Builders dare to exploit; no fear of law

News Point: It is not one or two developers, but builders in their collective spirit are flouting norms and exploiting homebuyers in Noida.

Homebuyers harassment, Project delays, Developers fault, Builders' high handedness, Real estate malpractices, Realty complaints, Homebuyers' woes, India real estate news, India property market, Noida property market, ATS, Amrapali, Supertech, Panchsheel,, Track2Realty, GaursonsThe homebuyers of Panchsheel Hynish in Noida Extension were taken by surprise when the builder asked them to pay an additional amount of Rs. 1,60,000 to initiate proceedings of possession from company’s side. The builders’ argument is that he has not availed the extra FAR being granted by the Noida Authority in lieu of additional compensation to the farmers. Another additional charge has been asked for the developers’ own mistake to increase the size of the each apartment by 10 square feet, though without the buyers’ consent.

“We are middle class homebuyers with limited resources but if I deny to pay this unjustified amount I will not get the possession and I may end up spending even more money in litigations. I feel indeed harassed and helpless in such a system where there is no justice against the builders’ cheating,” says a distressed homebuyer Chanda Sharma (name changed on request).

In Greater Noida Supertech constructed 1009 additional apartments with its project Czar over and above the sanctioned plans for 844 apartments. Worst part is that half of these unauthorised apartments were sold even though the Greater Noida Authority sent the builder show cause notice for the violation of rules. Earlier in a similar incident, Supertech added extra towers to its project Emerald Court in Noida and the court ordered its demolition. The matter is still pending before the Supreme Court.

Similarly, delayed possession and false promises have landed Amrapali Group in serious trouble as homebuyers cry foul, celebrity endorsements backing off and political connections deserting. A defiant Amrapali Group yet tries to blame the market slowdown and other factors but to self.

Amrapali Group CMD Dr Anil Sharma says, “Sometimes there are so many unforeseen reasons. There are so many force majeure, which are beyond the control of a developer. So, during those periods construction is stopped for two years, three years, four years, five years. Those periods can’t be contracted. There are two losses, one is time loss, other is finance loss. We are not burdening that finance loss to our esteemed customers, but time loss we can’t make up. Ultimately, time loss has to be extended.”

Then there are developers like Jaypee Group and Unitech which openly declare they have no funds to complete the projects. All that they assure to the buyers is that the buyers have no other option but to wait instead of delaying the process further by litigations. Gaursons is also facing the homebuyers’ wrath today for delayed possession and unmet promises.

Mind it! These are the instances of branded developers who command a premium in the North Indian markets. If one takes into account the lesser-known developers and very many fly-by-night operators then the picture would be even more scary. This raises a fundamental question as to whether the government authorities are blind over the blatant cheating by these developers or there is something more than what meets the eyes.

After all, the developers have not only trapped the homebuyers but also duped the development authorities of Noida, Greater Noida and Yamuna Expressway. In more than 100 real estate projects the developers like ATS, Supertech, Unitech, Orris, Omaxe and Logix have defaulted on payment of land cost to the government in Noida, Greater Noida and Yamuna Expressway areas. The amount is staggering Rs. 10,000 crore.

They have rather deliberately created a catch-22 situation for the authority, and if the authority does not time and again reschedule their due payment, the fate of the homebuyers who have invested their hard earned money hangs in balance.

In an email query sent by Track2Realty, all these developers refused to comment. They did not oblige despite of repeated attempts on the phone calls either.

Requesting anonymity, a Noida-based analyst says that as a convenient option the land lease may be cancelled, if the project has not yet been launched. But for the projects already been sold the situation is really precarious and risky for the homebuyers.

Geetamber Anand, CREDAI President and CMD of ATS is known to champion the causes of the sector with a moral high ground. But in this case of default by his own company among others, he prefers to be silent. Homebuyers allege that whenever the fault lies with the builders, he creates a collective conspiracy of silence within the sector over the issue.

Even the homebuyers who have succumbed to pay the additional demands after full & final payment to the builders are not safe either. In many of the cases the developers have not deposited the Lease Rent amount collected from the buyers to the authorities. And hence, the registration of the apartment is not possible. The developers, on their part, are asking the homebuyers to take possession by signing an arbitrary undertaking to the developers.

The declaration that the homebuyers are forced to sign is not only arbitrary but also illegal in many cases, as it prima facie absolves the developer against any responsibility and puts the entire blame of unauthorised possession on the buyers.

The undertaking of Panchsheel Builder in Noida Extension to the distressed homebuyers reads: “I ….. Son of ….. Allotte(s) of Flat No. ….. Tower No. ….. at ….. Panchsheel Hynish, Plot No. GH-08, Sector 1, Greater Noida (W) UP have approached M/S Panchsheel Buildtech Pvt Ltd to handover the flat for fitment purpose which is inclusive of internal carpenter work etc so as to utilise our waiting period for lease deed in want of completion certificate. This favour will also save our time to do fitment work after registration of lease deed. I will pay the Electric Meter charges as and when informed by the company. I extend my undertaking to M/s Panchsheel Buildtech Pvt Ltd in case they hand over the flat during the waiting of lease deed I will keep the flat intact condition and would be liable for any damage, harm on account of noncompliance of any condition post-handover. I am committed to execute all the documents related to possession including lease deed, agreements etc as and when informed by M/s Panchsheel Buildtech Pvt Ltd after obtaining the completion certificate.”

Does this undertaking give the homebuyers any space? “I don’t have a choice because if I refuse to sign it I will not get a possession till endless time. For someone like me who is double burdened with house rent and the EMI, this is one way to compromise and save the rent. This whole housing eco system is fraud and I strongly suspect the involvement of government officials into this because whenever I have approached them they sound like the spokespersons of the builder,” says a homebuyer of the builder Lotus living in his apartment without registry through the builders’ dictated undertaking.

The malaise seems to be deep-rooted and this has been going on for the last many years. But the consumer activism & media support leading to judicial intervention has been exposing the nefarious designs of the builders, of late. Will it reach to a logical conclusion? Well, the fingers are still crossed but at least a good beginning has been made and this ‘Operation Clean-up’ was long overdue.

By: Ravi Sinha 

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