Greater Noida builders to move court after receiving notices for 'diverting' Rs 840 cr


Following the move by Noida Authority to issue notice to 11 builders for diversion of funds collected from the home buyers, the Yamuna Expressway Industrial Development Authority (YEIDA) too has issued similar notices to eight builders on Tuesday because audit of their accounts suggests diversion of Rs 840 cr meant for completing flats.


YEIDA has asked the eight builders to open escrow accounts and deposit the amounts allegedly diverted within a month. If they do not do so within the stipulated time, police complaints will be filed against them. The notices drew a strong reaction from the developers, who termed the allegations baseless and malicious.


Arun Vir Singh, the CEO of YEIDA, said, “These eight builders include Logix Buildstate Pvt Ltd (Rs 37.84 cr), Greenbay Infrastructure Pvt Ltd (Rs 173.10 cr), Oasis Realtech Pvt Ltd (Rs 8 cr), Sunworld City Pvt Ltd (Rs 27.55 cr), SDS Infracon Pvt Ltd (Rs 182.44 cr), Three C Homes Pvt Ltd (Rs 27.93 cr), Supertech Township Projects Ltd (Rs 262.82 cr) and ATS Realty Pvt Ltd (Rs 120.75 cr). According to the report, there is a difference between funds collected by the developers and what was spent on the respective projects.”


YEIDA also directed builders of 28 projects to pay up Rs 3,500 cr they owe to it within the same time frame or face recovery proceedings.


Singh said YEIDA had formed a five-member committee, headed by additional CEO Amarnath Upadhyay, in November last year to audit the builders’ accounts, following a directive from chief minister Yogi Aditya Nath. “The committee’s findings and final report are based on details such as money collected for a housing project from buyers, banks and other institutions, money spent on land or construction and how much cash was used to finish a project by the respective builders,” the CEO said.


The big developers like the ATS, Logix and Supertech are leading the chorus of protest against the notices. “We are now left with no option but to file a defamation suit against such high-handedness to save our reputation,” said CMD of ATS Getamber Anand, who is also chairman of realtors’ association Credai.


A spokesperson for the Logix group said since YEIDA could not give possession of land even eight years after purchase, the company had sought to return 130 acres out of 200 acres.


“YEIDA deducted Rs 42 cr — 15% of the principal amount of around Rs 280 cr — which was paid for 130 acres. It refused to refund the stamp duty on returned land which is around Rs 17 cr,” the spokesperson said, adding the company was yet to receive even the 70 acres. On the basis of the allotment, Logix had sold plots and collected money. In 2017, the spokesperson said they advertised in newspapers and asked buyers to take refund with 5% interest. “There is no buyer in the project today,” the spokesperson added.


“How can YEIDA say we diverted funds?” Anand said before declaring them guilty of diversion of funds, the authority did not give them a hearing. He said construction of the ATS project is already complete. “Cases on calculation of land dues are in court. Developers are being asked to pay additional farmers’ compensation at the rate of around 64% of the original cost. These issues should be resolved first,” he said.


Supertech CMD RK Arora said that out of 100 acres land allotted to his company, only 50 acres had been handed over so far. In the meeting with the auditors, he said the company had showed it had spent much more than what it had received from buyers. But it had to complete the project, and had to use money from its own sources as well as borrowed funds to do so, Arora said. It has applied for completion certificate for the first phase, Arora said.

Written by The Realty Paper

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