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SC issues notice to Centre, Amrapali on plea against insolvency proceedings

More than 5000 flats were to be built in approximately 40 towers in a phased manner by the embattled group

Press Trust of India  |  New Delhi 

SC issues notice to Centre, Amrapali on plea against insolvency proceedings

The Supreme on Friday sought the response of the and two Group firms on a plea by over 100 hassled home buyers seeking that their interests be safeguarded by treating them as secured like banks and

A bench of Chief Justice and Justices A M Khanwilkar and issued notice to the central and the Group and asked them to respond within four weeks.


The home buyers, who have neither got possession of flats, nor refund of their hard-earned invested money, had booked homes in the Centurion Park-Low Rise project, Centurion Park-Terrace Homes and Centurion Park-Tropical Garden at Greater in

More than 5000 were to be built in approximately 40 towers in a phased manner by the embattled group.

The plea, filed by Bikram Chatterjee and 106 others, has sought quashing of a Tribunal (NCLT) order passed on the plea of Bank of Baroda seeking initiation of proceedings under the and Code, 2016 against Silicon City Pvt Ltd.

Consumer and recovery cases and decrees passed by civil courts and consumer fora in favour of home buyers against real estate firms cannot be executed once proceedings begin at the NCLT.

The plea has sought that either the home buyers are treated equally with banks and FIs, or the provisions of the code, which give priority to lending institutions, be held ultra vires to the Constitution as being violative of fundamental rights like rights to equality and life.

The petition, filed through lawyer M L Lahoty, alleged that the 107 home buyers had neither got possession of the property, nor any compensation from the firm.

It also alleged that the proceedings against Silicon City Ltd affected the home buyers of Centurion Park Pvt Ltd.

It claimed that thousands of buyers had booked apartments during 2010-14 by paying booking amounts running into several crores after which they were made to sign "one-sided" allotment agreements.

Detesting the terms and conditions contained in the agreement, the buyers alleged they were "oppressive and unreasonable" as there was a clause for timely payment by the buyer, but no timely completion of the project.

It claimed that the contract was one-sided as it allowed the builder to raise loan from any bank by way of of the being sold and buyers cannot object.

"Giving serious jolt to home buyers who have paid their hard earned and life savings into funding the purchase of their dream homes, the Respondents 3 and 4 (firms) were found in serious breach of their obligation to deliver the within 36 months, that is by 2013 and in some cases it is 2016," the petition said.

No compensation for this failure to deliver the had been paid to the buyers, it alleged.

The NCLT had on September 4

this year ordered liquidation of the builder on the plea of Bank of Baroda seeking initiation of the same under the Act.

Besides the two firms, the plea has made Union Ministries of Finance and Corporate Affairs, government, Bank of Baroda and the RBI as parties.

The plea has sought a direction restraining the Interim Resolution Professional (IRP) from creating any third party interest in the projects in question and safeguarding of financial interest of home buyers.

Earlier, the apex had taken note of a similar plea of hassled home buyers of real estate major Jaypee Infratech Ltd and revived the proceedings against the firm.

It had given the management control of the firm to the IRP, appointed by the NCLT, besides asking the firm to deposit Rs 2000 crore with the apex registry to safeguard the interest of the home buyers.

First Published: Fri, October 06 2017. 20:46 IST
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