NOIDA: The Allahabad high court has allowed a ‘zero period’ waiver for a developer of a commercial plot because of the Noida Authority’s failure to construct approach roads for around a decade.
The court, however, clarified that the decision was specific to the project because of the “peculiar circumstances” around it and should not be considered a general precedent.
The HC was hearing a bunch of petitions filed by Sunshine Trade Tower Pvt Ltd, the developer.
“It is evident that in the instant matter there was an encroachment on the road, which prevented the development from proceeding. Accordingly, the petitioner’s case falls under the ‘zero period’ policy of the Noida Authority for the grant of ‘zero period,’ and the benefit of ‘zero period’ cannot be denied to the petitioner. Therefore, we direct the Noida Authority to accord the benefit of ‘zero period’ to the petitioners in accordance with the order passed in June 2016,” read the July 19 order by the division bench of Justices Mahesh Chandra Tripathi and Anish Kumar Gupta.
The HC asked the Authority to recalculate in two weeks the dues that Sunshine has to pay after taking into account the waiver and approve the developer’s revised plan for the project after it has made the payment “The petitioner shall then pay the balance amount as per the demand within the next eight weeks from the date of receipt of the demand. Thereafter, the Noida Authority shall approve the revised plan in accordance with the law, subject to compliance with other formalities by the petitioners, within the next four weeks,” the order read.
The case dates back to 2011, when the Authority launched a scheme for allotting commercial plots. Sunshine was allotted 10,201sqm in Sector 94 for a total price of Rs 133.9 crore. A lease deed was executed in Jan 2012, and the developer made an advance payment of Rs 39.4 crore.
The plan sanctioned by the Authority included two approach roads to the plot. While a 45m wide road was to lead to the plot from the north, another 24m path was likely to be laid from the east.
The developer alleged in its petition that while the 45m road was encroached by villagers, the other was just a dirt track filled with sand and potholes.
Despite the lack of roads, Sunshine started developing the plot, but suffered another setback in 2013 when the National Green Tribunal (NGT) announced a ban on all construction within 10km of the Okhla Bird Sanctuary. The ban continued till 2015, when the Centre allowed constructions beyond 100m of the sanctuary.
The work, however, was hit hard by the lack of approach roads.
Subsequently, when the Authority announced ‘zero period’ benefits for projects delayed by the NGT ban or lack of amenities like roads, Sunshine approached officials with a plea to grant it a waiver. Although the company was allowed relief for the NGT ban, the approach roads were still not constructed.
In 2017, Sunshine filed its first petition in the HC, seeking the construction of roads at the earliest. The court asked the Authority CEO to decide on the representation, based on its ‘zero period’ policy, in three months.
In 2020, the 24m wide road was eventually laid, but the other one was still in the works.
The Authority, however, cancelled Sunshine’s lease deed on June 14, 2022, over mounting dues.
But by then — between 2019 and 2024 — the developer had filed several petitions in the HC against the Authority’s decision to not allow any waivers and cancel its lease deed.
On April 10, 2023, the HC asked the Authority to process Sunshine’s revised map without insisting on time extension charges, but a final decision was awaited on the premium and interest amounts.
The Authority, however, issued a demand notice on May 19 that year, asking the developer to deposit a significant amount for the revised plan’s approval. It raised other objections too through two notices on June 1 last year and Feb 23, 2024. Noida wanted Sunshine to pay the balance principal, which was challenged by the developer in court.
On July 19, the division bench ruled that Noida’s delays could not be blamed on the developer. It said since the lease deed had been executed, the company had the “legitimate expectation” of a proper road access, without which construction could not proceed.
