‘Civic body yet to recover 656 cr from developers’

Mumbai: From purchasing health machinery at higher cost to underbidding in civic tenders, financial malpractices seem to have taken precedence in civic corridors. Following a point of order raised by senior Congress leader Mohsin Haider, the civic administration on Monday said it is yet to recover premium dues worth Rs 656 crore from 45 developers who redeveloped properties on BMC land in the island city since 1996. Corporators have slammed the civic administration for causing such a huge loss to the civic exchequer. 

    According to the civic administration, the 45 developers who have defaulted were last sent a notice in January. The developers have the choice of handing over the flat or pay a premium to the corporation. "We are taking this seriously. Of the 45 developers, 21 have responded to the notices and their cases are being heard. The recovery of dues will soon be made. Action will be taken against those developers who fail to respond to the notice," said Milind Sawant, deputy municipal commissioner. 
    In the improvements committee meeting held in April, Haidar had raised a point of order regarding the recovery of premium dues from builders for redevelopment projects as per sections 33 (7) and 33 (9) of Development Control Rules, 1991. 
    As per the DCR, the developer is supposed to cough up 10% of the premium amount at the time of issuance of letter of intent, while the remaining 90% is supposed to be paid before procuring occupancy certificate from BMC. "In most cases, the developer never comes to the BMC for seeking the occupancy certificate (OC). The flats are sold much before that and once the new occupants enter the flat, the BMC will turn up to check the OC. The developers in this case go scot-free without paying the corporation the premium," said Haidar. 
    The defaulting amount is excluding the interest rate which is imposed by the civic body. "If the interest rate is added then this figure would rise beyond imagination. The civic body should take the developers and architects involved to task. Once the projects are completed, the developers dissolve their existing companies and float new companies. Meanwhile, the civic body keeps waiting for the company to turn up for the OC," Haidar said. 
    Dr Ram Barot, improvements committee chairman, said, "It is a huge loss to the civic exchequer and strong action should be taken. The civic administration hasn't been serious about this issue. If the developers do not respond to the notice sent by the civic body, then they should be blacklisted."