Noida Authority to Challenge HC Order on Registering Lotus Flats, ET RealEstate

March 18, 2024

<p>File Photo</p>
File Photo

NOIDA: Noida Authority is planning to challenge an Allahabad high court order asking it to register flats in Lotus Boulevard Espacia and Lotus 300. The Authority said it was not in a position to execute registries because of the mounting dues of the builders.

In two separate rulings on Feb 29, the high court bench of justices Mahesh Chandra Tripathi and Prashant Kumar had asked the Authority to register flats in these projects in a month and a half and ordered an ED investigation against the builders.

“We are reviewing the court order and planning to either file a review in the Allahabad high court or an appeal in the SC. The Authority’s view is that it cannot leave its dues, as it is public money and is required for development purposes,” Noida Authority CEO Lokesh M said.

An officer from the Authority’s legal department said the HC had directed the ED to recover the amount from the developers and hand it over to the Authority but was silent on what would happen if the ED failed to recover the dues.

There are 168 homebuyers awaiting a registry of flats in Lotus Espacia. The housing society in Sector 100 was developed by a consortium – Cloud 9 Projects. Around 80% of the shares here were owned by developers Ashish Gupta and his brother Aditya Gupta, and their family. Promoters Nirmal Singh and Supreet Singh Suri of Three C company were the other stakeholders with a 10% share each.

The HC instructed the Noida Authority to issue the occupancy certificate (OC) and register the flats in the society within six weeks. It was also directed to recover over Rs 87 crore in dues from the developers by initiating recovery proceedings. For any amount that remained to be recovered, Noida was allowed to sell the unsold inventories in one of the towers of the project that was sealed by it last year. The ED was asked to investigate the financial frauds and transactions of the developers.

Following the court’s decision, the AOA of Lotus Espacia wrote to the Noida Authority seeking the registration of flats. AOA president Sudha Sharma told TOI they were yet to get any reply.

Sangita Singh, a former AOA president who is also waiting for the registry of her flat, said, “On what basis will the Authority challenge the HC order is beyond our understanding. The court clearly said Noida Authority cannot take advantage of its own wrong in not taking timely action against the promoters. Homebuyers have made all their payments and have been waiting for registration for years.”

In Lotus 300, the Authority was directed to issue an OC and execute registries within a month. The condominium has 336 flats of which nearly 250 have been handed over. The developers owe over Rs 160 to the Authority.

In March 2010, a consortium of Hacienda Project Private Limited (HPPL), with Pebbles Infosoftech as the lead member, was allotted 17 acres of land in Sector 107 for developing the residential project. At the time of the signing of the lease deed, Nirmal Singh, Surpreet Singh Suri and Vidur Bhardwaj were the directors of HPPL. In 2022, IndusInd Bank moved an application before the NCLT and a corporate insolvency resolution was initiated and an Insolvency Resolution Professional (IRP)was appointed.

The HC order stated since HPPL was facing insolvency proceedings, there was a moratorium under the Insolvency and Bankruptcy Code, 2016, and no proceedings could be initiated against the company by any creditors to recover their dues. It asked the Authority to submit its claims before the IRP. The HC also clarified the effect of the moratorium under the IB Code was confined only to the debtor company, HPPL, therefore, the promoters would to be liable to be prosecuted

Bhuwan Chaturvedi, AOA president of Lotus 300, said the registry of none of the 336 flats had been executed over the developer’s dues. “We have written to the Authority and to state govt. We met the Authority CEO and urged him to take a decision in the homebuyer’s favour. We are planning to meet the CM too,” he added.

  • Published On Mar 18, 2024 at 08:37 AM IST

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