Lavasa homebuyers to get properties in 5 yrs if they pay future construction cost

The NCLT on Friday approved a revised and improved resolution plan of ₹1,814 crore submitted by Darwin Platform Group of Companies for the revival of Lavasa hill city in Pune district

Homebuyers at Lavasa hill city are likely to get their incomplete properties ready within next five years after paying future construction cost, according to the Darwin Platform Infrastructure Limited’s (DPIL) resolution plan approved by the National Company Law Tribunal (NCLT). The NCLT on Friday approved a revised and improved resolution plan of ₹1,814 crore submitted by Darwin Platform Group of Companies for the revival of Lavasa hill city in Pune district.

The DPIL has proposed that it shall constitute a “Construction Cost Determination Committee” of four members consisting of equal representation of homebuyer representatives and RA’s management team, which shall estimate and approve the actual costs to be incurred for the construction and apportionment of such costs to individual homebuyers. (HT FILE PHOTO)

The resolution plan envisages the delivery of fully-constructed properties to the financial creditors (homebuyers) within five years from the receipt of the environmental clearance on an actual cost basis, according to the order by two-member NCLT’s Mumbai bench comprising Kuldeep Kumar Kareer (judicial member) and Shyam Babu Gautam (technical member).

Owners of incomplete properties have to pay actual future construction cost to DPIL to get possession of constructed houses. “It is proposed that the homebuyers shall pay actual future construction costs to the resolution applicant (RA) towards obtaining constructed properties in the project,” the order stated.

Apart from proposing actual delivery of constructed apartments, the resolution plan also has provided the homebuyers with the following two exit alternatives. The first exit clause is for homebuyers who do not wish to continue and wait for delivery for fully-constructed property as proposed, the RP envisages a full and final settlement by payment of 40% of their entire admitted claims within 24 months of the receipt of the Environment Clearence for first phase.

The second exit clause is self-construction where resolution plan stipulates that within the contours and permissibility of such activity as per applicable laws, there is option to homebuyers to undertake self-construction of their properties, entirely at their own responsibility, including accountability, costs and expenses. Further, for homebuyers who have terminated contracts under Real Estate Regulatory Authority RERA (cumulating to ₹9.33 crore), the RP proposes a resolution of the amount ordered by the Maharashtra RERA under individual cases by way of payment of ₹4.037 crore within 24 months from the effective date.

“Two of my studios are incomplete and I had invested about ₹35 lakh in 2010 when I booked it. Darwin has given us the offer that 40% of the invested money if we intend to sell the property then and there itself. We will negotiate and the company is open for talks. We are quite positive about the NCLT order as it would bring the long-desired change and transformation of Lavasa,” said investor Suresh Goswami.

Vineet Tulsyan of R-3 Corporate Advisors which guided Darwin Group in winning the bid said, “The NCLT decision has come after a long time and now the company will focus on strengthening the city infrastructure and ensure its successful revival. A detailed financial plan has been given to the NCLT which has been reflected in the order.”

The DPIL has proposed that it shall constitute a “Construction Cost Determination Committee” of four members consisting of equal representation of homebuyer representatives and RA’s management team, which shall estimate and approve the actual costs to be incurred for the construction and apportionment of such costs to individual homebuyers.

Of the ₹1,814-crore resolution plan of DPIL approved by NCLT, ₹1,466.50 crore to be paid cum discharged from funds infused over multiple tranches into the corporate debtor by way of cash funding and instruments, being equity, project inflows, loans, advances or a combination thereof.

These amounts shall be utilised for mandatory payments under the code, payments proposed to be made to certain creditors, including operational creditors and the secured financial creditors of the corporate debtors, and meeting the working capital and expenditure requirements.

Besides pledging the investment, the approved resolution envisages delivery of fully constructed properties to homebuyers within five years at the actual cost basis. DPIL has also planned to retain the previous manpower and pledged an amount of ₹22.50 crore for city maintenance and ₹70 crore for repairs and infrastructure upgradation.

Another homebuyer requesting anonymity said, “Things have moved after several years. However, it is still a long wait for homebuyers as they will get possession of their property after five years of environment clearance.”