Amrapali Silicon City, Noida case: SC moves to protect flatbuyers, bars directors from going abroad

By: | Published: October 14, 2017 4:40 AM

The Supreme Court on Friday restrained the directors of the real estate major from leaving the country without its permission.

Amrapali Silicon City, Noida, Supreme CourtThe Amrapali group has liabilities of around Rs 3,000 crore towards the authorities and owes over Rs 1,000 crore to 10 banks.

In a batch of cases challenging initiation of insolvency proceedings against Amrapali Silicon City in Noida, the Supreme Court on Friday restrained the directors of the real estate major from leaving the country without its permission and also appointed amicus curie to safeguard the interest of flatbuyers.

A bench led by chief justice Dipak Misra, while seeking reply from the Centre, the insolvency resolution professional appointed by the National Company Law Tribunal (NCLT) and others, also tagged the fresh batch of petitions led by the Amrapali Silicon City Flat Owners Welfare Society with the matter.

The court also appointed senior advocate Shekhar Naphade and advocate Shubangi Tuli as amicus curiae to assist it and participate in the meetings and espouse the “case and cause” of homebuyers. The apex court allowed homebuyers to approach Tuli with their property details.
More than 150 flatbuyers have moved the apex court against an order of the NCLT that admitted Bank of Baroda’s insolvency petition against Amrapali Silicon City in Noida over a loan default of Rs 55 crore.

More than hundred homebuyers, who have invested in three different projects of Amrapali group, had requested the apex court to safeguard their interests by treating them as secured creditors such as banks and financial institutions.

The Amrapali group has liabilities of around Rs 3,000 crore towards the authorities and owes over Rs 1,000 crore to 10 banks. The company needs Rs 3,000 crore to complete its ongoing projects.

The petitions have sought enforcement of their fundamental rights that have seriously been abrogated by the provisions of the Insolvency and Bankruptcy Code 2016.

The petition also prayed for quashing of the NCLT’s September 4 order that had appointed an IRP to take over the company and ordered stay on all the court proceedings against the company, including those pending before the consumer courts, till the corporate insolvency resolution process is on.

The apex court had earlier taken note of a similar plea of hassled home buyers of Jaypee Infratech and had asked IRP to submit an interim resolution plan within 45 days and also asked its parent firm Jaiprakash Associated Ltd to deposit Rs 2,000 crore to safeguard the interest of its home buyers.

Stating that the NCLT order has a direct bearing on the home buyers of Amrapali Centurian Park, which is virtually owned by Amrapali Silicon City, the petition said that since both companies are run by almost same directors including Anil Kumar Sharma and Shiv Priya, the resolution process triggered in respect of Amrapali Silicon City cannot be viewed in isolation and divorced from Amrapali Centurian Park.

While Amrapali Silicon City, which is the 98.84% shareholder of Amrapali Centurian Park, has only one project in Sector 76 in Noida and has 1,000 flatbuyers, homebuyers of the latter’s three projects- Amrapali Centurion Park-Low Rise project, Amrapali Centurion Park-Terrace Homes and Amrapali Centurion Park-Tropical Garden in Greater Noida have moved the apex court.

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