Disburse Pending Loans To Amrapali Homebuyers Tagged NPAs, Supreme Court Tells Banks
An Amrapali Group project in Noida. Supreme Court has cancelled Amrapali Group’s RERA registration and told NBCC India to finish construction of the pending projects. (Photographer: Anindito Mukherjee/Bloomberg)

Disburse Pending Loans To Amrapali Homebuyers Tagged NPAs, Supreme Court Tells Banks

The Supreme Court asked banks and other lenders to disburse the remaining loan amount to buyers of homes in stalled Amrapali Group projects even if these accounts have turned bad.

Homebuyers obtained loans but could not enjoy the fruits of their investments because of the delay in the projects, a two-judge bench headed by Justice Arun Mishra said. It will be in the interest of buyers and banks if the pending projects are completed, it said.

“The disbursement of further loans may be based on the present rate of interest fixed by the RBI; this we order in the peculiar facts of the case,” the bench, also comprising Justice Uday Umesh Lalit, said. “It may be released stage-wise and long-term restructuring of the loans may be done so that construction is completed and buyers are able to repay the loan.”

The top court had last year ordered state-run National Building Construction Corp. to take over the stalled projects, saving thousands of homebuyers from losing their investments. The order to release the remaining loan amount came on the suggestion of a court-appointed receiver, Senior Advocate R Venkataramani. He had sought long-term restructuring of all Amrapali homebuyers’ loans and charges on the project held by lenders.

The court on May 27 asked the Additional Solicitor General Vikramjit Banerjee to take the opinion of the Reserve Bank of India. The central bank informed the court that none of its regulations come in the way of releasing loans to homebuyers whose accounts have been declared as non-performing assets.

The banks told the court that they will be willing to release the loans “in a phased manner and as per the stage of construction”.

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