Surat civic body awaits ₹175 crore dues from builders over additional FSI

The revenue graph from paid FSI (Floor Space Index) for Surat Municipal Corporation (SMC) has been steadily rising. It recently took a hit, raising concerns about the realty sector. 

From April to November of the current financial year, builders who paid for FSI have submitted advance cheques to the SMC. However, cheques worth ₹625 cr have bounced, showing financial instability within the construction industry despite the boom in the market.

While the SMC’s Urban Development Department is pleased with the revenue from the FSI, which allows the construction of high-rise towers, the situation has worsened due to bounced cheques from builders. The accounts department is concerned due to the failure of builders to make payments.

This has raised an alarm within the system. Some developers managed to arrange the funds and deposit them into the SMC’s treasury. However, the builders whose cheques were returned, there are some well-known names and groups, SMC sources said.

The SMC has contacted the builders, and so far, ₹425 crore has been successfully recovered. However, more than ₹175 crore remains outstanding, and the SMC is actively working to recover the remaining dues from the respective developers.

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