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The Yamuna Expressway Industrial Development Authority (YEIDA) is evaluating requests from developers of five stalled projects to avail the Uttar Pradesh government's rehabilitation policy, despite the official deadline having lapsed last year. If approved, developers have agreed to withdraw cases from the National Company Law Tribunal (NCLT) and other courts. The final decision will be made in an upcoming board meeting. The five developers collectively owe INR 2,700 crore to YEIDA. The withdrawal of cases is complex, requiring developers to clear dues, resolve disputes with petitioners, and meet tribunal conditions. Several projects, including those by Supertech Ltd, SDS Infracon, Ajnara India, and Orris Developers, remain incomplete, impacting thousands of homebuyers. The rehabilitation package, introduced in December 2023, had provided concessions, including waivers on interest and penalties.
The Yamuna Expressway Industrial Development Authority (YEIDA) is reviewing requests from developers of five stalled real estate projects to avail the state government's rehabilitation policy, despite the official deadline having passed last year. Advertisement
If YEIDA grants approval, officials mentioned that the developers would subsequently submit applications to withdraw their ongoing legal cases in the National Company Law Tribunal (NCLT) and other courts.
YEIDA Chief Executive Officer Arun Vir Singh stated earlier this week that six builder projects had already availed relief under the government's policy. However, five projects remain entangled in legal disputes, leaving thousands of homebuyers in distress.
According to authority officials, a final decision regarding the policy extension for these developers will be taken at an upcoming board meeting. One of the officials noted that while the proposal has merit, resolving the matter is expected to be complex. The ultimate decision will be made with the interests of thousands of homebuyers in mind.
A key challenge for the board meeting will be addressing the complications surrounding case withdrawals from NCLT, as it involves more than just filing an application. Before approval, developers must fulfil various financial and legal obligations, including settling claims with petitioners, clearing outstanding dues with development authorities, and presenting a feasible plan for project completion. The primary obstacle remains resolving disputes with petitioners who initiated insolvency proceedings-mainly homebuyers and financial creditors such as banks. Even if all obligations are met, the final approval for withdrawal lies with the tribunal.
The five developers collectively owe INR 2,700 crore to YEIDA. This includes an SDS Infracon project in Sector 26A with dues amounting to INR 648 crore, Supertech Ltd's project in Sector 17A (INR 466 crore), Supertech Township project in Sector 22D (INR 651 crore), an Ajnara India project in Sector 22A (INR 55 crore), and an Orris Developers project in Sector 22D (INR 824 crore).
Around 1,400 homebuyers had invested in SDS Infracon's integrated NRI Township project in Sector 26A, spanning 125 acres. The Supertech Township project, which was allotted 100 acres in Sector 22D in 2011, had attracted approximately 3,200 buyers. Additionally, Supertech Ltd's Upcountry project in Sector 17A, which received 100 acres in 2009, includes 3,500-4,000 units of flats, villas, and plots.
In December last year, the National Company Law Appellate Tribunal (NCLAT) directed the National Buildings Construction Corporation (NBCC) to take over 16 incomplete projects of Supertech Ltd.
Orris Developers had been allocated 100 acres in 2011 for a township project comprising 684 plots and 620 flats. Similarly, Ajnara India was allotted 25 acres in Sector 22A in June 2011 for its Panorama project, which was meant to deliver 3,266 flats.
The Uttar Pradesh government had introduced the rehabilitation package in December 2023, offering various concessions to developers. This included a two-year waiver on interest and penalties imposed during the pandemic, provided developers deposited 25% of their revised dues within 60 days of opting for the scheme. Projects under insolvency proceedings were also eligible to avail the policy upon withdrawal of cases.
According to the YEIDA CEO, builders could opt for the package until September-October. He further mentioned that five builders who availed the package had already deposited the required 25%, while ATS Realty had sought an extension until February 28 to complete the payment. He also highlighted that over 2,500 property registrations had been processed under the policy, and five remaining projects had requested YEIDA to extend the 'zero period' to qualify for the scheme.
The potential extension of the rehabilitation policy by YEIDA could provide much-needed relief to developers and thousands of affected homebuyers. However, the complexities surrounding legal withdrawals, financial obligations, and settlements with petitioners pose significant challenges. If granted, this decision could provide a pathway for homebuyers to finally receive their long-delayed properties.
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