NOIDA: The Allahabad High Court has overturned a state government order that withdrew a lease rent waiver granted to a realtor under the “zero period” policy.
On October 8, Justice Subhash Vidyarthi from the Lucknow bench invalidated the January 9, 2024 directive from the Infrastructure and Industrial Development Commissioner (IIDC). This directive had rescinded the lease rent waiver initially granted to Express Builders and Promoters.
This ruling follows two previous decisions where the high court also set aside the same January 2024 order concerning Great Value Projects India (April 23) and Pan Realtors Pvt Ltd (May 29). The court noted that the issues in the current case were identical to those already decided, justifying the same outcome for Express Builders. It directed the Noida Authority to recalculate the developer’s dues based on the status before the disputed order and to address any outstanding grievances.
The case revolves around the “zero period” policy, which provides developers with rent relief during construction halts due to reasons outside their control, such as court-ordered stays or regulatory delays. In mid-2023, the state’s revisional authority had granted similar waivers to Great Value Projects, Pan Realtors, and Express Builders, recognizing delays not caused by them.
However, in January last year, the IIDC reviewed and modified its previous orders, withdrawing the lease rent waivers while keeping other reliefs intact. This review claimed a direct conflict with Noida Authority’s policy, which prohibits any lease rent waivers. The developers contested this withdrawal in the high court, asserting that the IIDC lacked the legal authority to unilaterally alter its prior decisions.
Their case gained traction from an April ruling by Justice Pankaj Bhatia, indicating that Section 41 of the UP Urban Planning and Development Act does not grant the revisional authority the ability to review its earlier orders. The court described the government’s order as “unsustainable in law,” ordering a recalculation of dues for the affected developers based on the original relief.
Worried about the financial implications of these waivers, the Authority resolved during a board meeting on June 14 to appeal or seek revisions in higher courts, cautioning that “allowing lease rent waivers could adversely affect the Authority’s revenue.” The Authority maintained that its policy categorically forbids such waivers and advocates for uniformity to safeguard its finances. Nonetheless, the court ruled in favor of Express Builders.
With Express Builders now granted relief, three significant developers have successfully reinstated their lease rent waivers.
