MahaRERA grants Palais Royale developer one more year for completion

While granting the extension even after these observations, Mehta remarked that the Act was intended to promote the real estate sector in an efficient and transparent manner and protect the interest of consumers. “Thus, by not extending the registration of the sale project, the same shall be stalled

MUMBAI: The Maharashtra Real Estate Regulatory Authority (MahaRERA) has granted a year’s extension to the under-construction tower at Worli, Palais Royale, and directed the promoter to obtain an Occupancy Certificate by December 30, 2024, much to the chagrin of home buyers waiting for their homes for over 10 years.

MahaRERA grants Palais Royale developer one more year for completion

Honest Shelters Pvt Ltd, the promoter-developer, had filed an extension application on November 23, and sought extension of the possession date to December 30, 2024. In its order dated December 28, MahaRERA pointed out that at the time of registration, the developer had submitted December 31, 2021 as the date of completion. It stated that it had already granted him three extensions (due to the Covid-19 pandemic, which was granted to all projects), and had extended the date to December 30, 2023.

During the hearings, the promoter had cited pending litigations as the reason for delay in completion, and sought extension under Section 7 (3) of RERA. Sub Section 3 under Section 7, which empowers MahaRERA to revoke the registration of a project, states that the Authority may, instead of revoking the registration, allow it to remain in force, subject to certain terms and conditions it thinks fit to impose in the interest of the allottees. Any conditions, it adds, will remain binding upon the promoter.

Deciding the application, MahaRERA chairperson Ajoy Mehta noted that the promoter had not been able to obtain the consent of a two-thirds majority of homebuyers for extension as mandated by RERA provisions. He also observed that the Quarterly Progress Reports (QPRs), which give information on the number of bookings, sales and fund collection by the developer during the quarter, had not been updated by the promoter.

While granting the extension even after these observations, Mehta remarked that the Act was intended to promote the real estate sector in an efficient and transparent manner and protect the interest of consumers. “Thus, by not extending the registration of the sale project, the same shall be stalled. The promoter shall not be able to take action for efficient completion as may be required in view of the lack of registration. Such an action will only be detrimental to the interest of the consumer. Thus, the balance of convenience lies in allowing the extension with such condition so as to ensure completion. Further, the Authority also notes that this extension under 7(3) is the first extension and the same needs to be granted so that the completion of the project is not jeopardised,” (sic) said the order.

The order imposed the condition that the promoter would have to complete the balance construction work and obtain an OC by December 30, 2024. It also directed the developer to update the QPR by January 31, 2024. The Authority asked the developer to submit bar charts within 15 days, indicating the milestones to be achieved in respect of the completion of the project. The developer has also been asked to submit monthly progress reports to MahaRERA and the home buyers of the project.

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Originally promoted by Shreeram Urban Infrastructure Ltd, Palais Royale in Worli is one of the tallest buildings in India and began to be constructed in 2008. The project was stalled due to a PIL filed by NGO Janhit Manch, alleging building violations. In October 2019, the Supreme Court cleared the project for completion and dismissed an appeal by the NGO. The promoter had defaulted on ₹900-crore loans taken from Indiabulls Housing Finance Ltd in 2010, and Indiabulls put up the project for auction.

A Pune-based developer, Honest Shelters Pvt Ltd, purchased the project for ₹705 crore. Of the 164 apartments, 76 were booked earlier and home buyers included prominent doctors, fund managers, stockbrokers and NRIs, who had been waiting for their homes since 2010.

Information uploaded on the MahaRERA website says that the building has 76 sanctioned floors and 162 apartments, of which 77 are booked. Each apartment spans 4,000 to 8000 sq ft and has been booked for an average price of ₹50 crore. The Council for Tall Buildings and Urban Habitat, an international body monitoring highrises, had rated Palais Royale the tallest in Mumbai with a height of 300 m. However, Lokhandwala Minerva was later certified as the tallest completed building with a height of 300.6 m