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TMI Blog2020 (6) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... ially constructed structure and partial dues have been paid to the Noida and Greater Noida Authorities. It cannot be disputed that the rate of interest, on which agreements were entered into, has gone down by now. The present lending rate is much below and the RBI has taken several steps to revive the economy. In such a scenario, it would never be possible to make payment of interest at the rate fixed by authorities and also a penal interest to be realized by concerned authorities. The home buyers are not able to obtain fruits of the investment and are deprived of legal title of the flats. Considering the current state of real estate, the projects are standstill, and in order to give impetus to such housing projects and mainly considering plight of home buyers and as pointed out by Noida and Greater Noida Authorities that 114 plots were allotted from 2005 onwards, most of projects are incomplete; we direct that rate of interest on the outstanding premium and other dues to be realized in all such cases at the rate of 8% per annum and let the Noida and Greater Noida Authorities do a restructuring of the repayment schedule so that amount is paid and Noida and Greater Noida Autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .O.R.) Mr. Dheeraj Nair, AOR, Mr. Kumar Kislay,Adv. Vishrutyi Sahni,Adv. Ms. Shobha Gupta,Adv. Mr. P.B.A. Srinivasan, Advocate Mr. Aman Gupta A.O.R. Mr. Avinash Mohapatra, Advocate Mr. Parth D. Tandon, Advocate Mr. Neelam Phukan, Advocate Mr. Sanjai Kumar Pathak, AOR Ms. Shashi Pathak, Advocate Mr. Arvind Kumar Tripathi, Advocate Mr. Rohit Amit Sthalekar, AOR Mrs. Mayuri Raghuvanshi, AOR Mr. Vyom Raghuvanshi, Advocate Ms. Sangya Negi, Advocate Mr. Alok Kumar,Adv. Mr. Balaji Srinivasan, Adv. Ms. Garima Jain, Adv. Sowmya Yadava, Adv. Mr. Dharmendra Kumar Sinha, AOR Mr. Shailendra Singh, Adv. Mr. M.T. George,Adv. Mr. Johns George,Adv. Mr. Divyakant Lahoti, AOR Mr. Parikshit Ahuja, Adv. Ms. Praveena Bisht, Adv. Ms. Vindhya Mehra, Adv. Ms. Madhur Jhavar, Adv. Mr. Kartik Lahoti, Adv Ms. Anannya Ghosh,Adv. Ms. E. R. Sumathy, AOR Mrs. Savita Aggarwal, advocate Ms. Kirti R. Mishra, AOR Ms. Apurva Upmanyu, Adv. Mr. Sukant Vikram,Adv. Mr. Kumar Shashwat,Adv. Mr. Arpit Rai, Adv Mr. Aviral Kashyap, AOR Mr. Dheeraj Nair, AOR, Mr. Kumar Kislay,Adv. Vishrutyi Sahni,Adv. Mr. Sanjay Kapur, AOR Ms. Megha Karnwal, Adv. Mr. D. P. Singh, Adv. Mr. Anurag Tandon, Adv. Mr. Archit Singh, Adv. Ms. Sonam Gupt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Prakash Kumar Singh,Adv. Dr. Brij Bhushan K. Jauhari,Adv. Ms. Purnima Jauhari,Adv. Mr. Gopi Nair,Adv. Mr. Harsh Mahan,Adv. Mr. O.P. Singh,Adv. Mr. S. Devashish Das,Adv. Mr. Sudhanshu Palo,Adv. Mr. Shovan Mishra, AOR Mr. Vivek Narayan Sharma, AOR Mr. Naresh Kumar, AOR Mr. Shishir Pinaki, AOR Sayaree Basu Mallik, AOR Ms. Pallavi Pratap, AOR Mr. Raj Kamal, AOR Mr. Kumar Mihir, AOR Mr. Sukant Vikram, AOR Mr. Amit Pawan, AOR Mr. Kailash Prashad Pandey, AOR Mr. Himanshu Shekhar, AOR Mr. Manish Kumar Saran, AOR Mr. Abdul Azeem Kalebudde, AOR M/S. Dharmaprabhas Law Associates, AOR Mr. A. P. Mohanty, AOR Mr. Shadan Farasat, AOR Mr. G. Balaji, AOR Mr. Gopal Jha, AOR Ms. E. R. Sumathy, AOR Mr. Aniruddha P. Mayee, AOR Mr. Rameshwar Prasad Goyal, AOR Mr. Ashok Kumar Singh, AOR Mr. Binay Kumar Das, AOR Ms. Jasmine Damkewala, AOR Mr. Prithvi Pal, AOR By Courts Motion Mr. Prakash Ranjan Nayak, AOR Mr. Mohammed Sadique T.a., AOR Mr. Gaurav Goel, AOR M/S. Cyril Amarchand Mangaldas Aor, AOR Mr. Akhilesh Kumar Pandey, AOR Ms. Rakhi Ray, AOR Mr. Badri Prasad Singh, AOR Mr. Gaurav Goel, AOR Mr. Ravindra Kumar, AOR Ms. Garima Prashad, AOR Mr. Balaji Srinivasan, AOR Mr. Rajesh Kumar Gupta, AOR Mr. Mukesh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... R Mr. Naveen Kumar, AOR Mr. Somiran Sharma, AOR Mr. Kaushik Choudhury, AOR Mr. Aakarshan Aditya, AOR Mr. Mushtaq Ahmad, AOR Mr. Shree Pal Singh, AOR Ms. Rashmi Singh, AOR Mr. Malak Manish Bhatt, AOR Mr. Dhananjay Garg, AOR Mr. Brijesh Kumar Tamber, AOR Mr. Anis Ahmed Khan, AOR Mr. Chandan Kumar, AOR Mr. Raj Kamal, AOR Mr. Pawanshree Agrawal, AOR Ms. Manju Jetley, AOR Mr. Nitish Massey, AOR Mr. Rabin Majumder, AOR Mr. Balraj Dewan, AOR Ms. Vandana Sehgal, AOR Mr. Sureshan P., AOR Ms. Misha Rohatgi, AOR Mr. Rakesh Kumar-i, AOR Mr. Siddhartha Jha, AOR Ms. Anisha Upadhyay, AOR Mr. Aman Gupta, AOR Ms. Anannya Ghosh, AOR Mr. Ashok Mathur, AOR Mr. Raj Singh Rana, AOR Mr. Prakash Kumar Singh, AOR Mr. Mohit D. Ram, AOR M/S. V. Maheshwari Co., AOR Mr. Prem Prakash, AOR Mr. Nikilesh Ramachandran, AOR Mr. K. Paari Vendhan, AOR Mr. Avneesh Arputham, AOR Mr. Tejaswi Kumar Pradhan, AOR Mr. T. Mahipal, AOR Mr. Anas Tanwir, AOR Applicant-in-person, AOR Ms. Praveena Gautam, AOR Mr. Ashwarya Sinha, AOR Ms. Jasmine Damkewala, AOR Mr. Vipin Kumar Jai, AOR Ms. Sujata Kurdukar, AOR Ms. Indra Sawhney, AOR Mr. Abhishek Agarwal, AOR Dr. Nafis A. Siddiqui, AOR Mr. Joby P. Varghese, AOR Mr. Sumit Sinha, AOR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Pandey, AOR Mr. Sibo Sankar Mishra, AOR Mrs. Kirti Renu Mishra, AOR Mr. Pawanshree Agrawal, AOR Ms. Charu Mathur, AOR Ms. Suruchii Aggarwal, AOR Mr. Kaushik Choudhury, AOR Mr. Umesh Kumar Khaitan, AOR Ms. Pallavi Pratap, AOR Mr. Sanjay Kumar Visen, AOR Mr. Satish Pandey, AOR Mr. Karunakar Mahalik, AOR Ms. Praveena Gautam, AOR Mr. Raj Kamal, AOR Mrs. Mona K. Rajvanshi, AOR Mr. Christopher Dsouza, AOR Mr. Sukant Vikram, AOR Ms. Kamakshi S. Mehlwal, AOR Mr. Mushtaq Ahmad, AOR M/S. Dharmaprabhas Law Associates, AOR Mr. Sunny Choudhary, AOR Mr. Pradeep Misra, AOR Mr. Aviral Kashyap, AOR Mr. Ashok Kumar Singh, AOR Ms. Richa Kapoor, AOR Mr. Rohit Amit Sthalekar, AOR Mrs. Gargi Khanna, AOR Nitish Massey, AOR Mr. Gautam Das, AOR Mr. Gaurav Goel, AOR Mr. Harish Pandey, AOR Mr. Pramod Dayal, AOR Mr. S. S. Shroff, AOR Ms. Shobha Gupta, AOR Mr. Sanchit Garga, AOR Ms. Mayuri Raghuvanshi, AOR Mr. Divyakant Lahoti, AOR Mr. Kumar Dushyant Singh, AOR Mr. Jasmeet Singh, AOR Mr. Prakash Kumar Singh, AOR Mr. Roopansh Purohit, AOR Ms. Misha Rohatgi, AOR Ms. Anubha Agrawal, AOR Mr. Syed Mehdi Imam, AOR Mrs. Anil Katiyar, AOR Mr. Brijesh Kumar Tamber, AOR Mr. B. Krishna Prasad, AOR Mr. Shakil Ahmed Syed, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d itself in different Courts being a party to the said petitions. For instance, a summon has been received from the State Consumer Redressal Commission, Lucknow against the CMD. The NBCC has been arrayed as respondent No.3. A complaint has also been preferred by one of the home buyers of the Amrapali Golf Homes, Greater Noida. They are receiving various letters, emails, messages, calls seeking updates regarding the progress of work being undertaken by the NBCC for their respective projects. Reply to every home buyer is a herculean task, and much time is being consumed in the process. The NBCC is ready and willing to submit monthly project reports with all relevant information and photographs in respect of each project to the learned Receiver, which can be made available on the blog/website for the information of home buyers, for that the NBCC has already made a request to the learned Receiver as such various directions have been sought. 3. NBCC is asked by this Court to complete the incomplete projects. It is not liable for any legal action. In view of the order that has been passed by this Court, the NBCC is immune from any such actions, and we request the Courts/ Consumer Redr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... verred that due to litigation, the goodwill of the project has been severely affected, and construction work is considerably slowed down due to lack of funds. The vendors have stopped offering credit. The existing buyers are not making payments. The average yearly collections had also dropped from ₹ 61.86 crores in the year 2018-19 to ₹ 17.85 crores in 2019-2020. Despite part injunction lifted by this Court, the project could register new sales of only 15 units, and only ₹ 1.42 crores could be recovered. The banks have also stopped making further disbursement of the retail loans to individual home buyers. Fourteen buyers have cancelled their units. The RERA has ordered a refund of 6 units along with interest upon the complaints filed before it. A loan was taken at a very high rate of 21% in order to deposit the amount. It will be difficult to repay the loan in case interest is not waived. Home buyers' interest is at stake as the project has been delayed for more than three years due to the injunction of this Court. This Court vide judgment dated 23.7.2019 directed various entities to deposit the amount with the Registry and did not direct payment of any intere ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued by this Court to execute tripartite Agreement concerning projects, where flat buyers are residing within a period of one month. The concerned authorities are duty-bound to implement the judgment. As the Registry did not accept the review petition, applications have been filed. The Noida Authority had allotted a total of nine Group Housing Plots in favour of the Amrapali Group of Companies. This Court ordered the cancellation of the lease of Amrapali Group of Companies and the property vest in Receiver. The outstanding dues of ₹ 2,191.38 crores existed against the allotment of nine Group Housing Plots as only partial payment has been made. This Court also directed that the land dues can be recovered from other properties of Amrapali Group, which have been attached. The Noida and Greater Noida Authorities are entrusted with the task of holistic development of the industrial area, which includes the construction of various infrastructural projects and carrying out of municipal works, catering to more than 15 lakhs population. The recovery of dues is necessary as it is public money. It is submitted that as per the terms of allotment and lease deed, the builder was entitled to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... promoter as such it was not entitled to sell FAR. Learned Receiver pointed out that in Dream Valley Project in Greater Noida, the authorities had sanctioned FAR @ 3.5, which include up to 2.75 permissible FAR and 0.75 purchasable FAR. In Silicon City, Noida, the Authority had sanctioned up to 2.75 FAR and an additional 15% FAR over and above 2.75 FAR. As this Court cancelled the leases granted in favor of the Amrapali Group of Companies by the Noida and Greater Noida Authorities, the rights have vested in the Receiver. The Receiver has also attracted our attention to the findings recorded in the judgment to the effect that buyers have paid the dues of Noida and Greater Noida Authorities as a component of the price for flats. Thus, the premium and other dues payable under the lease deeds to the Noida and Greater Noida Authorities cannot be recovered from the home buyers or the projects in question. The directions have been issued to the effect that Noida and Greater Noida Authorities could not sell the buildings or demolish them nor could enforce the charge against home buyers/leased land/projects, in the facts of the case and ultimately various directions were issued by this Court. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... / projects in the facts of the case. Similarly, the banks cannot recover money from projects as it has not been invested in projects. Homebuyers money has been diverted fraudulently, thus, fraud cannot be perpetuated against them by selling the flats and depriving them of hard-earned money and savings of entire life. They cannot be cheated once over again by sale of the projects raised by their funds. The Noida and Greater Noida Authorities have to issue the Completion/ Part Completion Certificate, as the case may be, to execute tripartite agreement and registered deeds in favour of the buyers on part-completion or completion of the buildings, as the case may be or where the inhabitants are residing, within a period of one month. 154. Resultantly, we order as follows: (i) The registration of Amrapali Group of Companies under RERA shall stand cancelled; (ii) The various lease deeds granted in favour of Amrapali Group of Companies by Noida and Greater Noida Authorities for projects in question stand cancelled and rights henceforth, to vest in Court Receiver; (iii) We hold that Noida and Greater Noida Authorities shall have no right to sell the flats of the home bu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er places in various States, where projects have not been completed. They are further directed to ensure that projects are completed in a time-bound manner as contemplated in RERA and home buyers are not defrauded. (x) We appoint Shri R. Venkataramani, learned Senior Advocate, as the Court Receiver. The right of the lessee shall vest in the Court Receiver and he shall execute through authorized person on his behalf, the tripartite agreement and do all other acts as may be necessary and also to ensure that title is passed on to home buyers and possession is handed over to them. (xi) We also direct Noida and Greater Noida Authorities to execute the tripartite agreement within one month concerning the projects where homebuyers are residing and issue completion certificate notwithstanding that the dues are to be recovered under this order by the sale of the other attached properties. Registered conveyance deed shall also be executed in favour of homebuyers, they are to be placed in the possession and they shall continue to do so in future on completion of projects or in part as the case may be. We direct the Noida and Greater Noida Authorities to take appropriate action to do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o complete the projects. Financial institutions/ Banks are not coming forward to fund the incomplete projects, and the buyers who borrowed the money from the banks have not been able to obtain possession of the flats booked by them due to the non-completion of the projects. On the other hand, the liability to pay the interest on the amount of loan, which they had taken, is fastened upon them, and they have been duped by diverting money by the builders. 18. In view of the finding recorded in the judgment delivered by this Court on 27.3.2019, the FAR is made available only because of the investment made by the home buyers, but for that, the FAR would not have been available. Thus, they should have the first charge on it as they have deposited the money which had been diverted. Thus, we find no justification in the prayer made by the Noida and Greater Noida Authorities to release the FAR, which was available to the erstwhile Amrapali Group of Companies, and all the rights of the builders are now vesting in the Receiver. A finding was recorded earlier that builders were not entitled to release of FAR as they did not fulfil the obligation, does not come in the way of availability of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Water/Power/Sewage/Pollution etc. shall adhere to the advice/ request of the Receiver appointed by this Court and will consider the same as a direction issued by this Court. (vii) With respect to purchasable FAR, if any amount is payable to Noida and Greater Noida Authorities it shall be paid after the sale of the FAR. 19. Thus, I.A. Nos.141062 of 2019 and 155624 of 2019 relating to the release of FAR are rejected. It is made clear that while passing this order, we have not commented on the other prayers made in the applications. They are to be decided later on. In Re. I.A. No.166987 of 2019 and I.A. No.29699 of 2020 in I.A. No.166987 of 2019 filed by Vansh Consultants Private Limited. 20. I.A. No.166987 of 2019 has been filed by Vansh Consultants Private Limited, seeking deletion of its name from the summary of Report of Forensic Auditors contained in paragraph 60(17) of the judgment dated 23.7.2019. It is submitted that the applicant had invested ₹ 10 crores in the Amrapali Leisure Valley Private Limited. It has been mentioned in the judgment that an amount of ₹ 9.75 crores is recoverable from the applicant. Due to some inadvertent error, the n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ate Limited 4,26,27,790 Ajay Kumar 4,05,40,931 Star Land Craft Private Limited 4,01,85,888 Heartland City Developers Private Limited 4,01,22,762 Vidhya Shree Buildcon Private Limited 4,00,00,000 Sky Tech Buildcon Private Limited 3,88,53,775 Skyline Tele Media Services Limited 3,48,02,771 Shantinath Enterprises 3,24,71,100 Red Star Tradex P Ltd. 3,00,00,000 Mohabbat S/o Abbas 2,66,99,000 Total of top 20 companies/parties 1,64,72,21,039 It can be seen from records that the recoverable are due since long and there are mostly no movements subsequently either in the form of booking of expenses or receipts. Out of the amounts recoverable from parties in case of Ultra Home Construction Pvt Ltd, 20 parties having huge balances recoverable ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... applicant submitted that ₹ 10 crores' investment was not reflected in the opening balance of the Amrapali Leisure Valley Private Limited. An amount of ₹ 8 crores received by the applicant from Amrapali Leisure Valley Private Limited has not been reconciled against the payment of ₹ 10 crores paid by the applicant. The applicant company does not owe any loan to the Amrapali Group of Companies or the home buyers. The applicant is entitled to receive money from Amrapali Leisure Valley Private Limited. The incomplete entries in the books of accounts of the Amrapali Group of Companies have resulted in an incorrect appreciation of entries about the applicant company. Thus, the prayer has been made to delete the applicant's name from the table contained in paragraph 60(17) of the judgment dated 23.7.2019. 23. In continuation of I.A. No.166987 of 2019, I.A. No.29699 of 2020 has been filed for directions. It is submitted that the Forensic Auditor s report violates the principles of natural justice. The Forensic Auditors have shown the applicant as an inter-corporate depositor. The Forensic Auditors sent an email dated 6.2.2020 to Mr. Raj Kumar Jain, Mr. Balbir Si ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orensic Auditors. Thus, prayer for deletion of the applicant's name from the judgment and the report of Forensic Auditor has been made. 25. The Forensic Auditor, Shri Pawan Agrawal, pointed out in detail the various facts in the documents submitted by the applicant itself. It was pointed out that there was nothing to dispute the debit entries made in the accounts of Amrapali Leisure Valley Private Limited, and on interrogation, the facts could not be explained. Several shell companies were created or used to divert the money of home buyers. Forensic Auditor further pointed out that the agreement entered into between Vansh Consultants Private Limited and Amrapali Leisure Valley Private Limited is dubious and designed to hide actual transactions behind this agreement. Forensic Auditor also pointed out that the tower number given in the agreement is F2, having total 34 floors (G+33) and 102 flats. Amrapali Leisure Valley Pvt. Ltd. has no sanction plan of constructing any building of 34 floors. Further, there is no tower, namely, F2. The tower and flats mentioned in the agreement were not in existence at any point of time. 26. Forensic Auditor further pointed out that it was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ner. The documents of applicant are contradicted by the accounts maintained by Amrapali Leisure Valley Private Limited. In the facts and circumstances of the case, we find that no case is made out to allow the prayers made in the applications. The applications are bereft of any merits and are hereby dismissed. In Re. Financing of Home Buyers by Banks 28. Learned Receiver submitted that the RBI may be directed to advise all banks and financial institutions such as insurance companies, and employers of the establishments which have sanctioned home loans to home buyers to disburse all balance loan amounts to the home buyers whose accounts are regular and they will abide by instructions issued by the Receiver in this regard. It is further pointed out that banks have certain reservations regarding the funding of NPA accounts. In view of current social and economic conditions, the Court may direct the RBI to keep its circulars/guidelines relating to NPA in abeyance and permit all banking and financial institutions, etc. to disburse loans to home buyers notwithstanding the status of accounts as NPA. Banks and financial institutions be directed to work out a long-term restructu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e is a lack of clarity concerning dues of local authorities/banks/lenders. It has been submitted that proper relaxations and concessions are required to be given concerning such dues. 32. In the interlocutory application filed by Ace Group of Companies, precarious conditions in the entire Noida and Greater Noida region faced by the developers have been pointed out. It is submitted that following economic recession in the last decade, the entire real estate sector has gone downwards and facing acute financial crunch and is fighting for its survival. The projects are incomplete, there were various litigations which created a huge financial impact and non-delivery of projects, which reflects the pathetic condition of the real estate sector. Multiple issues are pointed out, which are adding to the woes of the developers. It is averred that the developers and the home buyers both are adversely affected due to non-delivery of booked flats in the regions of Noida and Greater Noida etc. 33. The Ace Group of Companies obtained the plots between the period 2010 and 2015 from the Authorities in the aforesaid areas. The Noida Authority is raising additional demand at the rate of ₹ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If the base rate of SBI MCLR is compared with the interest rate charged by the Noida and Greater Noida Authorities, one can easily find out that it has drastically been reduced over the years and ranges between 7.5% to 8.15% over the last ten years. The rate and historical data on the base rate of SBI is filed. 35. It is further averred that over a period of time in the last five years, the Banks have also reduced the interest paid on Fixed Deposits and currently, it ranges between 6% to 7% only. However, Noida and Greater Noida Authorities, despite allotting encumbered and disputed land coupled with various other issues, failed to take any step to either reduce the exorbitant rate of interest or completely waive off the interest and other charges on account of delay and default in paying the land dues. The Developers and the applicants and home buyers have acquired valuable right in the land by paying the hefty amount. The developers have made numerous efforts by approaching the concerned authorities for redressal of their grievances. Till date, there has been no resolution. Neither the Authorities nor the State Government has taken the issues seriously. The issue of the inter ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , and 7 obtained part-completion certificates. Thus, it is apparent that more than 60% of projects have not been able to come up so far. We have also noted that the Noida and Greater Noida Authorities did not take the step of termination of leases for various reasons. A large number of home buyers have been waiting now approximately for the last 8 to 10 years or more for completion of houses. It is not in dispute that the real estate sector has suffered a setback at present. It contributes to the GDP of the country. As a large number of projects have not come up, at the same time, Noida and Greater Noida Authorities have not been able to realize their dues from such projects which are being piled up for the last several years, at the same time interest of home buyers has intervened. Even on the plots where the land was allotted from 2005 onwards, the projects have not been completed so far, though the buyers have paid their money. The Noida and Greater Noida Authorities are not issuing completion certificates to such projects and they are not able to realize their outstanding dues. For various reasons, constructions have not been completed, including due to diversion of funds. Ther ..... X X X X Extracts X X X X X X X X Extracts X X X X
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