Representative image of towers under construction in Pune (Source: ShutterStock)
SBICAP Ventures Ltd, the manager for the government's Rs 25,000-crore stressed-asset fund, on August 4 signed a MoU with the court receiver appointed by the Supreme Court to monitor stuck Amrapali projects for funding Rs 650 crore for six projects in Noida and Greater Noida, officials said.
According to the MoU, as many as 6,947 homes will be completed with the funding.
SBI Cap is funding Rs 650 crore for six projects to bridge the temporary liquidity gap.
The funding is for projects, Silicon City-1, Silicon City-2, Crystal Homes, Centurian Park- Low Rise, O2 Valley & Tropical Garden. The execution works on the said projects were hampered due to slow inflow of funds and disruptions caused by COVID-19 pandemic.
However, funding from SBICAP Ventures Ltd., NBCC shall expedite the progress of the works and will aim to complete the projects within the scheduled time, a NBCC statement said.
Those present on the occasion were the court receiver R. Venkataramani, committee members Ravi Bhatia (forensic auditor), D K Mishra (chartered accountant), Pavan Agarwal (forensic auditor appointed by the Supreme Court) and CMD, NBCC PK Gupta.
The Supreme Court on August 2 had asked banks to relax the funding criteria for stalled Amrapali projects that include submission of collateral security and corporate guarantees, saying that lending to the projects be treated as a special case since it was being monitored under the supervision of the apex court.
The two-member bench comprising Justices U U Lalit and Ajay Rastogi asked banks to hold a joint meeting with the court receiver by August 8 to arrive at a consensus on funding.
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 banks and prospective lenders had raised an issue with regard to ASPIRE (Amrapali Stalled Projects Investments Reconstruction Establishment) that was registered but does not have a credit rating as a company or past history of performance.
NBCC had also apprised the court receiver of the constraints faced by it for raising funds towards completion of stalled projects of the embattled firm. These included issues such as ASPIRE SPV not having any past history and credit rating as it is a newly formed entity.
It had also told the court receiver during a meeting held on July 29 that majority of banks had raised the issue of non-availability of collateral security in the form of mortgage of other assets/ sovereign and corporate guarantee or a letter of comfort.
Banks have been asking NBCC for a letter of comfort for financing the project.
The court had in 2019 asked the government’s construction arm to finish and deliver 38,159 flats by 2023 after several homebuyers sought its intervention, complaining about years of delay in handing over their homes.
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.