Several other big names in the real estate industry such as Amrapali, Jaypee Group and Unitech have also been taken to the bankruptcy court. Hundreds of homebuyers who had booked properties belonging to the three companies have been unable to find their homes, even after a decade, and the companies were facing many cases in the courts. The CAG observed that Noida’s authorities had weakened and changed rules to suit real estate developers and ignored the interests of homebuyers who had invested their savings. Despite repeated violations by these companies in terms of outstanding dues that accumulated to INR149 billion, the authority failed to take any action against them.” The Comptroller and Auditor General’s (CAG) report said: “Nearly 80% of the total allotment of plots in the commercial category between 2005-2018 were secured by three real estate firms named Wave, Three C and Logix Group. There were several irregularities stalling land allotment and development clearances due to a nexus between builders and Noida officials. Several homebuyers had been unable to get their units registered because of the developer’s pending dues with the Noida city authorities.
Logix’s project in the New Okhla Industrial Development Authority (Noida) was launched in 2011, and consists of 3,400 units spread across 14 towers, of which nine are incomplete. The homeowners were in a quandary as they were paying a pre-equated monthly instalment before receipt of the flats and, because they had taken loans, were being forced to pay those or risk huge penalties.Īfter Supertech, the NCLT initiated insolvency proceedings against Logix Blossom Zest, allowing a plea by operational creditor Colliers International (India) Property Services. The project is being developed at a cost of INR11 billion, and out of 38,041 flats, 27,111 were delivered to homebuyers. The mega realty developer had defaulted on a payment of INR4.3 billion (USD56 million) to Union Bank for construction of the company’s Eco Village II project in Greater Noida, in Uttar Pradesh state. The National Company Law Tribunal (NCLT) issued the order in response to a plea by Union Bank of India and a group of 100 homebuyers. When Supertech, one of the New Delhi-NCR region’s largest real estate developers, was declared insolvent on 25 March 2022, it sent shockwaves across the sector.
A spate of defaults at several prominent real estate companies has left creditors and homeowners on shaky ground, with several challenges awaiting them at the insolvency court, writes Vineeta Bansal