KOCHI: The Kerala Real Estate Regulatory Authority (RERA) has pulled up Union Bank of India for its decision to auction the stalled ‘Dewa Pier - 20’ luxury apartment project at Marine Drive, Kochi, without having any consideration to the homebuyers, who have booked flats in the multi-crore project but not been repaid a single paisa yet.
The RERA, in its order, also asked the Union Bank of India to register the project with the real estate regulator by November 20, pointing out that it cannot sell or invite persons to purchase the property without registering the real estate regulator. Further, the RERA order said: “At the time of transferring the project to a third party, the respondent (Union Bank of India) shall take prior permission from the authority.”
In violation of the RERA order, Union Bank of India went ahead and auctioned the property, ignoring the pleas of homebuyers. Sources said the Union Bank of India put the property for auction for a minimum bid amount of Rs 150 crore, and it was sold at Rs 150.1 crore. When contacted, R Girish, chief general manager, of Union Bank of India, confirmed that the final piece of land was sold to an “individual” but he did not reveal the name of the buyer.
The Dewa project, which raised money from homebuyers back in 2005-06, promised 605-odd apartments in a 7-tower project overlooking the backwaters at Marine Drive on a 6.32-acre plot. The trouble started after the promoter K Venugopalan Nair, a Kuwait-based entrepreneur, defaulted on a Rs 600 crore loan.
The 13-bank consortium led by Union Bank of India had earlier auctioned two plots of Dewa Projects -- 4.8 acres to MA Yusuffali of Lulu Group and another 11.9 acres by Puravankara Projects. But, the last piece of 6.32-acre land was embroiled in a legal battle as it involved the stakes of home buyers.
“The respondent (Union Bank of India) shall make full and complete disclosure of all outstanding liabilities with respect to the project in its auction notice,” the RERA order said.
However, Girish questioned RERA’s authority over the Dewa project as it came way before the real estate regulator came into being. This argument was contested by the Dewa Investors’ Association. “The RERA Act came into force on May 1, 2016, and it says that any project that is not completed before May 1, 2017, comes under RERA. The project is not completed even today,” pointed out Prince Joseph, president of Dewa Investors’ Association.
Meanwhile, Vinod P V, the liquidator of the Dewa Projects, said Union Bank of India has not been disclosing the details on the auction of the property, and who the buyer is. “This is a public sector bank, and the project involves stakes of several home buyers. Union Bank of India has to disclose the identity of the buyer,” said Vinod, whose repeated enquiries to know the status of the auction have been met with a rebuff by the Union Bank of India.
RERA has posted the case for December end, and homebuyers are hopeful that their claims will be settled by the Union Bank of India by then.