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Noida homebuyers of ‘insolvent’ Jaypee explore legal, political options

The homebuyers agreed to meet Gautam Budh Nagar parliamentarian Mahesh Sharma, and Noida and Dadri legislators Pankaj Singh and Tejpal Nagar to help them out.

noida Updated: Aug 16, 2017 09:16 IST
Vinod Rajput and Vaibhav Jha
Vinod Rajput and Vaibhav Jha
Noida, Hindustan Times
Jaypee Infratech Group,IDBI Bank,National Company Law Tribunal
Hundreds of homebuyers assemble at Sector 15 A park in Noda to protest against Jaypee builders.(Sunil Ghosh/HT Photo)

Hundreds of homebuyers of Jaypee Infratech Group decided legal and political action on Tuesday after the private housing major in Noida teetered on the brink of insolvency.

Around 500 of them gathered at a park in Sector 15A to chalk out a plan after the National Company Law Tribunal admitted the insolvency petition filed by IDBI Bank against the debt-ridden Jaypee group.

The tribunal advised homebuyers, employees and creditors of Jaypee projects to file their claims before August 24.

“We fail to understand why buyers should suffer if a real estate developer fails,” said SK Nagrath, a retired army official and president of Jaypee Aman Flat Buyers’ Association.

The people agreed to meet Gautam Budh Nagar parliamentarian Mahesh Sharma, and Noida and Dadri legislators Pankaj Singh and Tejpal Nagar to help them out.

“We decided to meet the political representatives so that our issues are taken up in the UP assembly and Parliament. If the elected representatives don’t deliver, we will file a plea in the Supreme Court,” Nagrath said.

Lawmaker Singh assured support to the homebuyers.

“I have discussed the issue with chief minister Yogi Adityanath, who had asked authorities to act and do justice,” he said.

The people want their investment refunded amid growing fears that lawsuits will become ineffective if the company is declared insolvent.

“Our issues should be discussed in Parliament … why should buyers who have invested their life savings suffer?” said Vipin Kumar, another man who fears he will not get possession of his promised flat and lose his hard-earned money.

Panic spread among the homebuyers after the tribunal appointed chartered accountant Anuj Jain as “interim resolution professional” to settle disputes and he has taken over the Jaypee management. People are asked to file their claims with the professional.

The real estate sector has been suffering a slump, especially after the government scrapped high-value banknotes in a blitz against black money and corruption. This largely unregulated sector in India is often accused of hitching its fortunes to illicit funds and questionable transactions are said to be widespread.

Several projects have been delayed after developers diverted funds raised for one project to another, leaving buyers waiting for their homes.

The government is trying to clean up the business with a landmark real estate law designed to protect millions of homebuyers facing harassment because of limited legal options at times of dispute. But implementation of the law is delayed because of several reasons.

“The problem is that even the law has turned against us. They have recognised private banks as bigger creditors than homebuyers, which is unjust because we have a larger share. Now the fight is not just against Jaypee but the banks and the law itself,” said Krishna Mitroo, an army veteran and a homebuyer.

Besides, the lack of an umbrella union to fight for the homebuyers is making the task tougher.

“There are 30,000 buyers of Jaypee group and yet a few hundred turned up today. Some people are rich and live in western countries. It doesn’t matter to them … but we have put our savings in this project,” said Smriti Saroj, a buyer from Vaishali.

There were people like Saroj Yadav who dashed from Mumbai the day she heard the tribunal’s advice.

“I booked a two BHK flat in 2011 and waiting since then. I was in two-three protests. Buyers were agitated and frustrated with the builders before. Now they are scared and anxious.”

The people also decided to Noida chief executive officer Amit Mohan Prasad and ask him to ensure construction resumed in Jaypee housing projects.

He had apparently assured that their investments are safe and there will be no ban on registry or construction.

First Published: Aug 15, 2017 23:36 IST