administration shows till July 2023, out of 2,352 RCs that were issued since 2018 – collectively worth Rs 875.6 crore – only 118 with a collective worth of Rs 98.6 crore have been realised. This is just 5% of the total RCs issued.
Rera officials said execution of RCs picked up after the pandemic and another Rs 196 crore was recovered by the Noida administration this year, but the amount is yet to reflect in the administration’s logs. In June this year, the Wave Group cleared RC dues amounting to Rs 96 crore and another Rs 100 crore in RC dues was recovered between January and March this year, officials said.
Officials said RCs are also resolved through mutual consent between the developer and the homebuyer. “The problem is that developers and buyers, who are the complainants, fail to intimate Rera or the administration after an agreement is reached between the two parties. On the record logs, these RCs continue to be listed under the ‘unrealized’ category,” said an Rera official.
Of the around 3,400 group housing projects registered with the Rera, Noida leads the chart with a maximum of 945 projects, followed by Lucknow with 702 projects and Ghaziabad with 418.
A senior Noida administration official told TOI that the number of RCs recovered or resolved was higher than what its record books showed. Execution of some RCs has been affected as the cases are being heard by the National Company Law Tribunal (NCLT) and various courts.
“A total of 210 cases, collectively amounting to Rs 74 crore, are either pending in the NCLT or different courts and so the district administration can’t execute these RCs,” the official said.
Legal experts, however, said the regulatory authority should exercise its powers under Rule 24 to speed up RC execution proceedings. “It can do so by fixing deadlines for compliance reports from the collector’s office. But unfortunately, it seems the Rera, and even district administrations, have become legal shock absorbers for defaulting developers. It explains why execution of RCs in not just Noida and Ghaziabad, but the entire state is low,” Rajiv Ranjan Raj, a lawyer who deals in developer-homebuyers’ issues, said.
The Rera has issued nearly 8,800 RCs, collectively amounting to around Rs 2,400 crore, since 2018 across the state. Of this, RCs worth about Rs 1,200 crore have been resolved through recovery and settlement.
Published On Aug 17, 2023 at 09:22 AM IST
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