Status as on- 14/08/2020

In an immense reassurance to Amrapali Homebuyers awaiting the delivery of their homes for over 10 years now, National Buildings Construction Corporation Limited (NBCC)  has said that it will hand over at least 150-200 flats every month from august.

Background

More than 40,000 buyers were stuck with under-constructed projects since the past decade after Amrapali Group was dragged to the court for alleged fraud and money laundering. NBCC took over the project in July on the SC orders after a petition by homebuyers following the Amrapali Group’s failure to deliver more than 30,000 flats in 15 projects. The promoters of the Group were found guilty for the same and jailed.

On July 23, Hon’ble Supreme Court appointed Shri. R. Venkataramani, Senior Advocate, Supreme Court as Court Receiver to carry out various activities related to registration of ready flats, accepting money from buyers, selling unsold flats, and ensuring completion of the stuck housing projects. Broadly, the company has split the pending projects into three groups. The first group includes Zodiac, Sapphire-I, Sapphire-II, Silicon-I, Princely Estate, Platinum & Titanium, and Leisure Valley Villas. The delivery deadlines of these seven projects are between January 2021 and June 2021.

Cause of Delay in Delivery and Relief provides by the Apex Court

NBCC has a budget outlay of Rs 8,500 crore for completion of the Amrapali projects. Till date, the Supreme Court has extended Rs 136 crore to NBCC. There are three sources of funds- balance amount due from homebuyers which is around Rs 3,800 crore, sale of the unsold inventory would fetch Rs 2,200 crore and surplus floor area ratio (FAR), which has not been consumed by Amrapali worth Rs 2,000 crore.

What role did the apex court play?

In this regard, the Supreme Court on 10^th June directed banks and financial institutions to restructure the loans given to homebuyers in order to ensure generation of substantial funds for construction of unfinished projects. Also, the SC directed banks and financial institutions that had declared home loans taken by buyers as non-performing assets (NPA), to release the balance amount of sanctioned loans. Thus ensuring that there is no cash crunch or any other hurdle in project completion.

Conclusion

Therefore, the role played by the Supreme Court is highly appreciable in regard to its efforts towards the protection of homebuyers interest. Also, the perceptible efforts by government’s construction arm- NBCC for revival of sick and moribund real estate projects should be cherished. Though, in the given case, accomplishment of the goal will depend upon each of the parties to the proceedings including, the court, NBCC, Banking Institutions as well as the homebuyers, but the battle half won should be celebrated.

Disclaimer- The above article is based on the interpretation of the related laws and judicial pronouncements. The readers are expected to take legal advice before relying on this article. The author can be reached at support@centrik.in or call the IP expert at 8383011629