What are Rehabilitation Scheme for Stalled Projects under UP RERA


Status as on- 28/09/2020

The UP-RERA acted as a facilitator between the association of allottees [“AoA“] and the Jaiprakash Associates Ltd [“Promoter”] to complete the stalled project titled Jaypee Kalypso Court” (Phase II) [“Project”]. In this case, the Promoter failed to complete the project as per the terms and conditions of the builder buyers’ agreement and delayed the delivery of possession of the flats by two years.

Thereafter, an aggrieved association of allottees/society registered under the Societies Registration Act which had a membership of 152 members of the Project approached the UP-RERA Authority with a request to facilitate the remaining development and construction work of the project so that the allottees would get the possession of their allotted units.

Usually, the Authority under RERA orders refund of the money deposited by the allottee. However, this time, instead of ordering a refund/recovery certificate, ordered rehabilitation of the Project. The UP-RERA with a view to facilitate the completion of the project in a time bound manner and to protect the interests of the allottees, used its powers under Section 8 (read with Section 37) of the Act to direct the promoters of the company to undertake the completion of the remaining development and the construction work of the project. The aforementioned was one of a kind orders that transformed a stalled project into a Rehabilitation project under Section 8 of the RERA.

The UP-RERA, allowed the promoters to complete the project with the following conditions:-

  • The AoA has to submit the consent of more than 50% of the allottees of the unconstructed flats.
  • The promoter was required to submit a notarized affidavit swearing to complete the project within 18 months
  • The Authority will monitor the progress of project under the chairmanship of hon’ble member of the UP-RERA and will be reviewed on a quarterly basis.
  • The promoter was required to deposit 12 Cr Rupees before becoming entitled to any receivable from the allottees.
  • The promoter was required get the account of the project audited separately at the end of the financial year and annual audit report is to be uploaded on the website of the Authority.

The promoter is required to deposit all its contribution towards the project, as agreed with the AoA in a separate account and the same is required to be utilized only for the work relating to the construction, development and completion of the Project.

The AoA, the promoter, the allottees and all others connected with the development and completion of the Project are bound by the Rehabilitation order passed by the UP-RERA.


It may be noted that the UP-RERA merely acted as a facilitator between the allottees and promoters for the Project. No penalty has been imposed nor any stringent action has been taken against the Promoters. It is also interesting to note that the UP-RERA did not prescribe any defaulting penalty in case the promoter again fails to abide by the terms of the Rehabilitation.

Disclaimer – The article is based on the personal interpretation of the related laws and judicial pronouncements, which may change from person to person. The readers are expected to take legal advice before placing reliance on this advice. For more information or clarification, please write back at support@centrik.in

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