Noida Authority Cracks Down on Defaulter Developers
The Noida Authority has discovered that approximately fifty real estate developers are delinquent on payments, resulting in an estimated loss of Rs. 3,000 crore to the government. This revelation has prompted the authority to consider significant changes to its existing payment scheme.
Many Builders are identified by Noida Authority as default payers.
The 10% Payment Scheme and Its Fallout
The current scheme, introduced by the BSP government in 2008, allowed developers to acquire land for "group housing" projects by paying just 10% of the total cost upfront. It aimed to transform Noida into a hub for affordable housing. However, this well-intentioned initiative has, unfortunately, backfired, with a significant number of developers failing to maintain their installment payments. The Noida Authority, along with the three Gautam Budh Nagar Authorities, are now contemplating amendments to this scheme, with potential changes expected to be discussed at their next board meeting.
Noida authority reveals that many builders do not pay the installments
Identifying the Defaulters and the Path Forward
The Noida Authority has pinpointed almost 50 developers, including several prominent and established companies, as defaulters. "The majority of the developers are violating the agreement as they are not paying the prescribed amount," stated GP Singh, finance controller of the Noida Authority. He elaborated that some of the industry's biggest names are on the defaulter list, furthering the authority's resolve to amend the existing scheme and ensure payment compliance.
Impact and Future Course of Action
The estimated loss to the Noida Authority is pegged at a staggering Rs. 3,000 crore. The 2008 scheme was originally designed to attract nationwide investment. Under the scheme's provisions, builders could lease land by paying an initial 10% and the rest in installments. Although intended to provide relief for smaller developers, the authority has found that numerous builders have not met their payment obligations for several years. In response, the Noida Authority has issued notices to some defaulters, with the stern warning of land seizure if these notices are ignored.