MUMBAI – The Maharashtra state government has announced a major crackdown on real estate developers who have failed to pay compensation and refunds to homebuyers. In a recent update shared in the state assembly, officials revealed that the current recovery rate for these dues sits at just 34%, sparking a new wave of strict enforcement actions.
For many years, homebuyers who faced project delays or fraud turned to the Real Estate Regulatory Authority (RERA) for help. While many won their cases, actually getting the money back from developers has proven to be a difficult and slow process. This new government directive aims to bridge that gap and ensure that legal wins turn into actual bank balances for families.
The reality of the numbers
According to recent reports, out of nearly ₹792 crore in penalties and compensation ordered by the regulatory body, only about ₹279 crore has been successfully collected and returned to the rightful owners. A significant portion of the remaining money is stuck because some building companies have entered bankruptcy, while others have simply avoided payment.
Lawmakers have raised concerns that if the law isn’t enforced strictly, the trust of the common man in the real estate sector will continue to fade. In some instances, families have waited nearly a year just to get a court order, only to find that the developer still refuses to pay months later.
New powers for local authorities
To solve this, the state has ordered District Collectors, the local officials responsible for tax and debt collection, to take direct action. They have been given the green light to identify and “attach” (seize) the properties of defaulting builders.
Once a property is seized, the government can auction it off to recover the money owed to the homebuyers. Interestingly, the government has told officials they can look for a builder’s assets anywhere in the state. If a builder owes money for a project in Mumbai but owns land in another city, that land can now be seized to pay off the debt.
A collaborative effort
The recovery drive will not just rely on land records. Authorities are now working across different departments, including the tax office and the registration department, to find hidden assets belonging to developers who claim they have no money left.
Regular review meetings will now be held at high levels of the state government to track progress in regions like Mumbai, Thane, and Palghar, where the number of pending cases is the highest.
What this means for homebuyers
This news brings a glimmer of hope to thousands of people who have invested their life savings into stalled housing projects. By shifting the focus from just “passing orders” to “enforcing payments,” the state hopes to send a clear message: developers must fulfill their financial obligations or risk losing their own assets.
Also read – The new engine: How logistics is reshaping Indian real estate
Disclaimer – This article provides general information regarding real estate recovery news and is not legal or financial advice. Readers should consult a legal professional for specific cases regarding property disputes.
Source – Times of India
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