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OTS 2020: UP waives penalty, allows property owners to pay dues in instalments
The Uttar Pradesh government, in an order issued February 7, rolled out the modalities for its recently announced one-time settlement (OTS-2020) scheme, approved
The Uttar Pradesh government, in an order issued February 7, rolled out the modalities for its recently announced one-time settlement (OTS-2020) scheme, approved by the UP cabinet last Thursday. Unlike earlier schemes, the state has allowed defaulting property owners to clear their dues in instalments, besides waiving the penal interest.
The OTS-2020 allows all property owners, who were either allotted plots or apartments under various schemes or had bought them in government auctions, to pay the principal amount and interest they have defaulted on without a penalty. The types of property include group housing societies, schools, charitable institutions and commercial properties, among others. The scheme will be applicable for all special area development authorities, development authorities and housing boards.
“After getting the government order, we have directed officials to make a list of defaulted properties. We will verify all applications we get under the OTS-2020. There will also be a case-to-case evaluation and calculation of default amount. About ₹600-800 crore are due from defaulters. We are expecting a response from them under the OTS scheme,” Ghaziabad development authority (GDA) vice-chairperson Kanchan Verma said.
According to the latest government order, the defaulter allottees will only have to pay the simple interest ascertained at the time of property allotment; they will not be required to pay any penal interest; payment will first be adjusted against the interest amount pending from the date of default and thereafter the rest would be adjusted against the pending principal amount.
The scheme’s provisions state that if there is surplus payment, it will be adjusted under different charges such as freehold charges, water and sewer charges, among others. But, if still some amount remains, it would not be refunded.
The provisions also state that a defaulter, who has sought rescheduling of payment or was ordered so through a government order, would only have to pay the original amount due.
The order states that applicants with up to ₹50 lakh pending in dues would have to pay a third of the sum within 30 days and the balance in three monthly instalments. Those with dues over ₹50 lakh would have to pay up a third of the amount within 30 days and the balance in three bi-monthly instalments.
The developers have welcomed the move saying that the scheme is reasonable and would benefit defaulters.
“The defaulters will not have to pay penal interest, which, over a period of time, adds a lot to the pending amount. Further, a couple of years ago the GDA had increased the rate of interest and asked developers to reschedule their payments, and many applied. Later, the authority decreased the rate but did not pass on the benefit to developers. So many went to court,” said Manoj Sharma, director of Vedantam Minaret at Indirapuram.
“The earlier OTS schemes had no facility to pay in instalments. Total payment had to be made in one month. With the new scheme, we have an option to pay in instalments. So, this scheme is generally beneficial and seems logical,” he said.
The authority has 62 major defaulters who were allotted commercial properties and another 4,000 allottees who got residential properties under different GDA schemes, officials said.
