MUMBAI: Hundreds of buyers of flats in the Orbit Corporation’s budget housing project in Andheri, who were hoping that the project stalled since 2013 would take off after the developer settles the debts, have been disappointed once again.
The project has hit another roadblock with the ready reckoner rate (RRR) of one of the two plots being pushed up by 136 per cent from the original rates “completely jeopardising the viability of the project.”
With a changed sub-division number, Orbit Residency Park’s RRR for one of the two plots, which was earlier Rs 38,100 for every square metre, has now been jacked up to Rs 89,770 for the financial year 2020-21. The second plot’s RRR continues to remain consistent at Rs 38,100.
The project comprises six towers with 281 residential units and six commercial units.
The project is currently under an Interim Resolution Professional (IRP) appointed by the National Company Law Tribunal (NCLT) after Ahinsa Buildtech Pvt Ltd, a subsidiary of Orbit Corp that has undertaken the project, was dragged to the law tribunal by one of its creditors. As per procedure, the IRP had invited applications for a resolution plan, through which the project would be completed.
This resolution plan, flat buyers say, is the only hope that one day they would be living in the houses they purchased 10 years ago.
The flat buyers under the umbrella unit of Orbit Residency Park CHS were one of the six entities to submit their applications showing interest in completing the project. However, with the hiked up RRR, they say, the project is no more viable.
Not only the home buyers, the resolution professional, Vivek Lulla, has also written to the Collector of Stamps and IGR Registration asking them to restore the RRR to what it originally was.
Explaining the impact the changed RRR will have, Sarju Saini, who leads the flat purchasers’ group, said that fresh approvals will be required from the BMC and certain premiums will have to be paid which are all linked to the RRR. Moreover, the sale agreements for many flat buyers couldn’t be registered, and now they will be charged stamp duty at these new rates.
“The people who have booked their flats are from middle class backgrounds, and they invested their life’s savings in this project 10 years ago. The flat buyers have already suffered huge financial losses and mental agony due to delays in the project. This project was supposed to have been completed in 2014, and the flat owners have, so far, collectively paid Rs 155 crore towards their instalments. The only hope they now have is that the resolution process is initiated under NCLT,” the resolution professional said in the letter.
In 2009, Pujit Aggarwal, promoter of Orbit Corporation, started accepting bookings for several projects in the city, some of which were SRA projects, some redevelopment projects, and some new constructions like the one in Saki Naka, promising flats by 2013. For this, Aggarwal took loans from several banks and non-banking institutions.
He took a loan of Rs 325 crore from LIC Housing Finance Limited for three projects – Orbit Residency, Orbit Grand, a luxurious redevelopment project in Lower Parel and for another project in Lalbaug.
The promoter also used these projects as security against his loans.
However, by 2015, after making part payment, Aggarwal had defaulted on most of his loans. Flat buyers of Orbit Residency Park, in Saki Naka, had approached the High Court, willing to buy back their project but were directed to NCLT after the sister company’s insolvency proceedings.