India’s first Formula One track, Buddh International Circuit, sealed over pending land duesUpdated: Feb 14, 2020 21:23 IST
GREATER NOIDA: The Yamuna Expressway industrial development authority on Friday sealed Buddh International Circuit — India’s first and only Formula One track — as the Jaypee Infratech Limited failed to clear financial dues. YEIDA officials also said that the authority has also started the process to issue a global tender to auction the property to recover its dues.
The action comes one and half months after the Yamuna Expressway authority had cancelled the lease deed of 1,000 hectares of land to Jaypee International Sports Company.
“A team of officials sealed multiple gates of the motor racing circuit as the developer has failed to clear financial dues. We have sealed the Formula One circuit so that the Jaypee Group does not use the property for commercial gains. All the projects located inside the Formula One circuit remains sealed now. However, the security guards and others living inside the Formula One campus will continue to carry out their duties to safeguard the property,” said KK Singh general manager (projects), YEIDA.
Jaypee group had built the Buddh International Circuit (BIC) in October 2011. Designed by Hermann Tilke, BIC hosted the Indian Grand Prix from 2011 to 2013. The venue was removed from the F1 calendar in 2014. Jaypee developed several other sports facilities, including a cricket stadium and other associated buildings for F1 races, on the plot along the 165km Yamuna Expressway, which connects Greater Noida with Agra.
The decision to cancel the lease deed of 1,000 hectares land had been taken by the YEIDA board on December 21, 2019. Officials said that they decided to seal the property as the developer did not turn up to pay the dues.
“As the lease deed had been cancelled, the developer is not be able to sell, mortgage or carry out any sort of transfer of this property, as the company has lost ownership of this land. The ownership will now remain with the authority,” said YEIDA official, requesting anonymity.
Jaypee’s infrastructure projects have been mired in controversies, with around 6,000 homebuyers and investors struggling to get their units for several years. Jaypee Infratech Limited, the group’s infrastructure company, has been facing corporate insolvency proceedings since 2017. It has collected Rs 1,924 crore in funds by selling property to buyers.
The firm has failed to pay land dues to Yeida for several years now. The authority said it had issued several notices since March 29, 2017, demanding dues of around Rs 600 crore. It had also threatened to cancel the allotment of the 1,000 hectare-land parcel several times.
“We would challenge the YEIDA’s action in the appropriate court on the grounds that the lack of fulfilment of obligations on part of authority has come in the way of completing the project, whereas 90% obligations have been met by the company. The move by authority is regressive as the racing track infrastructure that hosted the F1 race, and had put India and the state of Uttar Pradesh on the global racing map, is being cancelled. Such a move will be detrimental to attracting investment in the country and the state. Jaypee has completed 90% of its obligations by way of depositing Rs 2,400 crores towards land payment till date. Further, the company invested Rs 2,000 crores towards construction of motor race track and other related developments such as cricket stadium, etc,” said a spokesperson for Jaypee Infratech Limited.