DHA residents complain Emaar builders owe them money

DHA approached residents to help file a case when Emaar stopped development in Phase VIII.

KARACHI:

The residents of Defence Housing Authority (DHA) have complained that Emaar builders owe them money from a project in Phase VIII that the company abandoned.

According to a petition by a group of residents, calling themselves Emaar Affectees, the company - Emaar Giga Karachi Limited - charged booking fee for its apartments, office towers, shopping malls and hotels planned for its Crescent Bay project. The project was launched on July 4, 2008.

The residents booked apartments and shops in the project and started paying their instalments. There was, however, hardly any progress on the buildings so they stopped the payments. The company sent reminders, but the residents demanded they show progress. Eventually, the company sent cancellation letters.

“We were shocked at this and a lot of affectees went to court against Emaar,” said a letter written by the group. The court issued a stay order on the bookings and prevented the builder from cancelling them.

After some time, DHA took over the land from Emaar, since the latter had abandoned the project. “The DHA officials promised us that they had done this to safeguard our interests, as it would not let us suffer.” The residents met several times and were assured that their money will be returned. In the case filed by DHA against Emaar under case number 891 in 2011, DHA asked the residents to intervene and support them.

The residents found out in December 2012 that DHA and Emaar reached a settlement. They were hopeful that they will get their money back only to find out that there was only one clause in the agreement, which vaguely mentioned repayments - the residents were left at the mercy of Emaar again. Emaar was able to get the land back, DHA received its pending payments, but the residents’ problems stayed the same. The residents have contacted DHA to help them out but to no avail. There are an estimated 300 people that Emaar has to pay back more than Rs1.5 billion.

According to the DHA Building Control and Town Planning Regulations of 2011, the residents quoted chapter 13, section 130 and  131, which makes Emaar legally bound to return the residents’ money with mark-up at the bank rate of between 12 per cent and 17 per cent for the past five years along with compensation equal to 10 per cent of the amount within 60 days of announcing that the project has been abandoned.

The residents insisted that the proof of abandonment was given by the DHA when they submitted their case in court. The residents demanded that Emaar should be prevented from relaunching their construction and sale and should not be allowed to do so without first clearing up this issue and paying them back. They warned others from falling into a trap like this.

Meanwhile, an official of Emaar group, Imran, explained that the project could not start on time due to a financial crunch in Dubai. Imran was hesitant to disclose information, but he assured that the company is trying to fix the problems.

The DHA insists that they are determined to safeguard the rights of those residents who were affected by the Emaar project. A spokesperson of the housing authority said that the affectees and Emaar developers arrived on a settlement out of court. When DHA saw that the project was making no progress, it took all stakeholders to court, he admitted. However, the residents and the builders agreed on a settlement out of court, he added.

Published in The Express Tribune, April 17^th, 2013.