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SRA CIRCULAR ON ADVANCE TRANSIT RENT APPLICABLE TO ONGOING PROJECTS ALSO
However, there have been several instances in the past where the slum dwellers have been living in transit accommodation for years and the developers have stopped paying the rent for the same.
Over the years, the complaints regarding non-payment of rent have drastically increased.
Background
Keeping in view the increasing instances of defaults by developers, a Public Interest Litigation being PIL No. 109 of 2019 by Vijendra Kumar Rai against the State of Maharashtra [1] (“PIL”) was filed before the Hon’ble Bombay High Court for non-payment of transit rent to eligible slum dwellers. The PIL highlighted that the substantial dues had not been paid to the eligible slum dwellers by the respective developers.
The Hon’ble Bombay High Court vide its Order dated 19th July 2023 in the PIL took into consideration the difficulties faced by the slum dwellers due to non-payment of transit rent and considered it as a serious concern. The Hon’ble Court was of the opinion that if each slum dweller would need to resort to court process for non-payment of dues, it would give rise to substantial litigations. In view thereof, the Hon’ble Court issued various directions inter alia directing the Slum Rehabilitation Authority (“SRA”) to take proactive measures to ascertain whether transit rent is being paid to the slum dwellers.
Directions by the SRA
In pursuance of this order of the Hon’ble Bombay High Court, the SRA issued a Circular (“SRA Circular”) on 01st August 2023 with various directions as under:
Authors: Manisha Paranjape, Partner and Binkal Mehta, Associate
Footnotes [1] Public Interest Litigation 109 of 2019
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- The developer shall deposit advance rent of two years and a post-dated cheque for the remaining period of completion at the stage of Annexure III and the Letter of Intent in favor of the Developer shall be issued only pursuant to depositing the advance rent.
- No new proposals of defaulting developer/firms and its partners/directors to be accepted unless all dues are cleared in respect of payment of transit rent.
- The defaulting developer/firm and its partners/directors shall not be entitled to be appointed as developers irrespective of the consent of society, in the existing SRA proposals wherein the previous developers are terminated.
- The developers of the Slum Rehabilitation Scheme who have failed to handover the PAP/PTC tenements to the SRA shall not be entitled to submit any new proposal.
Authors: Manisha Paranjape, Partner and Binkal Mehta, Associate
Footnotes [1] Public Interest Litigation 109 of 2019