REAL ESTATE UPDATE
26th May 2022
Issue No. 03/22-23
AMNESTY SCHEME | SLUM REDEVELOPMENT IN MUMBAI
In order to revive the stalled slum redevelopment projects, the State Government of Maharashtra issued a Government Resolution dated 25th March 2022 (“GR”) for implementation of the Amnesty Scheme thereby providing measures for reviving the stalled slum redevelopment projects in Mumbai. As per the housing department, there are about 380 slum rehabilitation projects stalled or turned dormant mainly due to financial, procedural and regulatory problems.
Following benefits and conditions have been provided under the GR:
- New developers will have to be appointed through tendering process for the slum redevelopment projects that are stalled due to non-appointment of developers or due lack of payment of rent to the slum dwellers. The approval of the general body of the committee of slum dwellers will not be needed for the appointment of new developers.
- The financial institutions (FIs) approved by the Reserve Bank of India (RBI) and the Securities Exchange Board of India (SEBI) would be allowed to complete rehabilitation projects.
- FIs that have already provided funds for the implementation of slum rehabilitation projects, will be notified as co-developers.
- RBI and SEBI-approved FIs will be exempted from the payment of 5 per cent premium.
- It will be mandatory for the developers/FIs to complete the rehabilitation portion under the Amnesty Scheme in a given time period. Besides, it will be compulsory for the new developers to regularly pay rent to slum dwellers.
- In the first year, the developers/FIs will have to complete 33% work and if delayed they will have to pay 1% of the land required for the construction of the saleable portion. They will have to complete 66% of the work in two years or pay a fine of 2% of the land required for the construction of the saleable portion. They will have to complete the scheme in three years or pay a fine of 2% of the land required for the construction of the saleable portion.
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