More than 38% of the total 4,555 lapsed real estate projects in Maharashtra, also termed delayed, were launched and registered as "new projects" after the Maharashtra Real Estate Regulatory Authority (MahaRERA) was set up in May 2017, according to data accessed by Moneycontrol under the Right to Information (RTI) Act, 2005.
According to the data provided by MahaRERA, a total of 4,555 real estate projects had lapsed in Maharashtra as of March 31, 2022. Of these, 2,789 projects that lapsed were old projects delayed by more than six years and registered with MahaRERA as “ongoing projects.”
The remaining 1,766, or around 38%, were projects launched after May 2017, whose registrations also lapsed.
Ongoing and new project
When the Real Estate (Regulation and Development) Act came into effect, MahaRERA asked all new and ongoing projects to register the developments, without which they could not market, sell their units or get approvals.
All ongoing as well as under-construction projects that had not received completion certificates had to get registered with the regulatory authority within three months, i.e, July 31, 2017.
Projects with a plot size of a minimum 500 square metres, or eight apartments, also came under the purview of the Act. MahaRERA also levied a penalty on developers of ongoing projects who did not adhere to the deadline set for registering ongoing projects.
A new project is one that is starting afresh and has come into existence after MahaRERA became effective on May 1, 2017. All such projects launched after RERA Act came into effect have to register their projects with MahaRERA in order to market or sell units in them.
According to MahaRERA data, over 50 percent of the total projects registered as ongoing with MahaRERA when the regulator came into existence in 2017 are yet to be completed, according to data accessed by Moneycontrol under the Right To Information (RTI) Act.
About 13,246 projects were listed as ‘ongoing’ in 2017, of which 6,557, or about 49.5 percent, have been completed. A total of 36,461 projects, including the ongoing ones, have been registered since the inception of MahaRERA, of which 9,637 have been completed.
When is a real estate project declared as lapsed?
Every real estate project that is registered by a developer with MahaRERA is given three to four years for completion, considered a reasonable time period, followed by the issuance of a registration number for the project.
A simple search on the MahaRERA website using a registration number will give all details relating to the project. The registration number is to be published by the developer in every advertisement or promotion activity related to the project.
A project is termed as lapsed when the timeline given for completion is not met, and the developer has not applied for an extension.
Once the registration of the project is declared lapsed, the developer cannot advertise, market, book, sell or offer to sell, or invite people to invest in these projects. Such projects cannot be registered by the registrar of the revenue department.
MahaRERA on June 22, 2022 had launched a vertical dedicated to stalled projects or those projects whose registration had lapsed in Maharashtra. The vertical has been made operational and a separate team will be looking after stalled projects to ensure that these projects get moving, and home buyers get possession of their homes.
Ajoy Mehta, Chairman of MahaRERA, had in June 2022 said MahaRERA had registered 36,000 projects in the last five years worth Rs 8.69 lakh crore. Of these, around 10 percent, or 4,500 project registrations, have lapsed; their value is around Rs 78,000 crore.
Also Read: MahaRERA issues show-cause notices to 40 lapsed real estate projects in Maharashtra
Where are the lapsed projects?
According to the data provided by MahaRERA, the largest chunk of lapsed real estate projects in Maharashtra are in Pune and Mumbai with 1,216 and 649 lapsed projects, respectively. The third-highest number of such projects—560—are in Raigad district, with several areas falling under the Mumbai Metropolitan Region (MMR). This is followed by Thane and Palghar districts—also parts of MMR.
Fewer complaints against lapsed projects registered post-2017
According to the data, 17,290 complaints have been filed against registered real estate projects in Maharashtra since the inception of MahaRERA until June 30, 2022.
Of these, over 90% of complaints are against old projects that have been delayed for at least six years. Out of the total complaints, 15,841 are against ongoing projects and 1,439 complaints are against new projects registered post May 2017.
Also Read: MahaRERA to inspect construction sites for financial wrongdoings, over 300 large projects on radar
No checks on developers?
Nilesh Gala, a practising lawyer at MahaRERA, said: "Looking at the figures, it seems like MahaRERA is only there to collect money towards registration fees etc. There is no tap, cross-checking of data for the escrow accounts maintained by developers. Based on certificates from chartered accountants, withdrawal of money has been made. MahaRERA does not have sufficient qualified staff to monitor all the projects. This can be seen from the projects that were fraudulently registered in the Kalyan area near Mumbai. Till date, no stringent action has been taken against any promoter for lapsed projects. It has become a paradise for developers."
He added: "Also, the reason why there are very few complaints against the new projects launched post-2017, is because the complaints mechanism is such that the idea of protecting interest of home buyers is diluted and the essence of enactment of the Act has vanished completely. Date of possession is being changed in several projects without consent of homebuyers. This all demotivates homebuyers from going out and complaining. There needs to be a homebuyer-centric atmosphere."
A query sent by Moneycontrol to MahaRERA Chairman Ajoy Mehta over email and WhatsApp had not elicited any response as of the time this article was published.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
