A number of writ petitions were filed before the Hon’ble Supreme Court against the projects of various Companies of Amrapali Group in Noida and Greater Noida.
In 2011, various housing projects were launched in Noida and Greater Noida by Amrapali Group of Companies to construct approximately 42,000 flats and it was assured that the delivery of possession shall be made in approx 36 months.
According to Supreme Court, money of the home buyer was diverted and Amrapali Group was in violation of the Foreign Exchange Management Act (FEMA) and the foreign direct investment (FDI) norms.
It all started in April, 2013 when raids revealed that Amrapali was unable to complete any of its projects from 2009 to 2015. Later, a number of homebuyers took legal recourse against Amrapali for various issues primarily the issue of delay in projects. In October 2018, after Amrapali failed to hand over balance sheets of 46 companies to auditors, the court sent three directors of Amrapali- Anil Sharma, Shiv Priya and Ajay Kumar, to police custody.
To tackle the issue of delay in projects, the Supreme Court said it may give ownership rights of all the 15 prime residential properties of Amrapali to Noida and Greater Noida Authorities as it has failed to fulfil its obligations towards 42,000 home buyers. The court had then reserved its order on the question as to who will take over the management control and which builder/developer should finish the stalled projects of Amrapali. The Noida and Greater Noida authorities said they don’t have the resources and expertise to construct the stalled projects of Amrapali Group. The Apex Court then appointed National Buildings Construction Corporation (NBCC) to complete all the pending projects of the Amrapali group.
While deciding the case of Bikram Chatterji & Ors. v. Union of India & Ors. on 23rd July, 2019, the Supreme Court cancelled the registration of real estate major Amrapali group under the Real Estate Regulatory Authority (Rera) and lease of its properties granted by Noida and Greater Noida authorities. The SC further directed the Enforcement Directorate (ED) to investigate money laundering by officials and directors of the Amrapali Group.
Senior advocate R Venkataramani was appointed by the Apex Court as the court receiver in whom the rights of all the Amrapali properties will be vested after the cancellation of lease. In order to recover the dues, he will further have the power to enter into any tri-party agreement for sale of the group’s properties. The SC also asked Noida and Greater Noida to handover a completion certificate to the flat buyers who are already residing in various projects of the group.
Furthermore, the home buyers are directed to deposit the outstanding amount under the Agreement entered with the promoters within 3 months. The amount deposited by them shall be invested in the fixed deposit to be disbursed under the order of this Court on phase-wise completion of the projects/work by the NBCC.
The Apex Court has been strict in making its move to put an end to the unfair practices that the builders/developers adhere to in order to make money by cheating and duping innocent buyers.
Author – CA Ramesh Agrawal (FCA & LLB) Partner Agrawal Gupta & Sahu from Delhi and can be contacted at [email protected]