The matter involving incomplete Amrapali Real Estate projects came up for consideration again before a Supreme Court Bench comprising of Justices Arun Mishra and UU Lalit on Friday, where a number of aspects were discussed and certain orders were passed. They include the following:-
- Funding of Project by SBI Capital
Senior advocate Harish Salve appeared for SBI Cap and informed Court that most issues had been ironed out in consultation with the Court Receiver, and sought a few more weeks to submit a final plan after assuring that the progress was promising. It was also brought to the Court's notice that 8 projects had been identified and shortlisted by SBI Cap.
Justice Mishra agreed to grant 3 weeks' time and asked Mr. Salve to come up with a crystalized final proposal.
Senior advocate ML Lahoty, representing the homebuyers, however, pointed out that the 12% rate of interest quoted by SBI Cap would be too exorbitant, which would burden the homebuyers. Thus he suggested that the rate of interest be considered to be in line with RBI's rate. As the Receiver also endorsed this point, the issue is still kept open, while SBI Cap must now submit its final proposal on August 4.
- Payment of Dues to Noida/Greater Noida Authorities
The Court modified its previous order regarding rate of interest which would apply for lease holders to work out the due amount. Senior advocate Mukul Rohatgi, appearing for the Greater Noida Authority, and Solicitor General Tushar Mehta, appearing for the Noida authority, suggested that the 8% interest rate, as ordered previously be made prospective. It was further pointed out that the Government had specified the rate at the SBI Lending Rate, to be paid, according to which the payable dues come up to 8.5%. Considering the submissions, the Court directed that marginal Cost of fund-based Lending Rate (MCLR) would apply uniformly to all lease holders.
"…we are of the opinion that SBI MCLR Rates to be applied uniformly to all the lease holders. Their past dues as well as arrears to be worked out accordingly. In case any adjustment is to be made, let the adjustment be made accordingly and the current dues also to be worked out at the SBI MCLR Rates. Future dues be also worked out at the SBI MCLR Rates, which may be fixed. Remaining order is not modified. The only modification made is about the rate of interest", states the order.
It has also been directed that the Noida/Greater Noida Authorities must work out the dues within a month, pursuant to which 25% of the dues must be deposited within 3 months. The remaining amount must be deposited with a year from the date of the Order, added the Court. Any failure to do so would result in the concessional rate of interest being withdrawn.
- Bank Financing
The Receiver informed the Bench that despite numerous attempts to contact Banks, none of the banks have shown promise in responding with regard to the disbursement of loans to homebuyers, as per the Court's previous two Orders.
Taking note of this, Justice Mishra stated that banks must take up issues related to disbursal of loans, restructuring of the loan, EMI liability and subvention loan agreement without delay. The Court thus ordered the Receiver to direct the CMDs of all banks to comply with the Orders of the Court.
"A request has been made by the learned Receiver to direct the CMDs of all the banks concerned to attend to the issue and issue appropriate directions for disbursal of the loan and restructuring in terms of the orders passed by this Court on time bound basis.
Let the CMDs of the concerned Banks do the needful and issue appropriate directions to the concerned Banks in the spirit of the aforesaid two orders which have been passed by this Court. Banks also to consider the application for grant of fresh loans and loan disbursal will not be confined only to the discontinued loans, it is also made clear."
The Court also took on record the statements made by Indian Overseas Bank, SBI and HDFC Ltd., that they were working on complying with the aforementioned orders within 10 days.
- Payment of Dues by Home Buyers
The Court also directed homebuyers to pay their due obligation in keeping with the terms of the payment schedule made by NBCC.
The Court Receiver submitted that NBCC has charted out a Project Execution Schedule and that tenders need to be issued. Thus, he requested that homebuyers may be directed to make payments according to the fund flow requirement of NBCC.
The Schedule is to be uploaded by the Receiver, while the interest aspect of defaulting buyers will be taken up at a later stage.
- Interference by Home Buyers
As the Court Receiver informed the Bench of several communications by home buyers to him as well as to NBCC seeking priority for their towers to be completed first, Justice Mishra directed buyers to show restraint and ordered that no home buyer should cause interference in the work of NBCC.
"…with respect to Amrapali Zodiac Social Welfare Association, it was also pointed out that regular interference is being made by the homebuyers so as to complete the particular flat earlier in point of time and the progress of the work is hampered in the process. We restrain all the home buyers not to interfere in the progress of the work in a systematic manner as decided by the NBCC."
- Investigation of FIRs Against Amrapali
Noting that that various FIR has been filed against Amrapali in different jurisdictional police stations, the Economic Offences Wing (EOW) has been asked to investigate all the cases. All concerned police stations must forward the FIRs to the EOW, as the Court was of the view that only all investigations must be carried out by one agency.
While hearing the application in which EOW had sought clarification, Justice Lalit had also stated that all matters should be looked into by the Enforcement Directorate (ED).
- Payment to Security Agency
Upon request from the Receiver, Supreme Court authorized him to make payments to the security agency hired to watch over assets in Greater Noida after due verification of bills.
- Reserve Fund For NBCC
The Received had also requested for a Reserve Fund to be worked out by the Union Finance Ministry, in order to provide a guarantee to the NBCC. The Court directed the Receiver to sit across the table with the Finance Secretary and concerned authorities to work out the feasibility and modalities of the same, and place the developments on record.
In addition to the, DHFL submitted that it had disbursed Home Loans to 400 homebuyers, and despite undergoing insolvency proceedings, they were willing to disburse funds to 311 of the defaulting beneficiaries.
Though it was stated that the remaining 89 may be problematic due to their Non-performing Assets, DHFL informed Court that they would look for a solution and get back in due course. Justice Mishra agreed that they may take till the first week of August to decide.
The ED also informed Court that, according to the previous Order, JP Morgan had transferred total of Rs. 187 Crores (RS. 140 cr + Rs. 47 cr interest).
The matter will now come up for hearing next on August 4, 2020.