Karnataka RERA Allows Homebuyers To Take Over Delayed Project
In a rare case, Karnataka's real estate regulator has ordered homebuyers to take over a delayed luxury villa project from the developer and complete the construction. Invoking section 8 of the RERA Act, which allows resident welfare associations to take over a project, the Karnataka Real Estate Regulatory Authority (KRERA) noted that the developer, LGCL Urban Homes LLP, has failed to hand over possession even after 10 years. Bengaluru has over 26,030 delayed projects, worth over Rs 28,072 crore, that are running behind schedule. Previously, KRERA Chairman Kishore Chandra had said that homebuyers can approach the authority to take over and complete delayed projects themselves. You can read that report here. The project, located in Anekal, has 73 villas and six economically weaker section units. The Residents Welfare Association (RWA) registered as a cooperative society moved the authority claiming that the project had remained incomplete eight years after the commencement of construction. About 85 percent of the project is complete, and Rs 26 crore is required to finish the rest, the RWA claimed. "The homebuyers have formed an RWA under the Karnataka Cooperative Societies Act, 1959, which is legal. The developer has not honoured the completion of the project and the RWA has no other choice than to take over the project for completion," the order, dated February 22, noted. Additionally, the authority pointed out that the developer has failed to submit quarterly reports to KRERA, which is mandatory under the RERA Act. The developer also faces complaints in several other projects in Bengaluru. "Thus, the Authority is required to invoke Section 8 of the RERA Act and allow the cooperative society to intervene for completion of the project," the order said. KRERA said homebuyers have paid about Rs 14.3 crore to the landowner for power and infrastructure. “The remaining cost will be received by selling unsold inventories or by homebuyers paying the additional amount, subject to recovery in future as and when funds are available in the cooperative society's bank account—about Rs 24 crore from the sale of unsold inventory," the authority ordered. The KRERA ordered the developer to hand over the approved documents and no objection certificates. It also ordered the RWA to complete the project within 18 months of the order date.
Tags : KRERA Karnataka Cooperative Societies Act no objection certificates RERA Act LGCL Urban Homes LLP homebuyers cooperative society Kishore Chandra