Registration of 49 projects revoked for unfair trade practices

Shoulder: Kalyan MahaRERA scam

Strap: Housing regulator freezes bank accounts; urges civic authorities to upload CC, OC on dedicated portals to protect buyers

In a suo moto action, the state housing regulator, the Maharashtra Real Estate Regulatory Authority (MahaRERA), has revoked the registration of 49 projects being probed in Kalyan RERA scam for allegedly submitting fake commencement certificates for “unfair trade practices”, and directed that their designated bank accounts associated with the projects be frozen.

The order by a bench comprising MahaRERA chairperson, Ajoy Mehta and member Mahesh Pathak, came after a joint hearing at the Bandra Kurla Complex (BKC) headquarters of MahaRERA was held on October 28.

MahaRERA has also directed all departments such as Secretary, Urban Development, and local planning authorities to ensure that all statutory certificates like Commencement Certificates (CC) and Occupancy Certificate (OC) be uploaded immediately on their respective websites, as soon as they are issued. Any changes or modifications thereafter must also be immediately be updated.

To further contain the damage done after the scam was exposed by a whistleblower on September 28, the authority also restrained the promoters of all 49 projects from advertising, marketing, booking, selling or offering any apartment or building for sale in any of these projects.

During the physical hearing at the BKC office, only 24 out of 49 promoters or their representatives were present. Some of the advocates present sought more time as a criminal investigation was launched against their clients by Thane crime branch and pleaded that no “precipitatory action” be taken against their clients till the investigation is completed. MahaRERA bench heard the advocates, took on record the written submissions made and reserved its orders.

MahaRERA observed that as per Section 4 of Real Estate (Regulation and Development) Act, 2016, it is mandatory for all promoters seeking project registrations to submit the CC along with other approvals, the sanctioned plan, the layout plan and specifications of the proposed project.

The Authority noted that on August 17, 2022, it had received letters from the assistant director, Town Planning, Kalyan Dombivali Municipal Corporation (KDMC) that the CCs of these 49 projects had not been issued by the corporation and therefore they appeared to be obtained surreptitiously. It observed that therefore it can invoke the provisions of Section 7 of RERA.

“In the present case of not obtaining the CCs from the Competent Authority and misrepresenting to this Authority as well as the allottees/ home buyers and collecting money through misrepresentation and taking the bookings in the above-mentioned MahaRERA registered projects can be said to be unfair or deceptive practice,” noted the November 7 suo moto order by the bench.

MahaRERA also urged authorities to “immediately” put in place a system wherein all milestone approvals relevant to buyers are uploaded on a dedicated portal by the respective planning authority so that they can be verified by the buyers as well as the authority. “This shall be an important consumer protection measure,” the regulator suggested.

With the suo moto action, the list of projects where MahaRERA has terminated the registration of a project has swelled from 11 projects over five years till August this year, to 60 projects.