MahaRERA Issues ₹90 Crore Recovery Warrants Against Honest Shelters in Palais Royale Dispute

Regulatory Authority Issues Recovery Orders Worth ₹90 Crore Against Worli Project Developer

The troubled Palais Royale project in Worli has faced renewed scrutiny from regulatory authorities, with the Maharashtra Real Estate Regulatory Authority (MahaRERA) issuing warrants for the recovery of approximately ₹90 crore in interest payments from its current promoters, Honest Shelters Pvt Ltd.

The enforcement action was triggered following complaints filed by IIFL Finance Ltd, which holds ownership rights to seven units within the project. The dispute emerged from the promoter's failure to comply with a January 16 directive from MahaRERA orders for post-possession duties, which mandated the handover of unit possession along with compensation for delayed delivery.

Enforcement Orders and Recovery Process

The adjudicating officer, Ashok Alaspurkar, issued four separate recovery orders between July 27 and August 4, directing the collection of interest payments related to four residential units. Additional warrants were subsequently issued for three more units owned by IIFL Finance, bringing the total disputed units to seven.

The financial institution reported non-compliance on March 21 and subsequently filed an execution application with the regulatory authority. The promoter's argument challenging the officer's jurisdiction was rejected by the authorities.

Project History and Legal Background

In 2019, Honest Shelters acquired the Palais Royale project from Shree Ram Urban Infrastructure through an auction conducted by Indiabulls Housing Finance. IIFL Finance Ltd obtained rights to the disputed flats from original purchasers through deed of transfer cum assignment following defaults under mortgage agreements.

MahaRERA confirmed that IIFL, recognized as an allottee, remains entitled to interest payments until January 16, 2025, with additional interest accruing until possession is transferred with a valid occupation certificate.

Case Summary Details

The ₹90 crore warrant issuance against Honest Shelters in the Palais Royale case demonstrates MahaRERA's strengthening enforcement approach toward RERA rules in real estate disputes and protecting the rights of financial institutions in high-value property conflicts.