The Maharashtra Real Estate Regulatory Authority (“Authority”) on December 27, 2022 issued order no. 40/2022 (No. MahaRERA / Secy / File no.27/853/2022) (“Notification”). The Notification lays down new directions which are required to be followed by the promoters of a real estate project who have failed to complete the project within the stipulated timeline and are now seeking an extension of validity of a project registration under section 7(3) of the Real Estate (Regulation and Development) Act, 2016 (“RERA”). The key highlights of the Notification are as follows: 

1. Extension of validity of a project registration would be granted upon the promoters complying with the directions issued under order no. 7 of 2019 dated February 8, 2019 (“2019 Order”). As per the 2019 Order, in cases where the promoter of a project registered with the Authority is unable to complete the project in the extended time of 1 (one) year granted under section 6 of RERA, “further extension may be given only in those cases where the concerned association of allottees resolve that instead of revoking the registration, the existing promoter be permitted to complete the project in a specific time period”. For the purposes of the 2019 Order, the association of allottees shall be “the association or society or cooperative society or a federation or any other body by whatever name called, consisting of a majority of allottees who have booked their plot or apartment or building, as the case may be, in the project.”

2. If the promoters are unable to comply with (1) above, then the promoters shall have the option to follow the procedure below: 

• Promoters shall submit the consents as obtained from the allottees irrespective of the number of such consents along with reasons why the required percentage of consents from allottees could not be obtained and why the application for extension should be considered without the required 51% (fifty one percent) consent.
• Promoters shall submit an explanatory note along with supporting documents setting out: (i) the reasons for delay in completion of the real estate project; (ii) the need for grant of extension; and (iii) the steps that would be taken by the promoters to complete the project within the extended period sought.

3. Application for extension of validity shall be made in Form 'E' along with the prescribed fees as provided in Rule 7(3) of the Maharashtra Real Estate (Regulation and Development) (Registration of Real Estate Projects, Registration of Real Estate Agents, Rates of Interest and Disclosures on Website) Rules, 2017.
4. Consents of allottees shall be provided in Format 'B' as provided in circular no. 28 of 2021 dated March 8,2021.
5. The grant of extension of the project validity shall not affect/jeopardize the rights accrued in favor of the allottees who have booked their plot, or unit or apartment or building in the real estate project.
6. The Notification shall be read along with the 2019 Order.

Please find a copy of the Notification and the 2019 Order, here and here, respectively.

This update has been contributed by Nidhi Arya (Partner) and Ayushi Jain (Associate).

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