[ecis2016.org] Noida-headquartered Wave Megacity Centre has cited its inability to clear the dues of the Noida Authority as the reason for filing for bankruptcy
In a move that would jeopardise the plans of hundreds of residential and commercial investors who bet on Noida’s affordable realty, Wave Megacity Centre has moved the National Company Law Tribunal (NCLT), voluntarily seeking initiation of insolvency proceedings.
You are reading: Wave Megacity Centre files for bankruptcy
Noida-headquartered Wave Megacity Centre Ltd, which is developing commercial and residential projects in Noida’s sectors 25A and 32, has cited its inability to clear the dues of the Noida Authority, as the reason to initiate the step – The builder owes the Noida Authority Rs 1,222.64 crores. The builder moved its petition in the NCLT on March 26, 2021, after the Noida Authority seized around 1.08 lakh sq metres of land owing to the non-payment of the outstanding debt. On the same grounds, the Authority has also refused to execute sub-lease deeds for the completed flats.
The Noida Authority had allotted 6,18,952 sq metres of land to the builder in sectors 25A and 32, for a mixed land use project, in March 2011. The builder, which has received Rs 1,398 crores from the allottees, also has over 210 pending cases, where buyers have claimed refund over project delays.
“(The) Noida Authority’s abrupt decision to seal the residential-cum-commercial project in the prestigious Sectors 32 and 25, is an attempt to settle a commercial dispute through arbitrary means,” Wave Megacity said, in its petition.
The company said it was ‘working for the best interest of the buyers’ and moved the insolvency tribunal to initiate the voluntary resolution process under Section 10 of the Insolvency and Bankruptcy Code that permits debtors to initiate insolvency proceedings against itself, in case of a default.
“The board of directors of the corporate debtor have examined the financial situation and in order to keep the corporate debtor as a going concern, have approved/ resolved to file the application, to protect the interests of its creditors and stakeholders,” the company added, in its petition.
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In its petition to the NCLT, the company has shown a loss of Rs 875.62 crores in FY 2020 and a provisional loss of Rs 232.53 crores in the current financial year and said it did not have ‘adequate cash flow, to meet its obligation to the customers and financial lenders’.
The builder’s application, which has to be either admitted or rejected by the insolvency tribunal within 14 days of its receipt, is expected to be taken up by the Delhi bench of the NCLT. “The corporate debtor is unable to generate revenue from the sale/transfer of units and is also in default of its obligations to the allottees of the residential and commercial units, resulting in the corporate debtor not having the adequate cash flow to meet its obligation to the customers and financial lenders,” it said.
WMCC: Company and projects
Wave Megacity Centre (WMCC) is a special purpose vehicle by Wave Infratech for the said projects and does not have any investment into any other group company. It is currently developing housing projects, Amore, Trucia, Irenia and Vasilia and commercial projects High Street Shops and Livork Studio.
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