SC restrains Supertech Realtors from creating third party rights in ‘Supernova’ project

Counsel for Supertech said it would need some clarifications on the report of amicus curiae Rajiv Jain who recommended that in the interest of homebuyers, the court should not accept the one-time settlement offered by Supertech Realtors – a subsidiary of Supertech Group which is the erstwhile developer of Supernova project.

The Supreme Court on Wednesday restrained Supertech Realtors from selling or creating third-party rights over its Noida-based Supernova project, which is facing insolvency, while indicating it may soon consider a suggestion by the amicus curiae to replace the company board with a new one under a court-monitored resolution mechanism.

The bench posted the matter for October 8 and assured anxious homebuyers that the court would take responsibility if it appointed a committee to resolve the crisis.

A bench led by justice Surya Kant, and also comprising justices Ujjal Bhuyan and N Kotiswar Singh, posted the matter for October 8 and assured anxious homebuyers that the court would take responsibility if it appointed a committee to resolve the crisis.

“Once we appoint a committee, the moral responsibility is on us to see to it that it succeeds,” the bench observed, while allowing the Supernova Apartment Owners Association to join the proceedings.

Meanwhile, another association of homebuyers sought to favour the proposal brought by Supertech’s co-developer Parmesh Constructions, pointing out that the company has already pledged ₹20 crore while another ₹150 crore is sought to be brought in by the company.

Represented by senior advocate Gaurav Bhatia, around 250 homebuyers backed Parmesh’s reverse corporate insolvency resolution process (CIRP). However, both the National Company Law Tribunal (NCLT) and the appellate tribunal had earlier rejected the proposal after a consortium of banks led by Bank of Maharashtra refused to accept it.

The bench told Bhatia, “What objection can you have to a court-monitored process that has proved to be a success story in the past.” The court was alluding to the court-monitored process employed in completion of Amrapali and Unitech housing projects.

“If all cooperate, a committee can be put in place,” the bench said. “On three occasions in the past, we have not sent the Supernova project back to the NCLT realising that substantially this project is complete or partly complete. I think most of the homebuyers would not oppose it if there is a builder brought under court-monitored resolution mechanism,” it added

However, counsel for Supertech said it would need some clarifications on the report of amicus curiae Rajiv Jain who recommended that in the interest of homebuyers, the court should not accept the one-time settlement offered by Supertech Realtors – a subsidiary of Supertech Group which is the erstwhile developer of Supernova project. The company, however, told the court that it was willing to cooperate on the suggestions by the amicus.

Jain, who proposed a hybrid, court-monitored resolution mechanism as a way-forward in this case, informed the court that the appellant (erstwhile director RK Arora of Supertech Realtors) has not yet supplied documents to the interim resolution professional (IRP). He urged the court to pass orders restraining the company from dealing with the Supernova properties.

The bench ordered, “The appellant and his associates are restrained from alienating and/or creating third party rights in the subject property. The appellant is directed to cooperate with the IRP and provide full assistance/records, as may be required.” The court directed the soft copies of the records to be supplied to the IRP and to the amicus curiae.

The amicus was earlier directed by the court to consult all stakeholders and give suggestion on the possible way forward as it was faced with Arora’s petition challenging the August 13 order passed by NCLAT rejecting the one-time settlement proposed by Supertech Realtors to complete the project.

The amicus weighed all options of CIRP, reverse CIRP and court-monitored resolution and favoured the last choice citing the past success of Amrapali and Unitech housing projects. In Amrapali, court appointed a receiver to complete pending housing projects and appointed NBCC as the project management consultant for carrying out the construction work. In the case of Unitech, a government-appointed board was facilitated by court orders to get approvals for speedy completion of projects.

Jain had said that a “hybrid, court-monitored” mechanism under supervision of a former SC or HC chief justice would protect the interests of financial creditors while ensuring that thousands of homebuyers -- waiting for years for their flats -- are not left stranded.