Wel­fare or un­fair?

HT Estates - - HTES­TATES -

re­tain 40% land and re­turn 60% to the landown­ers. To com­pen­sate landown­ers for loss of land, DDA will award them higher floor area ra­tio (FAR), which will al­low them to con­struct more apart­ments in projects on their land and sell the same for a profit.

Land at present in the afore­men­tioned ar­eas is owned by farm­ers and de­vel­op­ers. Of late, wel­fare so­ci­eties have started buy­ing the prop­er­ties from farm­ers in an­tic­i­pa­tion of the pol­icy be­ing im­ple­mented.

The chal­lenge is that till now DDA has only pre­pared the draft reg­u­la­tion of the pol­icy and it is yet to be no­ti­fied. Real es­tate ex­perts say it is too early to say which sec­tor of a par­tic­u­lar zone will come un­der the pol­icy as DDA will not con­sider ar­eas not con­form­ing to the terms and con­di­tions of the pol­icy ( see DDA’s VC in­ter­view).

Can peo­ple be duped?

Le­gal ex­perts, real­tors, ur­ban de­vel­op­ment ex­perts and rev­enue of­fi­cials are of the view that when a pol­icy is un­der re­view, set­ting up a wel­fare so­ci­ety and col­lect­ing money for it is il­le­gal.

“Ear­lier, peo­ple used to come to­gether to form a co-op­er­a­tive group hous­ing so­ci­ety (CGHS) and ap­ply to DDA for land at con­ces­sional prices to build apart­ments for its mem­bers. How­ever, since 1990, regis­tra­tion of CGHS is on hold in Delhi and peo­ple have started form­ing wel­fare so­ci­eties un­der the So­ci­ety Regis­tra­tion Act for the same pur­pose. This is il­le­gal in my view be­cause such wel­fare so­ci­eties are ba­si­cally NGOs which, in­stead of do­ing work­ing for the wel­fare of the so­ci­ety, are in­dulging in eco­nomic ac­tiv­i­ties,” says a real es­tate de­vel­oper in Dwarka.

Jas­bir Mal­lik, a Supreme Court lawyer, agrees. “First of all, when the draft reg­u­la­tion of the land pool­ing pol­icy is not fi­nal, any fundrais­ing ac­tiv­ity un­der the said pol­icy by any group, so­ci­ety or de­vel­oper is il­le­gal. Se­condly, wel­fare so­ci­eties can­not en­croach upon the func­tions of CGHS un­der the garb of wel­fare ac­tiv­i­ties. Law en­forc­ing agen­cies should ini­ti­ate ap­pro­pri­ate ac­tion be­fore in­no­cent peo­ple be­come vic­tims of fraud.”

Se­nior DDA of­fi­cials say such ac­tiv­i­ties can lead to too many dis­putes and frauds. “Th­ese wel­fare so­ci­eties can eas­ily run away with the home­buy­ers’ money. They are promis­ing the moon but in re­al­ity in­vestors may end up get­ting noth­ing. All are promis­ing ex­pected con­struc­tion years as 2017 and 2018 but no one can say for sure when the pol­icy will take fi­nal shape and be im­ple­mented,” says a le­gal of­fi­cial from DDA. Some wel­fare so­ci­eties have now con­verted to multi-state co­op­er­a­tive so­ci­eties to le­galise their ac­tiv­i­ties.

De­vel­op­ers, too, sell­ing dreams

Be­sides wel­fare so­ci­eties, some real es­tate com­pa­nies have also launched their projects in the afore­men­tioned zones, col­lect­ing 25% of the pro­posed cost of the flat as book­ing amount. Th­ese de­vel­op­ers are promis­ing 2 BHK in the range of R40 to ₹ 60 lakh.

Deepak Gupta, ex­ec­u­tive di­rec­tor, Kamp De­vel­oper, says they have launched the first phase of a project in L Zone in Dwarka and sold 60% of the apart­ments at the rate of ₹ 4500 per sq ft. “You have to pay 10% of the book­ing amount and 15% af­ter 90 days of the book­ing. Out of 485 flats, we have al­ready sold 285 flats for which peo­ple have al­ready paid 25%. Noth­ing is avail­able be­low the sev­enth or eighth floors. Home­buy­ers don’t need to worry as ev­ery­thing is le­gal,” he adds.

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