On Friday, February 22, the Supreme Court
issued a stay on the National Company Law Appellate Tribunal (NCLAT) order that
had permitted National Building Constructions Corporation (India) Limited
(NBCC) to take over and complete the pending real estate projects of Supertech
Limited. The Court also instructed all relevant stakeholders to present
alternative proposals for the completion of these projects.
The bench, comprising Chief Justice of
India Sanjiv Khanna and Justices Sanjay Kumar and KV Viswanathan, was hearing a
challenge against the NCLAT order, which had approved NBCC’s proposal to take
over the construction of 16 stalled projects belonging to Supertech Limited.
These projects, located in Noida, Greater Noida, and other cities, have left
over 50,000 homebuyers in a state of prolonged uncertainty, many of whom have
suffered significant financial hardships due to extended delays in receiving possession
of their homes.
The insolvency proceedings against
Supertech Limited were initiated by Union Bank of India, with NBCC subsequently
filing an application to undertake the completion of the projects as part of
the resolution process under the Insolvency and Bankruptcy Code (IBC), 2016.
However, while granting the stay, the Supreme Court highlighted that the key
legal issue in question was whether NCLAT had handed over the stalled projects
to NBCC in accordance with the procedures prescribed under the IBC.
In light of this, the Supreme Court
directed all concerned stakeholders, including corporate guarantors, the Yamuna
Expressway Industrial Development Authority (YEIDA), and Supertech Limited’s
promoter, R.K. Arora, to submit any viable alternative proposals by March 21
for consideration. The matter remains pending as the Court evaluates the best
course of action for ensuring the timely and lawful completion of these
projects.
Technical
Member Mitra emphasized that NBCC could not be exempted from complying with
statutory requirements, including the provisions of the RERA Act. The Tribunal
cited the judgment in Bikram Chatterji & Ors. v.
Union of India,
which underscored the public trust doctrine, requiring the State and its
agencies to take affirmative steps for effective project management.
The
Tribunal further noted that homebuyers, who had already made substantial
payments for their units, were entitled to recover only the unpaid dues as per
their respective Builder-Buyer Agreements. It clarified that no additional
costs would be imposed on homebuyers for project completion, apart from
outstanding dues. Additionally, it was observed that funding for the completion
of pending projects should be sourced from unsold inventory, receivables from
homebuyers, and financial support from NBCC.
The
Tribunal also issued the following directives:
1. Homebuyers will not be required
to pay any additional amount beyond what is stipulated in their Builder-Buyer
Agreements.
2. The quality of construction must
be prioritized, with third-party audits conducted by reputable institutions to
ensure standards are met.
3. The completion timeline for the
pending projects must range between 12 to 36 months.
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