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  1. Here is why Amrapali promoters may be jailed

Here is why Amrapali promoters may be jailed

Expressing serious concern over the interests of homebuyers, the Supreme Court on Thursday warned the Amrapali Group to hand over flats of the Leisure Valley project on time, failing which its promoters will be sent to jail.

By: | New Delhi | Published: February 23, 2018 3:16 AM
Amrapali promoters, Amrapali Group, Supreme Court, Insolvency and Bankruptcy Code 2016 , Leisure Valley project, Ranjit Kumar, National Company Law Tribunal  On Wednesday, the Supreme Court asked the Amrapali Group to disclose details of its funds frozen after insolvency proceedings were initiated against the company. (Reuters)

Expressing serious concern over the interests of homebuyers, the Supreme Court on Thursday warned the Amrapali Group to hand over flats of the Leisure Valley project on time, failing which its promoters will be sent to jail. Permitting the builder to collaborate with 13 other developers, a bench led by Justice Arun Mishra said that it will monitor the progress of the project. It also asked the builder to submit an affidavit giving a timeline for finishing the remaining work of 19 towers of Leisure Valley, comprising 1,665 flats being built in Greater Noida, and also furnish details of the collaborators who will fund and give assistance to it. “Timely execution of work is important. Only upon the undertaking such permission will be given… we are concerned about the buyers’ interest. If the developer doesn’t keep the interest of the buyers and hand over the flats on time, we will send them to jail,” the Supreme Court said. It also sought an undertaking by March 7 from the three promoters to show bona fides that they are keen to deliver the flats in time.

Even a status report after a month is to be filed by the group to check the progress of the work undertaken by the builder and the collaborators. The matter has been put for further hearing on March 27, the date when the apex court will also consider the status of other projects like Silicon City, etc. “In order to examine the credibility and progress of the project, one month time is granted. In between the information regarding the completion of the project and assurance to the home buyers has to be rendered by the builders,” the SC said. Meanwhile, Amrapali told the bench that its 10 projects consist of 10,647 flats. Of this, around 980 flats can be handed over between three-six months and 2,085 flats between six and nine months. The developer told the Supreme Court that 3,130 flats can be delivered within nine to 12 months and 4,452 flats within a year.

On Wednesday, the Supreme Court asked the Amrapali Group to disclose details of its funds frozen after insolvency proceedings were initiated against the company. “Our ultimate concern is that homebuyers should get their flats as early as possible,” the bench stated. Senior counsel Ranjit Kumar, appearing for the builder, told the bench that the firm would need Rs 130 crore to finish work on the 47 towers, but said he would furnish precise details by Thursday. The bench will hear the matter again later in the day.

Buyers of Amrapali flats had moved the top court in October 2017 saying that despite assurances that the flats will be handed over in three years, 10 years had passed during which they had already paid 90% of the cost of flats, but the developer had failed to deliver the flats.

The apex court is hearing a clutch of petitions filed by flat buyers who have demanded reversing of the September 4, 2017 National Company Law Tribunal order. They claimed that the provisions of the Insolvency and Bankruptcy Code 2016 violated their fundamental rights as they prioritised lending institutions. The Amrapali Group has claimed that work on the incomplete towers would be completed in 14 to 16 weeks. “We can ask them to deposit the money in the court-monitored bank account, and that fund will be given to you only after the developer finishes the work in the 47 towers,” the court said.

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