Cancelation of lease deed for Amrapali
On 23 July 2019, the Supreme Court asked the government to take strict action against all the aberrant builders and to cancel their lease deed, if any illegalities are found. The court laid emphases on delivering of the project on time and made an example of failing real estate major Amrapali for diversion of thousands of crores of hard-earned funds of homebuyers.
The court bashed the company for using the home buyers’ money to fund its promoter’s lavish lifestyles such as buying expensive cars and villas. Court further cancelled the company’s RERA license, lease deeds and handed over the unfinished projects to NBCC.
The court prohibited the banks and Noida authorities from recovering any dues owed to the company from home buyers.
Home buyers cannot be held accountable for such mess
The court said home buyers cannot be held accountable like this; further the court ordered an ED probe into the money-laundering which it said could not have taken place without the knowledge of both the authorities and banks.
Amrapali will also face a FEMA probe and on which ED will submit quarterly reports to the court.
This action came after looking into the forensic audits of the company’s book that showed a huge amount of rerouting of funds and other illegalities.
The court said that the banks and authorities can collect their money from assets created by the promoters from the fiddle of funds and other guarantors but not from the home buyers or the projects for which they had paid for.
Court asked regulatory authorities and government to work together
The court asked the regulatory authorities and government to act together and take action against all the builders who haven’t finished their projects yet.
If the company fails to pay their dues and complete their projects on time, their lease deeds should be cancelled. RERA must ensure that all these projects are completed on time.
Justice Arun Mishra and Justice Uday Lalit’s ruling gave a huge relief to the troubled flat buyers of Amrapali who fought a long battle of 10 years in court to get justice.
Senior advocate ML Lahoty welcomed the order who lead the fight for 45,000 flat owners in Amrapali projects in Noida and Greater Noida. It would clean up the mess in the real estate sector and discourage other builders from taking home buyer’s money for granted, he said.