The Apex Court has asked SBICAP to initiate the funding for the six identified projects of the now de-functioned Amrapali Group as those six are the only viable ones as per the financial institution to be invested upon. The Supreme Court has also referred the case to the Centre stating that the respective case should be considered as a “special case” and lend out the remaining money for the construction of the other stalled projects from the Stressed Funds which is specifically created for Real Estate sector.
The Bench comprising of Justice Arun Mishra and Justice U.U Lalit was informed by Harish Salve, the counsel of SBICAP that they have decided to fund only six identified projects of the now-defunct Amrapali Group. As per the Bench, “Salve made contentions that the funding should first start with six identified projects of Amrapali Group. However, there were certain suggestions made by the receiver where it was replied by Mr. Salve that in case any further directions are issued by the Centre with regard to the projects in question, the SBICAP ensures that they will adhere to those directions as a special case.”
The Supreme Court has also directed Solicitor General Tushar Mehta, representing Centre to be in touch with the Ministry of Finance for taking suitable action as it is regarded as a special case by the Apex Court and the stressed funds are being used tenaciously and in an appropriate manner. The Bench posted its liberal thoughts about the rate of interest that “Let the prevailing rate of interest on lending also be considered with respect to returns of profit on investment.”
The SBICAP Ventures who are also the mangers of the government-sponsored Stress Fund for the Real Estate sector, in order to aid the rushed home buyers of the Amrapali Group stated the Supreme Court that it was prepared to fund the other stalled projects of the besieged real estate firm. The SBICAP Ventures further stated the Court that it will create a Special Purpose Vehicle (SPV) with the receiver onboard and would hire a Chief Executive Officer to take over the remaining construction of the 7 stalled projects.
As the nation is reeling slowly due to the Covid-19 crisis and the lockdown functioning, the real estate companies in Noida and Greater Noida have received a huge relief from the top court as the rate of interest to be charged by the authorities has been capped to 8 percent on the outstanding dues of the estate as against the excessive 15-23 percent. The Supreme Court gave the reason that the Real estate sector is running low currently and all the projects have come to halt and thus the sector needs a push right now especially considering the conditions of the homebuyers.
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