The Greater Noida Industrial Development Authority (GNIDA) has paved the way for over 600 buyers to have their flats registered after it provided the occupancy certificate (OC) to a project that had stalled due to a funds crunch.
The project, RG Luxury Homes, was completed under the supervision of the interim resolution professional (IRP) after securing an order of reverse insolvency from the National Company Law Tribunal (NCLT). This is the first project in Uttar Pradesh's Gautam Budh Nagar district that has been completed and given OC through reverse insolvency process, officials said.
A reverse insolvency resolution process is a constitutional provision in the Insolvency and Bankruptcy Code (IBC) that allows corporate debtors to initiate the resolution process themselves. It's a mechanism primarily used to revive distressed real estate projects or companies that are undergoing insolvency proceedings. Under reverse insolvency, promoters are required to infuse funds in the project as a lender to complete a project.
Officials said that the move will benefit over 600 homebuyers as they will get possession of their flats along with ownership rights. The project, located on 18 acres in Sector 16B, Greater Noida West, was launched in 2010 with an initial completion deadline of 2014. However, the promoters ran out of cash and work came to a halt in 2016.
In 2019, a group of homebuyers approached the NCLT. This group constituted the buyers of 1,918 units in the first phase.
An IRP was appointed in July 2021 for the revival of the project. During the process, the promoter expressed his willingness to complete the project and presented a revival plan with the inclusion of finance and time-bound targets. The plan was supported by all stakeholders including financial institutions, CNIDA and the IRP.
In October 2021, RG Group restarted construction and development work under the supervision of the IRP.
Once complete, RG Luxury Homes obtained the OC for 600 units in towers D, E and F from GNIDA. Last year the group had obtained OC for towers A, B, C and M comprising 850 units, the company said.
Himanshu Garg, director, RG Group, said that securing the OC for another three towers of RG Luxury Homes marks an important milestone for the company.
“Now, we have OC of seven towers comprising 1,450 units. It is a testament to our hard work, dedication and willingness to complete the project. Very soon, the remaining 460 units of Phase 1 will be delivered," Garg told Moneycontrol.
Manoj Kulshrestha, the NCLT -appointed IRP, said that looking at the present scenario of real estate projects hitting NCLT and the prolonged resolution process, this project was a challenging task.
“To complete the project as per the submitted plan, the promoters sold their assets, collaborated with financial institutions and maintained the faith of the customers,” he said.
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