NOIDA: The Noida authority has decided to offer at least 30-40 per cent discount in interest that is piled up on the land cost dues earlier allotted to realtors, for industrial purpose, and other usages in the city, officials said on Sunday, the plan now awaits Uttar Pradesh government’s go ahead.
The move aims to recover the dues and also pave the way for registry in the housing projects facing default of payment that poses hurdle in execution of registry thereby affecting the interests of thousands of homebuyers, said officials.
Currently there are at least ₹40,000 crore financial dues to be recovered from different allottees including developers, industrial plot owners, commercial properties, and other land owners, said officials.
As per the rules, the Noida authority prior to 2017 allotted land for different uses including housing, hotel, and industrial purpose in instalments. The allottee used to pay 10 per cent at the time of allotment, and remaining land cost was to be paid in parts.
But many land allottees failed to pay the dues citing the financial crisis, loss in business and other grounds thereby causing huge loss to the Noida authority that allots the land, said officials.
In the past, for over 20 years or so the Noida authority couldn’t recover the dues, and it kept adding the compound interest on the original cost of the land due to the default, said they added.
Due to the compound interest and continuous default, the dues have become around ₹40,000 in all departments, said officials.
The defaulters are now finding it almost impossible to clear the dues (due to addition of compound interest). They want waivers on interest so that the long-standing financial issue can be resolved.
“If the Noida authority brings scheme and offers waivers on the interest component, this long-standing issue can be amicable resolved. And without rationalisation of the interest, every defaulter cannot clear the dues affecting the homebuyers in group housings. The best part will be that the government should offer waivers so that it can recover the dues, and also resolve registry issues benefiting the homebuyers, said Dinesh Gupta president of Western Uttar Pradesh chapter of confederation of real estate developers association of India (CREDAI) told HT.
In response to the demands raised by the developers on several occasions, including this March, the Noida authority prepared a scheme to offer cut on interest on dues.
On April 7, the authority approved the scheme during its board meeting. Now, in May it has sent the scheme to the Uttar Pradesh government for approval. Once approved the policy holds potential to resolve the financial dues issue to large extent, said officials.
“It is up to the state government to decide on this issue. If the state will approve the authority’s scheme, defaulters can get 30-40 per cent cut on interest that has gone up due to time,” Noida authority’s chief executive officer Krishna Karunesh told HT.
If the state government approves, the Noida authority can come up with a one-time settlement scheme under which it will offer waivers on interest and resolve multiple issues related with the financial dues, said officials.