SUPREME COURT BRINGS RELIEF TO OVER 6,000 HOMEBUYERS

The Supreme Court has brought relief to almost 6,000 homebuyers in the Unitech project and has asked the Noida Authority to greenlight the constructions that were earlier stalled.

The bench, comprising the chief justice of India, DY Chandrachud, Justice Manoj Misra, and Justice JB Pardiwala, held that the interests of several homebuyers were at stake, who are finding themselves in a precarious situation since their investments were embezzled by the former directors of the company. They empathized with the lurch the homebuyers find themselves in and hence asked the authorities to resume the construction of projects in sectors 96, 97, 98, 113, and 117.

Around 15,000 residential units are scheduled for completion across 10 real estate ventures spanning Noida and Greater Noida. Buyers have already committed significant amounts, totaling in the tens of lakhs, towards properties that have not yet been handed over by the company. In 2020, due to extensive financial misconduct, government-appointed officials assumed control of the company’s board.

The decision was made based on a proposal from the government-appointed board overseeing Unitech, which suggested building and selling new flats. Additional Solicitor General N Venkataraman, representing the board, highlighted that construction costs have exceeded ₹11,000 crore and approvals are required to complete flats, sell unsold inventory, and utilize vacant land.

Meanwhile, Ravindra Kumar, the lawyer for the Noida authority, mentioned that Unitech has surplus funds, including ₹8,000 crore from unsold flats and ₹3,200 crore from awaiting homebuyers. However, he rejected Unitech’s request to use vacant land within its designated area, stating that the company already had sufficient funds from unsold inventory sales and excess money from homebuyers.

Unitech’s previous leadership faces serious allegations of deceiving homebuyers and engaging in money laundering, contrasting with the new board’s commitment to delivering 15,000 units within two years. The court will later deliberate on Unitech’s substantial outstanding debts to the Noida and Greater Noida authorities, totaling thousands of crores. Notably, the Noida authority alone is owed a staggering ₹10,000 crore. Recognizing the confidence displayed by homebuyers in the ongoing construction efforts, the court found it appropriate for the Noida authority to process applications for layout plans, building plans, and other necessary approvals without requiring upfront payment of dues.

“Money contributed by homebuyers must go into the construction of projects to give a sense of confidence and engender hope in flat buyers,” said the bench, which also included justices JB Pardiwala and Manoj Misra.

In a judicial decision, a panel led by Chief Justice of India Dhananjaya Y. Chandrachud emphasized that planning authorities must provide approval for updated building plans by May 31, encompassing all aspects of the project, including residential units and facilities.