The Uttar Pradesh Cabinet, led by Chief Minister Yogi Adityanath, on December 19 approved the recommendations of Amitabh Kant committee on legacy stuck projects comprising a slew of relaxations for developers, including a zero-period to waive interest and penalties imposed for financial default, officials aware of the matter said.
The move will help homebuyers in getting possession and registry of their flats, some of whose homes have been delayed for almost a decade, they added.
Suresh Kumar Khanna, state finance minister, said that lakhs of homebuyers are waiting for their homes in the National Capital Region (NCR), especially Noida and Greater Noida, due to stuck projects because of poor financial conditions of developers.
“Amitabh Kant Committee has main two recommendations – first that homebuyers should get possession of their homes and the registry should be done, and the second that there should be a zero period to developers for projects disrupted during COVID-19. The committee had also recommended that the registry and sub-lease deed of homebuyers should be executed immediately. The interests of homebuyers should be protected and hence the Cabinet on December 19 approved and implemented the recommendations of the Amitabh Kant committee,” Khanna said in a press conference after the Cabinet.
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A proposal in this connection was prepared by the Industrial Development Department of the UP government, which has been approved by the Cabinet, he said.
The UP finance minister added that the zero period will be given for a period between April 1, 2020 and March 31, 2022, in place of COVID-19 disruptions caused to real estate projects.
The Union government, in March 2023, had formed a 14-member panel headed by former CEO of NITI Aayog Amitabh Kant to address the issue of stuck housing projects.
To enable developers to improve their finances and complete delayed or stalled housing projects, the panel had proposed a zero period or moratorium on payments that builders owe land-owning authorities, with the provision that they clear their dues in stages.
Real-estate developers collectively owe around Rs 46,000 crore to the development authorities in Gautam Budh Nagar. They owe almost Rs 26,000 crore to the Noida Authority and about Rs 14,000 crore to the Greater Noida Authority. The dues for the Yamuna Expressway Authority stand at Rs 4,700 crore.
Citing estimates by the Indian Banks' Association, Khanna said that there are around 4.12 lakh incomplete houses across the country in different real estate projects, which could not be completed due to poor financial conditions of developers. Out of 4.12 lakh, around 2.4 lakh houses are awaiting completion in NCR only, Khanna said.
He said that the implementation of these recommendations will protect the interests of homebuyers as it will help in the completion of stalled legacy projects and will also ensure timely delivery of houses under delayed projects.
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He said that these relaxations will not apply to commercial, sports and entertainment-related real estate projects.
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