FSI granted under a Chapter 14 scheme is not the same asset as FSI granted by a zone. Zone FSI attaches to the land. Scheme FSI is granted for a purpose, released against performance, and in several schemes it can be extinguished. An underwriting case that treats the two alike is mispricing the second one.
Key takeaways
- Scheme FSI is conditional, staged and in several cases extinguishable. Zone FSI is none of those things.
- The Affordable Housing Scheme releases only 1.00 of 3.00 free sale FSI at commencement. The rest follows construction and handover of the affordable component.
- An Integrated IT Township's residential occupancy needs one third of its IT area OCCUPIED, which depends on a leasing market rather than on the borrower.
- A Locational Clearance stands automatically cancelled on non-compliance, with no refund of premium, fees or expenses.
- Urban Renewal TDR is released only against construction that has received occupancy certificates, plus 50 percent of construction that has not.
- Regulation 7.5 runs the other way and protects FSI already consumed, including purchased TDR, through a redevelopment.
- The IBC (Amendment) Act 2026, assented 6 April 2026, codifies project-wise resolution, which cuts both ways for a secured lender.
- Dead registration rates fall with promoter scale, from 29.9 percent to 15.7 percent, but never approach zero.
- The RERA register carries no scheme flag at all, so none of this is visible without the scheme documents.
The distinction that drives everything else
Ordinary FSI is a property of the parcel. It is there on the day of purchase, it survives a change of owner, and its quantum is readable from the zone and the road width.
A Chapter 14 entitlement is a conditional grant. Government or the Authority permits a quantum of development because the proponent has undertaken to deliver something, and the grant is engineered so that the development arrives only as the undertaking is performed. That makes an unbuilt portion of scheme FSI a receivable contingent on delivery, not an asset in hand, and it should be discounted on the same logic a lender discounts any contingent receivable: by the probability of the condition being met, and by who controls it.
Three properties separate scheme entitlements from zone FSI, and each maps to a different underwriting adjustment.
Property one: it is released in stages
Chapter 14, Regulation 14.3, Affordable Housing Scheme*, the Affordable Housing Scheme, makes this visible because it publishes the release schedule as a table.
| Stage | Affordable component | Free sale component |
|---|---|---|
| Building permission or CC up to plinth for the affordable project | 3.00 | 1.00 |
| Completion of 50 percent built up area of the affordable component | - | 0.75 |
| Completion of 100 percent built up area of the affordable component | - | 0.75 |
| Handover of 25 percent of the land and the completed affordable component | - | 0.50 |
| Total | 3.00 | 3.00 |
Worked example. A 6,000 sq m plot under the Affordable Housing Scheme. Free sale sits on three quarters of the land, 4,500 sq m, at FSI 3.00, so the full free sale entitlement is 13,500 sq m of built up area.
At commencement, only FSI 1.00 has been released: 4,500 sq m, one third of the entitlement.
A facility sized against 13,500 sq m of saleable area at sanction is secured, on day one, against 4,500 sq m. The next 3,375 sq m arrives at 50 percent completion of the affordable component, a further 3,375 sq m at 100 percent completion, and the last 2,250 sq m only when a quarter of the land and the finished affordable buildings have been conveyed to the local body.
The final tranche is the one to model carefully, because it is not a construction milestone. It is a handover to a third party, and it can be delayed by title, by the local body's readiness to accept, or by the developer's own reluctance to convey. Regulation 14.3 reinforces this elsewhere: the occupancy certificate for the free sale component is withheld until the amenity space and its developed amenities are handed over, and that handover must complete within one month of the free sale OC application.
The underwriting adjustment is straightforward once the schedule is on the page: draw the security curve, not the completion curve, and set drawdown against released FSI rather than against the sanctioned total.
Chapter 14, Regulation 14.8, Urban Renewal Scheme* uses the same architecture with a different instrument. Chapter 14, Regulation 14.8.6, The permissible FSI for URC converts unusable FSI into Urban Renewal TDR, and then caps it: URT released at any point may never exceed the construction actually done for buildings that have received Occupation Certificates, plus 50 percent of construction done for buildings that have not. A cluster scheme's transferable value is therefore throttled by occupancy certificates, and an OC is issued by the Authority rather than earned by pouring concrete.
Property two: it can depend on somebody who is not the borrower
This is the property most often missed, because it does not look like a condition at sanction.
Chapter 14, Regulation 14.10, Integrated Information Technology Township (IITP), the Integrated IT Township, splits FSI evenly between IT or ITES use and residential plus commercial. Development of both halves may run simultaneously. But the occupancy certificate for the commercial, residential and support services is granted only after two things: the IT infrastructure has itself received an occupancy certificate, and one third of the area kept for IT activity is occupied.
Occupied. Not built, not marketed, not pre-let with an option. The residential half of an IITP is gated on a leasing market, and no amount of borrower diligence or contractor performance moves that gate.
Banded by scheme
- Affordable Housing Scheme (14.3)The borrower, mostly. Construction milestones plus a conveyance to the local body
- Integrated IT Township (14.10)A third party. One third of the IT area must be OCCUPIED before residential occupancy is granted
- Slum Rehabilitation (14.6)The occupiers and the SRA. 51 percent consent to submit, an eligibility list prepared by the Competent Authority, and an incentive ratio that moves with the ASR land to construction rate
- Urban Renewal Scheme (14.8)Owners and the Commissioner. 51 percent consent, with dissenters below 30 percent handled by acquisition at the implementation agency's cost
- Transit Oriented Development (14.2)The borrower, but the FSI is bought rather than granted, at 30 or 35 percent of the ASR land rate
Source: Chapter 14, UDCPR as updated 30 January 2025
The slum and urban renewal rows deserve a specific note for anyone pricing them. In both, the entitlement is calculated from a ratio of the ASR land rate to the construction rate, and in an Urban Renewal Scheme that ratio is fixed for the year the scheme is approved and remains unchanged for the entire project cycle. That is unusually lender-friendly: it removes the risk that a moving ASR re-prices the incentive halfway through a decade-long scheme. It also means a scheme approved in a soft year carries that year's economics for its whole life, which is a fact to check rather than assume.
Property three: it can be extinguished
Chapter 14, Regulation 14.1.1.4, Permission and Declaration of Project by State Government is the clause to read before treating a Locational Clearance as an asset on a balance sheet.
If the proponent fails to comply with the conditions specified while granting location clearance within the specified time limit, the location clearance given earlier stands automatically cancelled, and no refund or adjustment of premium, fees or expenses shall be eligible.
Separately, the clearance lapses after two years if no Letter of Intent is applied for, extendable by two years in aggregate on application before expiry.
For an Integrated Township Project, the premium is staged at 10 percent on Locational Clearance, 10 percent at Letter of Intent, 20 percent at Master Layout Plan sanction and 60 percent in four annual instalments. A proponent who has paid the first 40 percent and then falls out of compliance has spent it. That is a sunk cost with no recovery route, and it sits ahead of any secured lender in the sequence of things that can go wrong.
There is one provision that runs firmly the other way, and it is worth knowing because it protects historic value. Chapter 7, Regulation 7.5, Protection of FSI in Redevelopment of Existing Buildings provides that on redevelopment, permissible FSI is the zone figure or the FSI consumed by the existing authorised building including TDR and premium FSI, whichever is more, and that purchased TDR already used is treated as authorisedly consumed FSI entitled for redevelopment. A building that bought development rights decades ago does not lose them when it comes down.
What insolvency now does, and what changed in April
The recovery analysis on a scheme-linked exposure changed materially this year.
The Insolvency and Bankruptcy Code (Amendment) Act, 2026 received Presidential assent on 6 April 2026 and codifies project-wise resolution: insolvency may be initiated against a single failing project without triggering proceedings against the developer's entire corporate entity, alongside provisions allowing homebuyers to take possession during an ongoing process and protecting occupied units from liquidation.
That codifies a route the tribunals had already taken. In the Supertech matter, the NCLT's Delhi bench admitted a Section 7 application by Union Bank of India in March 2022 on a claimed default of over Rs 432 crore relating to the Eco Village II project at Greater Noida. In June 2022 the NCLAT limited the corporate insolvency resolution process to the Eco Village II project alone, and in May 2023 the Supreme Court upheld that project-wise approach. It is the reference case for the concept, on public record and decided.
Project-wise resolution cuts both ways for a secured lender, and which way depends on where the exposure sits.
It helps where the lender financed the good project in a group with a bad one. Ring-fencing means one failing project no longer drags a performing project of the same borrower into a single estate, so a well-secured project-level exposure is less likely to be diluted by claims arising elsewhere in the group.
It hurts where the underwriting leaned on the corporate balance sheet. A guarantee from a parent whose other projects are ring-fenced away is worth less than the consolidated accounts implied, and cross-collateralisation across a developer's portfolio becomes harder to realise, because the estate a claim lands in is now the project rather than the company.
The follow-through is live rather than settled. IBBI constituted a committee on guidelines for real estate insolvency which reported on 7 April 2026, and issued a discussion paper on 30 June 2026 proposing project-wise insolvency mechanics, ring-fencing of project funds, exclusion of completed projects from CIRP where appropriate, a simplified claim form for homebuyers and independent technical and cost assessments, with comments invited to 21 July 2026. Execution risk is real: IBBI suspended the registration of an insolvency professional in the Supertech matter in March 2026, finding multiple lapses. A project-wise process is only as good as its administration.
Treat the framework as settled and the mechanics as in flight.
The scale question, answered with the register
The instinctive mitigant for all of this is to lend to large developers. The register lets that be tested rather than assumed.
Source: ReraGenie analysis of MahaRERA filings, captured 15 August 2026
The gradient is real and monotonic: the dead registration rate falls from 29.9 percent for single-registration promoters to 15.7 percent for the 18 profiles holding 25 or more. Scale does correlate with survival.
It also does not rescue the case. 15.7 percent is roughly one registration in six, among the largest and most experienced promoters in the state. A concentration limit that treats a top-tier developer as materially de-risked is reading a gradient as a floor. The honest use of this chart is as a prior to be updated by the specific filing, not as a substitute for reading it.
Two cautions on the data. Registration status is a current field, so a Completed project and a Lapsed one are both terminal states of different kinds, and "dead" here means the registration is no longer live, which is not the same as the project having failed. And promoter profiles are MahaRERA's own identifiers, so a promoter operating through several special purpose vehicles appears as several profiles, which pushes genuine portfolio scale downward in this table rather than upward.
What the Bhandarkar family office asks first
The Bhandarkar family office in Pune runs a two-person investment team and evaluates AIF commitments alongside direct structured deals. Their sector allocation is competing with a crowded field: SEBI data shows real estate as the top sector for AIF investment, at a record Rs 1.29 trillion as at March 2026, with Category II AIF commitments at Rs 11.64 lakh crore as at December 2025, up 16 percent year on year.
Their first question on any scheme-linked opportunity is not the IRR. It is: which of these three properties applies, and who holds the condition?
Staged release means the model runs off released FSI. A third party condition means the case is partly a leasing case wearing a development case's clothes. Extinguishability means the sunk premium is at risk ahead of them.
Their second question is the one this article exists to answer: none of it is in the register. MahaRERA carries no scheme flag. A tower inside an Integrated Township, a free sale component of an SRA scheme and an ordinary greenfield launch register identically, and the filing does not record which it is. Nor can FSI be audited from the filing: dividing the filed permissible FSI by the filed land area produces a distribution whose 99th percentile exceeds 20, because RERA registers phases against parcels that need not match the sanctioned layout.
So the scheme documents have to be obtained: the Locational Clearance notification, the Letter of Intent, the sanctioned Master Layout Plan, the premium receipts and the release schedule. What the register then provides is the independent check on what has actually been delivered against them.
Names and numbers in this story are illustrative.
Related reading
- Integrated Township Projects: 40 hectares, four approvals
- Affordable Housing Scheme and PMAY
- Urban Renewal Scheme: cluster redevelopment
- Reading the permission chain before releasing a tranche
- What RERA filings tell a lender that the borrower's MIS cannot
Where the filings come in
Scheme approvals sit with Government, the Collector, the SRA or the Planning Authority. The register is the delivery record.
Every project at reragenie.com is free to read and carries the filed land area, the buildings and their floors, the sanctioned and sold units where filed, the construction progress by building, the registration status as filed, the promoter's extension history with the reasons given, the certifying professionals, and any complaints or litigation with case numbers.
For a scheme-linked case, the ReraGenie project analysis at Rs 2,999 reads one project's full filing and the documents behind it and sets the promoter's whole record against the register, which is where a phase-by-phase township or a multi-phase SRA scheme becomes legible as one programme. The area consolidated report, Rs 2,999 for the first project and Rs 1,999 per additional one, covers a micro-market, which is the unit a concentration limit is written against.
Sources. Insolvency and Bankruptcy Code (Amendment) Act, 2026, Presidential assent 6 April 2026. IBBI committee report on real estate insolvency guidelines, 7 April 2026, and IBBI discussion paper on real estate CIRP reforms, 30 June 2026. Supertech Eco Village II: NCLT Delhi admission March 2022, NCLAT order limiting CIRP June 2022, Supreme Court upholding project-wise resolution May 2023. SEBI alternative investment fund data as reported for March 2026 and December 2025. ReraGenie analysis of 55,456 published MahaRERA registrations across 42,389 promoter profiles, captured 15 August 2026.
Source: Unified Development Control and Promotion Regulations for Maharashtra, UDCPR as updated 30 January 2025. Sanctioned under the Maharashtra Regional and Town Planning Act, 1966.
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