The Mumbai Metropolitan Country Development Authority (MMRDA) has decided to slap a penalty of Rs 101 crore on Jet Airways for failing to carry out construction over a plot it had bought in Bandra-Kurla Complex (BKC) in August 2006.
Jet, that is certainly carrying a debt burden of nearly Rs 13,500 crore, has appealed to MMRDA to waive the penalty, citing a troubled aviation organization and slump from the commercial realty market. The penalty amounts to a third on the original price of Rs 341 crore Jet paid to your 2.5 acre plot.
Under MMRDA rules, the winning bidder for a plot in BKC has to finish construction within four years of signing a lease. On expiry of this period, developers can get a maximum three-year extension provided they pay 10 per cent on the land’s significance for every on the first two years and 15 per cent to your third year, as penalty.
“Since Jet has just about dug up the basement on the plot, we estimate that the project will take three years to become completed. In accordance with our calculations, the penalty will add as much as Rs 101 crore,” said Deputy MMRDA Commissioner A R Wankhede.
Source: Indian Express
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