September 12, 2019

SC Asks National Buildings Construction Corporation About What Must Be Done With Amrapali Group’s Unsold Flats

[ By Bobby Anthony ]


The Supreme Court has asked the National Buildings Construction Corporation (NBCC) and others to suggest methods to deal with unsold flats of real estate group, the Amrapali Group with worth Rs 2,337 crore.

A bench, headed by Justice Arun Mishra, asked the NBCC, the forensic auditors and court-appointed receiver to work out the modus operandi and feasibility of how to sell and dispose of the 5,229 unsold flats which will fetch an amount of Rs 2,337 crore.

It has also directed the six banks, namely Bank of India, Bank of Baroda, Union Bank of India, Corporation Bank, Syndicate Bank and Bank of Maharashtra, to appear on October 4, the next date fixed for hearing and explain how they can release the remaining installments to the home buyers.

The court has asked the authorities to suggest modalities of how GST and service tax will be calculated for the home buyers who are getting the house registered.

It said that a dedicated account would be made available in the UCO Bank Branch in the Supreme Court for the home buyers to deposit the due and unpaid amount. The details of this will be soon uploaded on the websites of NOIDA as well as Greater NOIDA Authorities.

The Supreme Court has also warned that the home buyers' unwillingness to pay the outstanding dues may lead to winding up of the stalled projects due to financial crunch.

If home buyers are not ready to pay their outstanding amount, then the projects would have to be bundled up, the court said, adding that if home buyers want construction to continue, then they would have to pay the outstanding money.

However, the Supreme Court stated that it would not allow “ghost buyers”, who had purchased flats at a nominal price to step in by allowing them pay the outstanding amount.

The court sought a response from the Raipur and Bhubaneshwar Authorities where Amrapali had purchased premium land and paid advances.

It has also asked a forensic audit of two other properties of the Group, Heartbeat City and O2 Valley to be conducted.

It may be recalled that on July 23, the Supreme Court had cancelled the Amrapali Group's Real Estate Regulatory Authority licence and appointed state-run NBCC to complete all pending projects.

The Supreme Court had observed that the group prima facie committed violation of the Foreign Exchange Management Act (FEMA) and other fraudulent activities, including money laundering, and recommended a thorough investigation by the Enforcement Directorate to identify the culprits.

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