Gujarat Model: A Blueprint for Effective Recovery of Dues in Real Estate Sector
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In recent times, the Real Estate Regulatory Authorities (RERA) across various states have been grappling with the challenge of builders failing to comply with their orders, leaving homebuyers in a state of distress. In response to this pressing issue, the Ministry of Housing has stepped in, advocating for the adoption of the “Gujarat model” as a solution to streamline the recovery process and ensure justice for aggrieved parties.

The Gujarat Rera stands out for its proactive approach towards enforcement, having implemented a robust recovery mechanism that has yielded tangible results. Central to this model are the appointments of dedicated officers vested with comprehensive powers for the execution of recovery warrant orders. These officers play a pivotal role in enforcing compliance by builders, ensuring that they adhere to the directives issued by the regulatory authority.

Moreover, Gujarat Rera has instituted detailed execution proceedings, including provisions for arrest and detention, to compel errant developers to fulfill their obligations. In cases of non-compliance, the authority has not hesitated to initiate suo moto proceedings for the attachment of properties, thereby compelling promoters to settle dues along with accrued interest.

Recognizing the efficacy of the Gujarat model, the Ministry of Housing has urged state governments to emulate this approach and designate additional district magistrates or collectors as “revenue recovery officers.” These officers would be entrusted with the responsibility of enforcing recovery warrants, particularly in districts with a high backlog of cases.

The move has been met with approval from stakeholders, including the Forum for People’s Collective Efforts (FPCE), a prominent homebuyers group. FPCE emphasizes the urgent need for regulatory authorities to enforce their orders effectively, providing much-needed relief to homebuyers who have been embroiled in legal battles for refunds.

In a recent meeting chaired by Union housing secretary Manoj Joshi, the Ministry highlighted the success stories of Reras such as Uttar Pradesh, where over Rs 800 crore has been recovered through 4,000 recovery certificates. Moreover, there have been discussions on introducing provisions akin to those in income tax laws, holding directors personally accountable for dues if recoveries from company assets prove inadequate.

In conclusion, the Gujarat model serves as a beacon of hope for the real estate sector, offering a pragmatic approach to address the persistent issue of non-compliance by builders. By adopting similar strategies nationwide, Reras can uphold transparency, accountability, and justice, thereby restoring faith in the real estate ecosystem.

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