Suffering huge losses due to order capping interest rate on dues of builders: Noida tells SC

  • | Monday | 20th September, 2021

New Delhi, Sep 20 (PTI) The NOIDA authority on Monday told the Supreme Court that it is suffering huge losses and its functioning have virtually come to a standstill due to the top court"s last year orders directing it to cap the rate of interest at eight per cent on the dues for land given on lease to different real estate companies.It alleged that different builders have suppressed the facts from the court leading to the passing of June 10 order favouring the real estate companies in Noida and Greater Noida areas.A bench of Justices UU Lalit and Ajay Rastogi was told by advocate Ravindra Kumar, appearing for Noida authority, that the court by its order dated June 10, 2020 has curtailed the interest charged by the authority from the year 2010 onwards, under contracts entered into by it with builders and under which large tracts of lands belonging to the state have been made available for private exploitation by builders.Kumar said that it is being said that Noida authority had argued the matter before passing of the order but the fact of the matter is that a builder (Ace Group) on whose plea the order was passed, had colluded with lower rank officials and no notice was served upon the authority as a result no proper response was filed to the petition.“The applicant respectfully submits that the orders of this court were made in circumstances where the applicant was unable to place its defence in the court to the far-reaching financial impact that would result from the orders passed by this court. The applicant very respectfully submits that it is in the interest of justice that the orders be recalled and the matter heard a fresh”, Kumar said.He also pointed out that it was not a case that many builders were involved in the matter as at the time of order only Ace Group was before the court and Panchsheel builders and Supertech Group came before the court at a later stage.The authority further submitted that the Ace Group suppressed the facts on land interest rates, default in paying lease premiums while the company itself charged 18 per cent compound interest from buyers and the fact they had already delivered a couple of projects even before the Amrapali case was filed in 2017.Kumar said that the builders charge 18 per cent interest while authority used to charge 11 per cent compounded annually payable in easy instalments but they were penalised.He said that the authority"s working is at standstill and bearing huge losses in view of the order as now several commercial, individual, institutions are approaching the authority seeking re-settlement of dues in view of the eight per cent cap imposed by the top court.Kumar said that on June 9, 2020, considering the problems in cash flow created by the pandemic and its aftermath, the state government had directed a reduction of the interest being charged by the authority but this reduction in interest rates was only to apply prospectively and there was no question of refunding any interest already recovered, or reducing past demands of interest.The top court posted the matter for further hearing on October 1.At the outset, the court appointed forensic auditor Pawan Kumar Aggarwal in the Amrapali matter, said that as per last directions of the court he has filed a report in sealed cover.The bench asked Aggarwal to share the copy of his report with the Enforcement Directorate (ED) which has attached properties worth Rs 4.79 crore of Prem Mishra, a former director of Amrapali Group accused of diverting home buyers money through shell companies. Aggarwal has raised objection to the ED’s finding and said that Mishra had diverted more than Rs 10 crore of home buyers" money from the Amrapali Group.The top court had then directed Aggarwal and ED to sit together and sort out the ambiguities if any in calculation of the amount.The bench said that it will take up the matter on October 5 and would like to have responses of ED, home buyers and Mishra on the findings of Aggarwal.On September 13, the ED had said that it has attached properties worth Rs 4.79 crore of a former director of Amrapali Group and is probing his transactions of diversion of home buyers’ money made through shell companies.It had said that the attached properties were proceeds of crime of Mishra, who being a director has raised the amount by diverting home buyers money from Amrapali Group with the help of fake invoices, bills and sham transactions.On September 3, the top court had warned the flat buyers of Amrapali Group who are not clearing their dues as per the payment plan to not be in any kind of delusion as their units can be cancelled and will be considered as unsold inventory.The NBCC had earlier told the top court that at present, 10 projects in Noida and 12 projects in Greater Noida are under execution involving 45,957 units with sanctioned project cost of Rs 8025.78 Crores.On August 14, the top court had initiated a process to cancel bookings of over 9,538 Amrapali project flats, which are unclaimed or booked in the name of fictitious people or are benami property, to fund stalled projects.The apex court in its July 23, 2019 verdict had cracked the whip on errant builders for breaching the trust reposed by home buyers and ordered the cancellation of the registration of the Amrapali Group under real estate law RERA, and ousted it from prime properties in the NCR by nixing the land leases.Amrapali Group directors Anil Kumar Sharma, Shiv Priya and Ajay Kumar are behind bars on the top court"s order. PTI MNL MNL RKS RKS

If You Like This Story, Support NYOOOZ



Your support to NYOOOZ will help us to continue create and publish news for and from smaller cities, which also need equal voice as much as citizens living in bigger cities have through mainstream media organizations.

Stay updated with all the Delhi Latest News headlines here. For more exclusive & live news updates from all around India, stay connected with NYOOOZ.

Related Articles