Amrapali case: SC tells 9,538 buyers to register and pay up in 15 days or face allotment cancellation

SBI Cap is funding Rs 650 crore for six projects to bridge the temporary liquidity gap.

The Supreme Court on August 13 gave 15 days’ notice to 9,538 Amrapali homebuyers to fill their details on the court receiver’s website and start making payments, failing which the court receiver would be at liberty to cancel their allotment and include their units as part of the unsold inventory.

The two-member bench comprising Justices U U Lalit and Ajay Rastogi said that homebuyers who have not filled the customer data on the court receiver’s website nor paid any amount be granted 15 days’ time by the court receiver failing which they be declared as defaulters and their properties treated as unsold inventory.

However, the issue of 6,210 homebuyers who have taken the benefit of subvention scheme facility and are finding it difficult, will be addressed separately, the court said.

“This has been done to enforce homebuyers to deposit the remaining amount and also to identify bogus and undervalued flats. If these homebuyers don’t fill their particulars and start making payment for their unit, they are in for huge trouble. Their flat or villa may get cancelled,” said Kumar Mihir, advocate representing homebuyers in the Amrapali case.

This will also help the court receiver in implementing swapping of units and also to start the sale of unsold inventory to raise funds to complete unfinished units, he told Moneycontrol.

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The SC order is awaited.

Earlier, the Supreme Court-appointed court receiver R Venkataramani, tasked with monitoring the construction of Amrapali projects, had said in a note submitted before the apex court that 9,538 homebuyers have neither registered on the website nor made payments since the July 2019 order passed by the court.

Around 6,210 buyers though registered on the court receiver's website have not been making any payments, he had informed.

“Necessary direction is solicited from the court in order that allotments to such defaulting buyers shall be treated as cancelled after giving one final opportunity for expressing their interest in the allotment and making due payment. This will facilitate computation of unsold inventory which can be shared with NBCC for the purpose of affecting sale,” the court receiver had said.

The next date of hearing is August 27.

The court receiver also informed the bench that SWAMIH Fund had transferred Rs 10 crore as token amount and that another chunk is expected within a fortnight.

He also informed the court that UCO Bank, Bank of Baroda, Bank of India have agreed to form consortium to provide financial assistance to stuck Amrapali projects post the meeting held with 10 banks and their counsels on August 9.

The bench said that “All banking formalities have been completed and the first token release has taken place and the amount transferred to NBCC.”

The court receiver said in his note that following the order passed by the Supreme Court on August 2, he and the SWAMIH Fund authorities have executed the necessary fund related documents.

Also Read:  Amrapali case | SC asks banks to relax funding criteria for stalled Amrapali projects

He informed the court that meeting with 10 banking officials had been convened along with their counsels on August 9. While banks were inclined in principle to extend lending on a shared basis, several queries were raised.

Also Read: SBICap Ventures starts disbursement of funds for six projects of stuck Amrapali Group

These included in the event of any default in repayment, the income recognition and asset classification status should remain standard without any additional provision as per NPA norms

“The government/RBI may be directed to declare this as a priority sector funding whereby the capital charge shall be 20%. The government may further be directed to dispense with the requirement of external rating of the project. The government may be directed to come forward with a scheme of guarantee in line with Emergency Credit Line Guarantee Scheme,” the receiver informed the court.

The court receiver also said that Union Bank had agreed to sanction about Rs 300 crore housing loans to 3,000 Amrapali buyers immediately.

The court also disposed of the Mahagun-Noida Authority matter wherein it agreed that the baseline land bought by Mahagun should be in the name of their subsidiary Mahagun Infratech Pvt Ltd and the amount of Rs 170 crore submitted by them be transferred to Noida Authority. It also directed Noida Authority to execute a lease in favour of the subsidiary within 15 days.

The court had in 2019 asked the government’s construction arm to finish and deliver 38,159 flats by the erstwhile Amrapali Group by 2023 after several homebuyers sought its intervention, complaining about years of delay in handing over their homes.

The SC on October 13, 2020 had permitted the court receiver to incorporate a special purpose vehicle (SPV) to enable flow of funds from SBICap for completion of unfinished projects. SBICap has agreed to fund Rs 650 crore for around 7,000 stuck units.

It is for this reason that the company Amrapali Stalled Projects Investments Reconstruction Establishment (ASPIRE) has been floated. It consists of a court receiver, a forensic auditor and a chartered accountant. It is a not-for-profit company under Section 8 of Companies Act, 2013.

ASPIRE announced the sale of the units through an open draw in March 2021. As many as 20 of the 49 residential units spread across Amrapali projects in Noida and Greater Noida worth Rs 20 crore have been sold so far.

The units had been put up for sale in the month of March and the results of the offline draw were announced on June 14, sources said.

The total cost of completing all stuck projects by Amrapali Group is approximately Rs 8,500 crore. NBCC is executing these projects as PMC and would get 8 percent as fees. It is not using its funds, which are being facilitated by a receiver appointed by the Supreme Court.

On July 23, 2019, the top court cancelled the registration of the Amrapali Group under the Real Estate (Regulation and Development) Act, 2016, and ousted it from its prime properties in NCR by nixing land leases for breaching buyers’ trust.