This insolvency declaration, among other things, has made Greater Noida Authority powerless in terms of intervention (from the home buyers side).
After the bench of the National Company Law Tribunal (NCLT) declared Amrapali and Jaypee as insolvent companies, the plight of home buyers, who are struggling for possession, has worsened. This insolvency declaration, among other things, has made Greater Noida Authority powerless in terms of intervention (from the home buyers side).
Now, Greater Noida Authority has taken a decision of submitting a caveat — a notice, especially in a probate, that certain actions may not be taken without informing the person who gave the notice — to the NCLT. This would ensure that going forward NCLT cannot declare any real estate firm as insolvent without informing the Greater Noida Authority.
This move is particularly pertinent in the current scheme of things. According to officials of the Greater Noida Authority, developers of several projects in the area are not paying their bank installments, and their dues.
"There is a strong possibility that the banks shall soon file cases against the defaulting builders in the NCLT. As a safeguard these builders shall file insolvency petitions and a similar situation of helplessness will occur as Greater Noida Authority will then be rendered powerless.
"We have a right to question the builders operating in our area and hence we are submitting this caveat per which NCLT shall have to hear our verdict against the builders before declaring their companies insolvent," officials stated.
Greater Noida Authority officials also backed their decision of caveat submission with the logic that since the land for real estate projects are granted by them they become answerable to the buyers.
Bal Krishna Tripathi, additional chief executive officer of Greater Noida Authority, said that the authority is taking the help of legal experts. On August 10, the bank had moved NCLT to start insolvency proceedings against Amrapali Infrastructure, Silicon City and Ultra Homes under the Insolvency and Bankruptcy Code.
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