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Eight years after TN building collapse, apartment buyers struggle for compensation

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By Venkatachari Jagannathan
Chennai, June 4 (Ajit Weekly News) Come June 28, it will be eight years since the dream of owning a home in the Prime Trust Heights apartment project near here for 76 families came crashing down.

And there is still no hope for the apartment buyers to get their dream home or recover their life time savings.

On that fateful day, the under construction apartment, now what is known as the Moulivakkam building collapse case, came down crashing, killing 61 persons and injuring several, physically as well as financially.

“There are people who have invested their retirement money. We had invested our savings. Now we have to start from the scratch to own a home,” Ratna Mishra, a Human Resources executive in a private company and the President of the Moulivakkam Trust Heights Flat Buyers Association, told Ajit Weekly News.

“With the collapse of the building, our dreams of having our home were not only shattered but also resulted in a nightmare about our future and the maze of legal proceedings,” Mishra added.

She had bought an apartment with an investment of about Rs 40 lakhs saved over 20 years; but it all come down crumbling like a house of cards.

Similarly, K.S. Kannan, a Qatar returnee, was waiting for his apartment after paying Rs 37 lakhs.

The builder had promised the buyers possession in six months when the building came crashing down.

“Our lives have changed after that. It is more or less hand to mouth living with the interest from remaining fixed deposits. I am now 52 and not able to get a job,” Kannan told Ajit Weekly News.

Kannan said he and his family had stopped taking healthcare insurance as they could not afford it.

The apartment project was developed by the Madurai-based Prime Sristi Housing Pvt. Ltd. promoted by an Indian Bank employee turned builder, Manoharan.

The housing project, Prime Trust Heights, consisted of 84 apartments in two towers of 11 floors.

On June 28, 2014 one tower came down. Later, the Supreme Court ordered the demolition of the second tower as it became structurally weak owing to the collapse of one tower.

According to Mishra, out of 84 apartments, 76 were sold and the balance was with the developer.

For many apartment buyers in that ill-fated project, it took more than a year to come out of the trauma of losing their hard-earned money.

Recalling the formation of the association of the unfortunate home buyers, Mishra said: “Initially we didn’t know who the buyers were. But slowly we got in touch. The first meeting of the association members was held in a city mall.”

The association has 55 members with some deciding to stay out of frustration at their fate, she added.

The Tamil Nadu government set up a one-man commission to go into the causes of the building collapse. The Commission had recommended compensation to the apartment buyers from the State Disaster Relief Fund (SDRF).

However, the state government rejected that saying that the norms of the SDRF does not allow such payments.

According to Mishra, a complaint could not be filed with the Real Estate Regulatory Authority (RERA) as the building came down well before the Authority came into existence. The building project was beyond the cut-off date for filing a complaint.

The first legal setback for the home buyers was the dismissal of their writ petition against Tamil Nadu government claiming compensation.

Later they filed a case against the developer in the National Consumer Districts Redressal Commission (NCDRC), New Delhi.

“This was done to reduce the legal procedure. A decision of NCDRC can be appealed against in the Supreme Court only,a Mishra said.

According to her, the case did not come up for hearing in NCDRC earlier owing to other cases-demolition of the second tower and other filed cases and legal procedures.

She hoped the case would come to a closure this June. Nevertheless, the task of recovering their sunken investment is herculean task, said an advocate not wanting to be quoted.

The apartment buyers have paid about Rs.32 crore to the builder as purchase price.

“There are chances of the builder filing for insolvency if he was ordered to pay back the amount collected from the apartment buyers,” the advocate said.

Mishra said the builder has been assuring that he would sell the property and settle our dues but nothing has happened in that regard.

“Whether the builder is really interested in disposing of the 19-ground plot is not known. He may also be wanting to make a profit out of the deal,” one of the buyers told Ajit Weekly News.

The one option is to bring in another developer who can build the apartments for the original buyers and then make his money from selling the remaining apartments.

Couple of real estate industry officials told Ajit Weekly News that with the relaxed floor space index (FSI), a new building can construct up to 150,000 sq ft.

So, a new developer can build more than 84 apartments and take out his investment in redevelopment.

The moot question is whether any other private developer would come into picture at all.

“There are legal and sentimental issues involved relating to this plot. The unfortunate buyers can hold on to their property for some more years. They can exit once the property value appreciates and the unfortunate incident fades away from the people’s memory. Economics will play a major role in a positive outcome,” a top official of a noted builder, not wanting to be quoted, told Ajit Weekly News.

On the other hand, instead of the private developer, the state government through Tamil Nadu Housing Board (TNHB) can take over/buy the 19-grounds and settle the unfortunate flat buyers and develop the property.

“Many of the apartment buyers do not have money to invest further. Already they are paying monthly dues on their loans to the banks without a property,” Mishra said.

The apartment buyers are hoping that the DMK government would give them a dawn or `Vidiyal’.

As a matter of fact, in 2017, then Leader of the Opposition in the Assembly and the current Chief Minister M.K. Stalin had filed a case in the Madras High Court for a probe by the Central Bureau of Investigation (CBI) into the relaxations in building permissions, payment of adequate compensation to the apartment buyers, and recovering the same from violators of building norms.

(Venkatachari Jagannathan can be reached at v.j[email protected]

–Ajit Weekly News
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