‘Banks are hand-in-glove with builders and a CBI probe should have taken place.’
New Delhi: Jaypee Infratech’s former Chairman and Managing Director (CMD) Manoj Gaur had invited homebuyers for a “conversation” over delayed projects, at the Jaypee Business School on Friday, but at least nine registered associations decided to boycott any further discussions with Gaur. Associations, including Jaypee Kasa Isles Welfare Association, Jaypee Kensington Boulevard Welfare Association, Krescent Homes Buyers Welfare Association, Jaypee Garden and the Isles Welfare Association, among others, decided not to “fall into this trap” again.
Speaking to The Sunday Guardian, Parimal Tomar, president of Jaypee Kasa Isles, said, “It’s been 10 years that we have booked our apartments and there are around 22,000 projects which have been delayed for over 12 years. The current time limit under bankruptcy resolution is 270 days, so after the first term was over, the Supreme Court sent us to the National Company Law Tribunal (NCLT) and then the company went into liquidation. People are protesting because we believe that the CMD is trying to come back and take over the company again.”
While some of the buyers are doubtful as to how Manoj Gaur can reach out to buyers when the court has appointed an insolvency resolution professional (IRP) till the insolvency proceedings are in place, Anuj Jain, Jaypee Infratech’s Interim IRP, said, “There is no such restriction in law. The power of the board is temporarily suspended, but legally Manoj Gaur is still the director of the company. Only while the insolvency is going on, the board cannot take any decision. Moreover, there is a provision in Insolvency and Bankruptcy Code (IBC) which says if a settlement is reached between lenders, creditors and borrower, the court does not go into the merits of it and the case is withdrawn and a mutual settlement is reached. That is not a resolution plan, but a settlement. I believe he is trying to do that.”
With no relief in sight, Annu Khan, president of Noida Estate Flat Owner’s Main Association (NEFOMA), said, “Jaypee has at least 25,000 buyers and others, including Amrapalli and Unitech, have at least 1.5 lakh buyers who are caught in such a mess. This is only the case in NCR. The government just allots them time which makes them more reluctant towards completing the projects. Rules and regulations need to be tightened.”
Of the two construction companies, National Building Construction Corporation Limited (NBCC) and Suraksha Asset Reconstruction Company, people seem to have some faith in the former.
According to Jain, both NBCC and Suraksha have submitted plans and after discussions, submission of a revised plan has been requested by 25 April.
Speaking to this newspaper, a top NBCC source, who requested anonymity, said, “After the revised bid is submitted, the Committee of Creditors (CoC) can take a final call on who will acquire the debt-ridden Jaypee Infratech and complete their housing projects. As of now, we have no information on that.” Buyers also feel that the appointment of S.D. Meena as the new NBCC CMD, who is an Additional Secretary with the Ministry of Housing and Urban Affairs, will affect the case. He is the present interim chief of NBCC and being new to this responsibility, how he gives shape to the crisis is unknown, the source added.
Additionally, with Prime Minister Narendra Modi’s “Housing for All by 2022” Mission–National Mission for Urban Housing, it is all the more difficult for builders to escape legal accountability, the source said.
Speaking on this, Amit Khemka, a Delhi High Court lawyer, said, “IBC proceedings have become a fancy tool in the hands of these builders. Noida Extension property was given by the Noida Authority to the builder only upon the payment of 10% of the value. Rest 90% was supposed to be paid in the next 10 years, which means that the property itself did not belong to the builder. But banks started financing on those projects. These banks were hand in glove with these builders. It is a case where Central Bureau of Investigation (CBI)
investigation should have taken place.”
He also said that buyers believed what builders told them, they never bothered to consult a lawyer. “Both NBCC and builders will take their profit share, so allottees must be given the permission to take up the pending projects by forming a cooperative society,” Khemka added.
Asked about the deadline of delivery of projects, Anuj Jain said: “Jaypee is in a difficult situation. We are only professionals and there has to be proper investment. Unless we know from where the money will come, we cannot give an end date. That alone will determine how fast you are able to construct the flats.”
When this correspondent tried to contact Jaypee Group vice-president Ashok Khera, there was
no reply.