In a rare move, the Karnataka Real Estate Regulatory Authority (KRERA) has directed an association of flat buyers to take charge of a project that faced delays and ensure its completion, after the developer failed to deliver the apartments on time.
The regulator found that developer Commune Properties Pvt Ltd. and financier Anand Rathi Global Finance Ltd. violated its directives, leading to the decision. KRERA ordered Anand Rathi to transfer Rs 4.3 crore collected from the sale of mortgaged apartments to the association to aid in completing the project, as per its May 17 order.
The Commune One project, situated in Anekal taluk in the southern part of the Bangalore metropolitan area, was scheduled for completion by December 2019. However, KRERA noted that only partial completion was achieved, with around 200 flats handed over without amenities or occupancy certificates out of the 384 planned across five towers.
The association alleged that the entire project was mortgaged with Anand Rathi in 2017 without the consent of homebuyers, and funds raised from the mortgage were misused.
KRERA directed the association to take over the project and complete it within two years, as per Section 8 of the RERA Act. Anand Rathi was instructed to transfer the Rs 4.3 crore collected from the sale of 18 apartments to the association for this purpose.
The regulator also permitted the association to sell unallocated apartments to raise additional funds. Additionally, the developer’s existing account will be frozen, and the maintenance corpus collected from homebuyers will be transferred to the housing association, as per the order.
