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Introduction:

The interplay between writ jurisdiction of high courts and private contracts involving the State or the instrumentalities of the State becomes complex when a party to the contract seeks a contractual relief from the high courts by way of a writ petition. The nuances are further enhanced based on the specific facts and circumstances of the case, the nature of parties involved, the nature of rights and obligations involved, and so on.…

Continue Reading Can Article 226 be Invoked to Amend Terms of a Lease Deed? SC Says No!

In a ruling likely to offer significant relief to landowners and real estate developers in Maharashtra, the Hon’ble Bombay High Court (“BHC”) in the matter of Salim Alimahomed Porbanderwalla and Anr (“Petitioners”) vs. The State of Maharashtra and Anr.[1] (“Respondent”), has vide its order dated March 30, 2023, ruled that the Government of Maharashtra (“GOM”) cannot charge a premium or make any entry in revenue records [to the effect that the land is affected by the Exemption Order passed under Section 20 of the Urban Land (Ceiling and Regulation) Act, 1976 (since repealed) (“ULC Act“), and transfer prohibited without prior permission]  vis-a-vis land retainable under the ULC Act (i.e. the land which is not a surplus vacant land).…

Continue Reading ULC premium applicable solely on surplus vacant land: Bombay High Court

Insolvency & Bankruptcy Code

Over the last few years, several cases of defaulting real estate companies, including major players like, Amrapali, Jaypee Infratech and Supertech, have been stuck at various stages of insolvency proceedings under the provisions of the Insolvency and Bankruptcy Code, 2016, as amended (“Code”). As per the data provided by Insolvency and Bankruptcy Board of India (“IBBI”), a total of 344 corporate debtors engaged in construction and real estate activities have been admitted into corporate insolvency resolution process (“CIRP”) as of September 2022.[i]…

Continue Reading Proposed Amendments to the Insolvency and Bankruptcy Code- A Real Solution For Real Estate Insolvencies?

Unending woes of realty sector - High Interest Rates

The real estate sector in the past few years has witnessed massive financial crisis with several real estate companies going bankrupt and many others undergoing corporate insolvency resolution process. While the reasons are manifold, one could see steady recovery despite inflation worries and expensive capital. The recent Supreme Court judgment in recalling its past orders delivered in the matter, relating to insolvency of Amrapali Group of Companies (“Amrapali Group”), have now posed a new challenge to the realty business in NOIDA and Greater NOIDA region. The Supreme Court has held that real estate developers in these regions will have to pay interest amount on outstanding lease premium and other dues to Noida and Greater Noida Authorities (“Authorities”) at rates that have been agreed upon under the contract entered into between them and the reduced interest rates will not be applicable to them. …
Continue Reading Unending woes of realty: ‘high interest rates on dues continue to apply’, says SC

A Notice in Time Saves Nine

The right to receive notice and an opportunity to be heard are considered as twin ingredients of natural justice, unless specifically excluded by legislation. There are certain laws in India that warrant strict compliance with this requirement. The courts in India have also examined this requirement and its consequences, while keeping in mind the extent to which this requirement is needed to be met with.…

Continue Reading A Notice in Time Saves Nine

REIT

The Securities and Exchange Board of India (SEBI) issued a circular in April this year (Circular), reducing timelines for REIT listings from 12 working days to six working days from the date of public issue closure. While this is a welcome move from the perspective of public investors and is yet another step towards ensuring parity between REIT and listco regimes, this could prove challenging for REITs and their advisors, given the intricacies of the REIT regulatory framework.…

Continue Reading Reduction in REIT Listing Timelines – A Sprint to the Finish Line?

Consent Requirements for Land Conversion and Intended Usage – Regime in Karnataka
In the recent years, there is an interpretational query in scenarios wherein the jurisdictional Deputy Commissioner has originally accorded conversion under Section 95 of the Karnataka Land Revenue Act, 1964 (“KLR Act”) for a land use now inconsistent with the zoning of the land as earmarked under the Revised Master Plan 2015 (“RMP 2015”). Given the scenario, should the landowner now obtain a change of purpose order as mandated under Section 97 of the KLR Act in relation to the usage of such lands for purposes other than for the purpose for which permission was accorded in terms of Section 95 of the KLR Act?
Continue Reading Consent Requirements for Land Conversion and Intended Usage – Regime in Karnataka

Relief to Affected Home Buyers For Delay In Possession

Delays in handing over the possession of flats has become a rampant practice in the Indian real estate industry, due to which numerous innocent home buyers are being penalised. With developers indulging in the delay tactics in handing over possession of flats, home buyers are not only left in the lurch, but are also being forced to pay ‘equated monthly instalments’ (“EMIs”) on home loans.  However, over the years various forums have come to the rescue of the flat buyers.…

Continue Reading Relief to Affected Home Buyers For Delay In Possession

NOIDA stands in the shoes of an operational creditor

Introduction

The resolution process for real estate companies is anything but simple, given the complexities involved and the plethora of parties with varied and conflicting interests. One such issue was whether local industrial development authorities, in particular the New Okhla Industrial Development Authority (“NOIDA”), should be classified as financial creditors or operational creditors, by virtue of the lease deeds they enter into with various corporate debtors.

The question has now finally been answered. The Hon’ble Supreme Court of India vide its judgment dated May 17, 2022, in the case of New Okhla Industrial Development Authority v. Anand Sonbhadra[1], has now declared that NOIDA is not a financial creditor and would be classified as an operational creditor under the Insolvency and Bankruptcy Code, 2016 (the “Code”). The issue involved in the Anand Sonbhadra (supra.) judgment was whether 90 year leases entered into between NOIDA and real estate companies give rise to a financial or operational debt in the event that corporate insolvency resolution proceedings are initiated against such real estate companies.…

Continue Reading NOIDA stands in the shoes of an operational creditor

No Occupancy Certificate No Maintenance Charges

An Occupancy Certificate (“OC”) is a document that is issued by a local government agency or planning authority, upon completion of construction of a new project. The certificate is proof that the project has been built, by adhering to applicable building codes, relevant regulations, and laws. It is the responsibility of the developer to obtain an occupancy certificate once the project has been completed. The certificate is an indication that the building is suitable for occupancy.…

Continue Reading No Occupancy Certificate: No Maintenance Charges