3 Builders To Work With Amrapali To Complete 12 Projects

3 Builders To Work With Amrapali To Complete 12 Projects

3 Builders To Work With Amrapali To Complete 12 Projects
Amrapali Grand in Greater Noida. (PropTiger)

On April 17, the Supreme Court (SC) refused to grant homebuyers’ their wish ─ the lawyer appearing on their behalf pleaded those running the company be sent behind the bars to ensure justice. In the opinion of the SC, such a move would not be a solution to homebuyers’ problems who must, by all means, get the possession of their units for which they have already paid a substantial amount.

Pursuing that goal further, the top court on May 2 warned the company of “serious consequences” if it failed to install basic amenities such as elevators and fire safety equipment in projects where units had been handed over.

“If elevators are not installed then you will be in trouble. Let it be made functional by Monday (May 7). Non-compliance of our order could attract serious consequences. We have been very lenient to you so far. But, we will not spare anyone,” the SC said on May 2.

While stating that it ends to solve the jigsaw puzzle the company has created, the top court made it clear it would not “throw homebuyers in a frying pan”, and asked Galaxy Group to prove its credential before it could grant the Noida-based realtor the permission to co-work with Amrapali to complete projects.

On May 17, Galaxy, IIFL-Viridian and Kanodia Cement were granted the top court’s permission to help the insolvency-hit company complete 12 projects in a matter of 6 to 48 months.

While Galaxy Group will help Amrapali complete six projects, including Saphire-I & II, Leisure Park, Leisure Valley, Eden Park, Green Valley and Heartbeat City, Kanodia Cement will help it build Princley Estate project. IIFL-Viridian consortium would work with Amrapali to complete five projects, namely Zodiac, Platinum, Tech Park, Golf Homes and Centurian.

The SC has also directed Amrapali to deposit Rs 250 crore in four weeks in an escrow account. This money will be paid to co-developers on completion of the projects. While asking those buyers, who are seeking refund to file an application by next months, the SC posted the matter for further hearing on July 18.

Tracking the money trail

During the hearing on April 11, the company told the apex court that it would need Rs 2,000 crore to complete nine projects in Noida and Greater Noida – this is the area where the company was frantically launching new projects. These estimates were worked out after joint teams of homebuyers and company officials visited project sites on the direction of the apex court. Responding to that, the SC asked the company to give details of the money it collected from homebuyers while elaborating how much of this fund was used to complete housing projects.

"Few facts are still missing. How much money remains to be paid project-wise? Please give a chart. How much money has been invested in projects? How much was collected? How much money is required? We want to know if there is siphoning of money, and we also want to know if there is the liability of the buyers," the SC said.

While five of these projects are located in Noida (Sapphire, Eden Park, Zodiac, Silicon City-I, Silicon City-II), four are in Greater Noida (Centurian Park, Leisure Park, Gold Homes and Verona Heights).

When work on all five projects in Noida is complete, 6,917 units will be delivered. Similarly, when work on the four projects in Greater Noida is complete, the company will be able to deliver 2,753 apartments. In total, the trouble-hit company has 43 housing projects in various stages of construction.
It is worth mentioning here that in some of the Noida projects possession has already been handed over despite the fact that proper infrastructure is not in place as yet — the fire-fighting system, the lifts, the water supply, the sewage system, the power backup system, the parking lots, CCTVs, etc., are missing.
In fact, the Uttar Pradesh Power Corporation Ltd had in March stopped power supply to four of Amrapali's Noida projects over pending dues worth Rs 5 crore. The projects where power supply has been halted include Silicon City, Platinum, Zodiac and Princely Estate.

Since finishing all projects simultaneously was not possible owing to monetary concerns, the company would apply a one-at-a-time approach, it informed the SC – the apex court has also decided to deal with each project separately.

"The court had asked us to complete tower by tower and project by project. We cannot do it in one go unless cash flow is there," the lawyer appearing for the company told the SC.

The company had earlier said that it was not in a position to complete the projects on its own, and needed outside assistance to do so.

No end of trouble

At a time when the company is facing public ire over its failure to deliver as many as 42,000 units and its sister concern is staring at insolvency proceedings, cricket star Mahendra Singh Dhoni has sued Amrapali for non-payment of Rs 150 crore. Dhoni had been endorsing the real estate company for the past seven years and severed his ties with the company in April 2016 after being trolled by homebuyers. While the relationship lasted, Dhoni was promised a villa worth Rs 1 crore by Amrapali in its Dream Valley project after Team India won the World Cup in 2011. Dhoni was the skipper of the team at that time. Other team members were also promised independent villas worth Rs 55 lakh each. As has been the case with homebuyers, the delivery of the promised units did not take place.

How the story unfolded

The SC, on October 27, sought the response of Amrapali on a plea filed by around 700 homebuyers, who had booked their homes in its projects. A Bench comprising Chief Justice Dipak Misra and Justices A M Khanwilkar and D Y Chandrachud issued a notice to the real estate company and said it had already restrained the company promoters ─ Anil Kumar Sharma, Ajay Kumar and Shiv Priya ─ from leaving the country without its permission.

On October 13, the SC had issued a notice to the Amprapali Group, its promoters and the Ministry of Finance on another petition filed by homebuyers, and asked the promoters not to leave the country without its permission.

The lawyer representing the buyers told the court investors had neither received possession of their flats nor the refund.sed land bank of 35 million square foot, and Rs 4,300-crore fund collected from buyers.

Also read: Your Developer Is Going Insolvent? You Can Claim Your Money Back

The earlier plea, by the Amrapali Silicon City Flat Owners Welfare Society, was filed against an order of the National Company Law Tribunal (NCLT) that admitted Bank of Baroda's insolvency petition against Amrapali's Silicon City project in Noida in Uttar Pradesh.

The apex court also directed that senior advocate Shekhar Naphade along with Advocate on Record Shubhangi Tuli will participate in the meetings of the Committee of Creditors under Section 21 of the Insolvency and Bankruptcy Code, 2016, to ensure the cause of the homebuyers and protect their interests.

Crisis scale

The group has a standing liability of Rs 1,000 crore to about 10 banks. Additionally, the group owes about Rs 3,000 crore to Noida and Greater Noida authorities, the two areas where the group has the highest number of residential projects. Also, it would require about Rs 3,000 crore to complete its various ongoing projects.

On the bright side, Amrapali has a licensed land bank of 35 million square foot, and Rs 4,300-crore fund collected from buyers.

Also read: Jaypee Insolvency: SC Directs Developer To Deposit Rs 2,000 Cr By October 29

The grand spread

Here is a snapshot of the various projects of the group in the national capital region, as mentioned on its official website:

Completed projects

Among the completed projects of the group are:

Noida

Greater Noida

Ghaziabad

With inputs from Housing News

Similar articles

@@Wed May 23 2018 19:58:22