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Only 10% Amrapali flats handed over to buyers, SC told
Only 4,981 of the approximately 46,000 Amrapali homebuyers have received possession of their flats in the three years since Supreme Court entrusted the developer’s unfinished projects to the state-owned NBCC (formerly National Building Construction Corporation) in July 2019
Only 4,981 of the approximately 46,000 Amrapali homebuyers have received possession of their flats in the three years since Supreme Court entrusted the developer’s unfinished projects to the state-owned NBCC (formerly National Building Construction Corporation) in July 2019.
Promising that all 46,575 homebuyers of Amrapali will get their dream house for possession by the year 2024, the NBCC told the Supreme Court on Wednesday that a serious cash crunch has affected construction work, as, till October 7, the company received only ₹3,120 crore from all available sources against an estimated project cost of ₹9,296 crore.
The submission by NBCC was made before a bench comprising Chief Justice of India (CJI) Uday Umesh Lalit and justice Bela M Trivedi that was hearing an application for sale of unused available space in Amrapali projects as an immediate measure to fetch funds to the tune of about ₹1,500 crore.
Reserving orders on the application moved by court-appointed Receiver and senior advocate R Venkatramani, who is currently the Attorney General, the bench wished to know how much funds were available and the projected time for completion of the housing units.
Senior advocate Sidhartha Dave, appearing for NBCC, said, “When the project was entrusted to us, we had over 46,000 flats to complete. So far, we have handed over possession of 4,981 units and 6,877 more flats are complete, but require external services, such as electricity, water, etc.”
Stating that the lack of funds was holding up construction work, Dave said, “Till October, we spent ₹400 crore in excess of ₹3,120 crore that we received. We plan to construct and hand over another 11,858 flats by December this year and our target is to complete the remaining 25,400 flats by the year 2024.”
Supporting the application of the Receiver for the sale of unused open area available in Amrapali projects, known as “floor area ratio” or FAR, Dave said, “Our target to complete construction by 2024 is subject to the availability of funds. The sale of FAR is the quickest option to get money.”
Venkatramani told the court that in six of the 22 housing projects of Amrapali, certain area within the society which is lying as unused FAR can be sold for commercial use to third parties, and can fetch close to ₹1,500 crore. He said that offers in this regard have come from interested parties outside Delhi.
However, this proposal was opposed by homebuyers represented in court by advocate ML Lahoty. “The homebuyers have paid approximately ₹1,513.44 crore of the total of ₹3,624.65 crore required from them as per the payment schedule fixed by the court,” Lahoty said, adding that a lot remains to be done by NBCC, because despite receiving over 30% funds till date, it has managed to deliver possession of only 10% flats.
Lahoty submitted that the unused FAR sought to be sold is meant for common facilities such as tennis courts, jogging tracks, amusement facilities, nursing homes, schools, etc. “They may sell the unsold housing units but if construction takes place on unused FAR, green area and other facilities available to residents will be taken over,” Lahoty submitted.
The bench asked Lahoty, “Those who want to enjoy these facilities should be willing to pay 15% extra. You don’t want to sacrifice anything and when somebody is making an honest effort to find a solution by bringing some finance to help complete flats, you do not give consent for hiring off a portion of your area.”
Terming this to be a typical “commuter and bus mentality” where the commuter inside the bus does not want anyone to board the vehicle, the bench came down hard upon homebuyers, saying, “You sit in an exalted position and expect that the court, the Receiver and NBCC should get funds to complete your project. But as a stakeholder, you are not willing to put in any money.”
The objection to the sale of FAR also came from the Noida and Greater Noida authorities. Senior advocate Ravindra Kumar, appearing for the land-owning authority, told the court that instead of selling the unused area, money can be generated by constructing pending residential towers for which permission has already been granted. “Already there are dues payable by Amrapali towards land lease. Any further construction on unused FAR will require the consent of homebuyers,” Kumar said.
The bench told Noida authority, “We have noted that this problem is only witnessed in Noida and Greater Noida and not in any other place in the country. That is because of your policy to grant plot to builders on payment of 10% upfront amount of total lease money. You have allowed this so to a certain extent, whatever consequences are there, you must be generous in taking some loss.”
The court has been monitoring the construction of the Amrapali housing projects. In this regard, the project has received a fund of ₹650 crore from the government-sponsored Special Window for Affordable and Mid-Income Housing (SWAMIH) Investment Fund and an approval for an additional sum of ₹1,500 crore from a consortium of seven nationalised banks.
Justice Lalit, who demits office on November 8, has been associated with the Amrapali case hearing since March 2018. He was also part of the July 23, 2019 judgment that cancelled Amrapali’s licence under the Real Estate (Regulation and Development) Act following disclosures during a forensic audit that found that the company’s directors diverted money of homebuyers to shell companies abroad and to acquire personal wealth.
Wednesday, the last hearing in the case he presided over, justice Lalit thanked all lawyers for their cooperation and agreed to give the judgment on the sale of FAR issue on Monday.
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