[ecis2016.org] The Supreme Court has warned embattled real estate major Amrapali Group that ‘each and every property’ of the managing directors and directors of the firm would be sold, to recover the cost of construction of its pending real estate projects
Do not play smart, or we will render you homeless. This was the Supreme Court’s categorical warning to real estate major Amrapali Group, which is accused of delaying its projects to the detriment of home buyers’ interests. The top court said that it would not allow the company to collect money from the hassled home buyers. “The real problem is that you have delayed giving possession of homes. Don’t try to play smart, or we will sell each and every property of yours and render you homeless. You (directors) will have to look for your houses, like you are making others wait for their homes. We will sell each and every thing of yours,” a bench of justices Arun Mishra and UU Lalit said.
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The bench got annoyed, after the Amrapali Group submitted a proposal to sell commercial properties worth Rs 400 crores, as against the expected cost of Rs 4,000 crores, to be incurred in completing its pending projects. “You are giving us a proposal of just Rs 400 crores, against the expected cost of Rs 4,000 crores for completion of pending project. You are actually acting smart. When you are before the court, you have to be sincere and upright. The day is not far, when you will compel us to sell your properties,” the bench said.
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It observed that people who had invested Rs 50 lakhs in 2008 for a property, was now valued at Rs 2.5 crores and those who invested Rs one crore, that property was now worth Rs four crores. It sought details of immovable and movable properties of managing directors and directors of the company, along with their valuation report, within 15 days. The top court asked the real estate firm to file a concrete proposal by August 14, 2018, for raising Rs 4,000 crores by selling its properties, for completion of its pending projects by the National Buildings Construction Corporation India Ltd (NBCC). It asked the Amrapali Group to furnish, on affidavit, the details of all bank accounts of each director and the group companies operational since 2008, the names of directors who are serving or have left the company and the names of two companies whose accounts do not reflect any business transaction, within 15 days.
During the hearing, advocate Gaurav Bhatia, appearing for Amrapali, said it can raise Rs 6,119 crores, including Rs 5,112 crores dues from home buyers and the remaining from its unsold inventories. To this, the bench said it would not allow the Group to collect money from the home buyers and it was actually the firm, which should pay them, for delayed possession of flats. “We have already given the pending projects to NBCC and we will not go back on that decision. It will start work by next month. You have to submit a concrete proposal, for selling of the properties for raising funds. NBCC can’t construct from air,” the bench said.
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Bhatia said the commercial properties in its Silicon City project and others, can generate around Rs 406 crores. Advocate ML Lahoti, appearing for the home buyers, submitted a note, giving details of the projects of Amrapali and said the Group has shopping malls at Bareilly in Uttar Pradesh, Purnia in Bihar, hotels and resorts at Muzaffarpur in Bihar, Deoghar in Jharkhand and Udaipur in Rajasthan, which could be sold and funds raised for construction of the pending projects. The bench asked the Group to furnish the details of unencumbered properties, which could fetch good price on sale within a fortnight.
It also sought comprehensive details of companies, which have been engaged in maintenance work in Amrapali projects and how much money they had collected, towards electricity and maintenance charges from residents and the amount spent so far. The bench’s direction came, after it was informed that electricity supply of two projects – Zodiac and Silicon City – at Noida have been cut off, on account of arrears of Rs 2.23 crores. It directed the power companies to restore the supply of electricity to the two projects immediately and said that their arrears will be paid. The court also dispensed with the arrangements of two interim resolution professionals, who were in charge of Silicon City and Zodiac projects, after the Amrapali Group got involved in insolvency proceedings. The bench listed the matter for further hearing on August 14, 2018.
The NBCC had, on August 2, 2018, told the apex court it was ready to undertake the projects of the Amrapali Group, which had failed to hand over possession of flats to around 42,000 home buyers. The top court had earlier cracked the whip on the Group, for playing ‘fraud’ and ‘dirty games’ with the court and ordered attachment of all the bank accounts and movable properties. of 40 firms of the real estate major.
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