Noida Seeks Supreme Court's Intervention to Recover ₹193 Crore from Lotus 300 Developer

The Noida Authority has approached the Supreme Court seeking to recover ₹193 crore in unpaid dues from Hacienda Project Pvt Ltd (HPPL), the developer behind the Lotus 300 housing project in Sector 107, Noida. This legal action comes after the Supreme Court's September 27, 2024, order, which directed the Noida Authority to proceed with issuing registry permissions for the project. The Court’s ruling focused on safeguarding homebuyers’ interests, despite the developer’s failure to settle its financial obligations.

Following the Supreme Court's ruling, the Noida Authority filed a "recall plea" asking the Court to reconsider its decision. The Authority’s concern is that without revising the order, it stands to lose ₹193 crore in government revenue, which HPPL has failed to pay.

Ravi Prasad Gupta, the Chief Legal Adviser for the Noida Authority, stated that the developer’s unpaid dues represent a significant financial loss for the Authority. The recall plea aims to protect the financial interests of the Noida Authority and ensure that the developer is held accountable for the outstanding amount.

The issue began earlier in 2024 when the Allahabad High Court issued an order in February directing the Noida Authority to issue registry permissions for the Lotus 300 project, even without a “no-dues certificate” from the developer. This order came in response to a writ petition filed by homebuyers seeking to obtain legal ownership of their properties. The Court highlighted the developer's failure to meet its commitments and deliver homes on time, leaving the homebuyers in a prolonged state of uncertainty.

However, the Noida Authority objected to this decision, arguing that issuing registries without recovering the ₹193 crore in land cost dues would result in a substantial financial loss. The Authority then approached the Supreme Court, which, in its September order, directed the issuance of registry permissions to protect the homebuyers’ rights. As a result, the Noida Authority began the process of issuing registries for some apartments, although it continued to seek recovery of the outstanding dues from the developer.

In response to the Court’s order, the CEO of Noida Authority, Lokesh M, appointed Vaibhav Gupta as the nodal officer to oversee the project’s formalities. According to officials, the first phase involves issuing registries for 102 apartments in Towers 1 and 2, which already have occupancy certificates. Towers 3 to 6, which do not have occupancy certificates, will be dealt with in the second phase after the developer completes the necessary documentation.

Lotus 300 is a large residential development consisting of 330 flats, around 300 of which are currently occupied. The ongoing dispute over the developer’s unpaid dues has caused significant delays, with some flats originally promised for delivery as early as 2013-14. Many homebuyers have been waiting for years to take possession of their homes, leading to frustration and distress.

The financial mismanagement by HPPL has also raised concerns. Investigations revealed that the promoters of HPPL collected ₹636 crore from homebuyers but diverted ₹190 crore of these funds. Additionally, a portion of the land allocated for the project was sold to a third party for ₹236 crore, and the proceeds were pocketed by the promoters. The Enforcement Directorate (ED) has since launched an investigation into the promoters of HPPL and the officials involved in the land allotment process. This has further complicated the situation, as the authorities work to ensure that the developer is held responsible for its actions.

The Noida Authority originally allocated 17 acres of land to HPPL in 2010 for the development of Lotus 300. The project was scheduled to be completed by 2013-14, but the developer failed to meet its delivery deadlines. This has caused both financial and emotional hardship for many homebuyers who had invested in the project with the expectation of timely delivery.

As the legal battle continues, the Noida Authority is taking steps to protect both the homebuyers’ interests and the financial stability of the region. The recall plea filed by the Noida Authority highlights the challenges faced by local authorities in dealing with developers who fail to meet their obligations

The outcome of the recall plea will have significant implications for the future of the Lotus 300 project. For homebuyers, the resolution of the issue is crucial, as they continue to wait for a resolution to their long-standing concerns.