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Home buyers who have given money to developers should get flats: Arun Jaitley

Finance Arun Jaitley countered the Opposition's charges after a report by the RBI stated that 1% of demonetised currency had not come back to the banks. Photograph: (Zee News Network)

WION Web Team New Delhi, Delhi, India Aug 16, 2017, 12.15 PM (IST)

Amid insolvency proceedings against debt-ridden realty company Jaypee Infratech comes Finance Minister Arun Jaitley's statement today (August 16) that the government sympathy is with flat buyers.

"Flat buyers who have given money to developers should get their flats, government's sympathy is with the flat buyers," Finance Minister Arun Jaitley said at a press conference.

Hundreds of home buyers have been left in lurch - their investments stuck - after the National Company Law Tribunal (NCLT) admitted the bankers' plea for initiating insolvency proceedings against Jaypee for defaulting
on a Rs 526-crore loan.

On Monday, a top finance ministry official said the government was exploring whether it was legally tenable to sell other assets of the debt-ridden company to raise money to complete pending housing projects of the
company.

"The government is looking at ways to provide relief to Jaypee Infratech home buyers," the official said.

"We will discuss with the corporate affairs ministry if bankruptcy code provides any legal ground for sale of other assets of companies to fund completion of pending projects."

The government also said it was considering the possibility of appointing a receiver or state agencies for the completion pending projects, where home buyers had paid money for booking flats.

"We may have to take the legal way through the NCLT, which can pass an order to appoint an authority - may be a state agency - to sell assets of Jayee Infratech and with the money from sale of assets, the pending projects
could be completed," he said.

Insolvency proceedings, he said, can continue simultaneously.

Last week, the Allahabad-bench of NCLT admitted insolvency plea of IDBI Bank relating to default of Rs 526 crore loan by Jaypee Infratech.

It appointed Anuj Jain the interim resolution professional (IRP) to carry out the proceedings under the Insolvency and Bankruptcy Code.

The implication of an interim resolution professional's appointment is that investors cannot sell, transfer or get possession of their flats under construction. There will also be a status quo on the execution of the registry of a
property.

Jaypee Infratech, a part of the debt-ridden Jaypee group, has defaulted on Rs 526.11 crore outstanding loan to the IDBI. 

The biggest incomplete project of Japyee is the mammoth Wish Town project in Delhi suburb Noida.

The company has reportedly handed over only 5,500 of the proposed 32,000 flats and 3,000 plots across 800 acres along the Noida-Greater Noida Expressway. 

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