Experts to audit stalled Amrapali projects, Supreme Court told

The National Buildings Construction Corporation (NBCC) on Monday told the Supreme Court that it has appointed independent experts to assess the safety and quality standards of the stalled Amrapali housing projects where structural deficiencies were reported against some of the buildings built by the developer.

NBCC was roped in by the top court in July 2019 to complete the stalled housing projects following the order to cancel the registration of Amrapali under the Real Estate (regulation and development) Act 2016 (Rera) for diverting money received from the homebuyers.

On Monday, NBCC’s safety standards were put to question by the Amrapali homebuyers who said that nearly 650 residents of the state-run firm’s Green View project in Gurugram have been asked to vacate the “unsafe” structures.

Stating that safety of residents is paramount, NBCC, represented by senior advocate Siddharth Dave told the Supreme Court that construction work of the Amrapali projects undertaken by the firm will be of good quality, and that no compromise will be tolerated at any juncture.

“We have appointed two agencies to apprise us of the quality control issues and adherence to quality standards after we realised certain structural deficiencies in some of the buildings of the Amrapali group handed over to us,” Dave said. Dave informed the court that the National Institute of Technology (NIT), Nagpur and NIT, Jalandhar have been appointed to conduct the audit.

The issue was raised before the court by Amrapali homebuyers, represented by advocate ML Lahoty, who were worried over the recent news of the roof collapse at Chintels Paradiso in Gurugram that led to two deaths. Following the incident, residents of NBCC’s Green View project at Gururgam’s Sector 37D received notices to vacate as their buildings were found to be “unsafe”.

Lahoty said, “There are roughly 650 homebuyers of NBCC’s Green View apartments who received notices from the state authority asking them to vacate by this month end as the project is structurally weak. The IIT-Delhi gave a report to this effect in October last year. Let the IIT-Delhi carry out a structural audit of the Amrapali projects too.”

The bench of justices UU Lalit and Bela M Trivedi sought to distinguish the incident from the Amrapali batch of matters. “In those matters, probably there were some acts of omission by private entities. We have selected a public entity of repute. Allow NBCC to function. They are acting under our orders.”

Dave clarified for NBCC, “We have inherited these projects from Amrapali. When we realized there are certain defects, we have appointed experts. We don’t want to put safety of residents at risk.” As regards the Green View project, Dave said that the construction work was assigned to a contractor.

Senior advocate R Venkatramani, the court-appointed receiver also told the apex court of the progress made on the funding to finance the stalled projects. NBCC claimed that it had spent over ₹109 crore from its own kitty and was short of funds with outstanding dues to the tune of ₹522 crore.

Venkatramani, in his latest report, informed the Supreme Court that due to the Covid-imposed lockdown, the consortium of six public sector banks led by Bank of Baroda is still pending approval at the top level of the individual banks. The bench directed the six banks – also including the Punjab National Bank, State Bank of India, Bank of India, UCO Bank, and Punjab & Sind Bank – to furnish approvals within a week and release the first tranche of payment of ₹300 crore by March 15.

The Receiver further informed that assets of Amrapali group, including the personal assets belonging to Amrapali’s directors Anil Kumar Sharma and Shivapriya have been auctioned and an amount worth about ₹120 crore generated.

“In the past six months, the Receiver has been able to sell properties worth approximately ₹120 crore,” Venkatramani said in a note presented to the Court. In a separate property belonging to Shivapriya where auction is currently on hold, the Court allowed the Receiver along with a forensic auditor assisting the Court – Pawan Agarwal – to examine the documents submitted by the Amrapali director before concluding the auction. The Court also told the banks staking claims on dues against the auctioned properties that the principal amount can be returned and told banks to consider waiving demand of interest component.

The top court is supervising the completion of the Amrapali projects since July 2019, when the registration of Amrapali group was suspended after it was found that the directors of the real estate firm diverted the funds received from homebuyers into other businesses while laundering part of the amount through shell companies. The court had appointed senior advocate R Venkatramani as receiver to take measures for early completion of the flats.

Following the court orders, 1,700 dwelling units have been constructed of which 800 have been successfully handed over to the homebuyers after due verification. The homebuyers informed the court that NBCC would require ₹400 crore initially as a bridge fund to carry on with construction. The court refused to issue any specific order. It said, “The money has to come from banks which are custodians of public money. Let them decide after taking into account all aspects.”