'Not got a single paisa': Noida asks SC to relook interest rate cap for realtors

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SME Times News Bureau | 14 Sep, 2021
Over a year after the Supreme Court had, in June 2020, directed Noida and Greater Noida to cap the interest rate at around 8 per cent for delay in payment of land cost by builders, instead of a steep 15-23 per cent, the authorities have asked the top court to recall its order, citing that the builders have not deposit "a single paisa" to clear their dues.

Advocate Ravindra Kumar, representing the authorities, submitted before a bench of Justices U.U. Lalit and Ajay Rastogi on Monday that this order was passed without examining all issues.

Then the top court was hearing the Amrapali case and it was assessing ways to protect the interest of Amrapali home buyers, but, the general order passed by the court was applicable to all real estate developers, who were not even party in the case, he contended.

As the bench asked how is it possible to recall the order after one year, against the backdrop of claims that some of the builders might have benefited, counsel submitted that after the top court's June 10 order, everything has been halted. "Not a single paisa has been paid in the last one year," he told the bench.

Kumar Mihir, counsel for Amrapali home buyers, said: "This issue is affecting all the home buyers of Noida and Greater Noida who are waiting for registration of their title deeds."

He added that hopefully the top court will decide this issue at the earliest and ensure that no extra burden is passed on to home buyers by the builders, who have, for reasons best known to them, defaulted on payment of land dues to the authorities.

Counsel representing the builders objected to the submissions made by the Noida and Greater Noida counsel, saying that seeking the recall of the top court is not correct and the authorities waited for the judge, who passed the order in the matter, to retire and then filed this application.

In its June last year order amid the pandemic, the top court had cited the current state of real estate, the projects at a standstill, and the need to give impetus to such housing projects, mainly considering plight of home buyers and as pointed out by Noida and Greater Noida Authorities that 114 plots were allotted from 2005 onwards, but most of projects are incomplete.

"We direct that rate of interest on the outstanding premium and other dues to be realised in all such cases at the rate of 8 per cent per annum and let the Noida and Greater Noida authorities do a restructuring of the repayment schedule so that amount is paid and Noida and Greater Noida authorities are able to realise the same," the top court had said.

The June order was passed on a plea of Ace Group of Companies alleging that various projects are stalled due to excessive lease rent, penalty and interest charged and levied, additional land costs demanded, and charged on the land allotted.