In relief for several thousands of Amrapali home-buyers, who booked their flats under subvention scheme, the Supreme Court on Monday directed the banks not to impose penalties on default of EMI (equated monthly instalment) payment.
A bench of justices UU Lalit and Bela M Trivedi said the accounts of defaulter flat-buyers, who had availed the subvention facilities, should not be treated as non-performing Asset (NPA) accounts and also their CIBIL score should not be maintained at zero level.
The bench took note of home-buyers' difficulties, but made it clear that after getting the possession of the flat, the home buyer was liable to pay the EMI towards the loan as per the agreement.
It said the liability of home-buyers would come into effect from the date when possession of the flat is handed over and banks can take action if they do not discharge their liability. The bench said banks should not impose a penalty for default committed by the flat-buyers, but would be entitled to the principal as well as interest on it.
The top court asked the banks to regularise the accounts of home-buyers when they approach the lender concerned.
Advocate Kumar Mihir, representing home buyers, said: "It is a huge relief to the home buyers who, on one hand, had not got their houses and on the other hand, had to face recovery proceedings initiated by banks without any fault on their part."
Under the subvention scheme, the home-buyer was not required to pay any EMI, during the 'No EMI period' till the completion and possession of the flat. Several thousand home-buyers in the Amrapali housing projects availed this scheme; however they were burdened with the EMIs without getting possession of the flats.
Mihir added that this will also ensure release of more funds on behalf of the subvention buyers towards their flats which will help the court receiver to complete the Amrapali projects.
The bench also noted that a consortium of banks and Greater Noida authority have completed the required documentation and Rs1,350 crore will be available for the purpose of construction of housing projects.
On 4th April, the Supreme Court was informed that the first tranche of Rs150 crore out of the total sum of Rs1,500 crore, meant for construction of stalled Amrapali housing projects, has been directly paid to the National Buildings Construction Corporation (NBCC). A consortium of seven have granted final approval to infuse Rs1,500 crore.
Senior advocate and court-appointed receiver R Venkataramani, in a note, said: "In compliance with the order dated 28th March, on 31st March the Banks disbursed a sum of Rs150 crore, though the actual requirement/request by NBCC was for Rs 540 crore. The disbursal of loan was subject to certain pre-condition compliances, as set out in the sanction letter(s) of each Bank."
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.