India: Supreme Court On Amrapali- Perils Of A Piecemeal Approach To Justice

Last Updated: 30 August 2019
Article by Rajesh Sivaswamy

With no end in sight to the number of real estate bankruptcies in the country, the Hon'ble Supreme Court has been perhaps the only beacon of light to home buyers who have been embroiled in a quagmire of litigations desperate to see light at the end of the tunnel.

A case on point is the recent judgment of the Hon'ble Supreme Court of India on July 23, 2019 in Amrapali case, where the court has cancelled the registration of the Amrapali Group of Companies (Amrapali) under the Real Estate Registration Act (RERA) and has anointed the National Building Construction Corporation Limited (NBCC) to supervise and complete unfinished projects of Amrapali and hand over possession to the buyers at a fixed rate of 8% as commission. The Court through an order dated August 26, 2019 transferred an amount equivalent to INR 7.16 crores approx. as project management fees into the account of the NBCC. While this order may come as a breath of fresh air to home buyers, it throws up several questions that require careful deliberation.

The Supreme Court has taken a clear stand in favour of home buyers and has shown contempt and disdain to real estate firms who have been tardy with timely completion of projects. We should expect more of such judgments on similar lines involving other realty firms. The Supreme Court has already demonstrated this intent in another matter where it dismissed a plea by a number of real estate firms who challenged the elevated pedestal that has been accorded to home buyers designating them as 'secured creditors' under the Insolvency and Bankruptcy Code.

Though the task of completion of pending projects of Amrapali has been given to the NBCC with the noblest of intentions, NBCC by itself may not be the white knight that can salvage the systemic rot that has crept into the real estate sector. NBCC is a Government of India enterprise which was established in 1960 under the erstwhile of the Ministry of Housing and Urban Affairs, Government of India and primarily deals with construction projects. To its credit, the NBCC has posted substantial growth since its inception and its revenue in the financial year 2018-2019 crossed the INR 10,000 crores mark contrasted with the revenue in the financial year 2002-2003 which was less than INR 500 crores.

Despite these accomplishments, the task before the NBCC is daunting. Approximately 42000 homes are to be handed over to ultimate buyers after the completion of the project by NBCC. The overall value of the stalled units is estimated to be more than INR 1.77 trillion. With a few more projects like Jaypee on the horizon, one feels that the challenges that the NBCC faces will go up incrementally.

On a purely legal evaluation, there is no legal recourse to the home buyer in the event of further delays to the projects on account of the procedures and the sheer enormity of the tasks. The home buyer also has limited legal remedies in terms of the agreements which have been executed with the developer. Questions surrounding the overall quality of the construction as well as the delays remain unanswered and it is quite obvious that the home buyer is taking a haircut here.

To assuage concerns surrounding financial viability, the Hon'ble Supreme Court of India has ordered the Noida and Greater Noida authorities that any dues proposed to be recovered from Amrapali shall be undertaken through the attachment of other properties belonging to the promoters. It is not clear if these properties will in any way suffice the amounts to be recovered. It is also contemplated that a tripartite agreement would be executed post completion of the project between the home buyer, Noida or Greater authorities and NBCC. The Supreme Court has assured home buyers that it will personally supervise compliance of this order and directed them to deposit their balance sale consideration and all the money owed to the Amrapali Group to be submitted to the Court and to be maintained in an escrow account, which shall be utilized by the NBCC for completion of the projects.

Despite these measures, treating the NBCC as a panacea for all evils that plague the real estate sector may not be the right view. The RERA which was heralded as a revolutionary step in augmenting the real estate space providing guiding principles for governance has been rendered as a toothless tiger in many states with multiple state amendments and ineffective implementation. It is high time that the legislature of states also takes a re-look at the changes made to the RERA with the intent to bring back the efficacy that the legislation was originally intended. With the deteriorating health of the real estate industry, banks have become averse to lending to a sector which was, till a few years back, the hot cake of the financial world. It is necessary to bring back some semblance of normalcy by ushering reforms in the lending process and adopting procedural safeguards which will balance the interests of lenders and real estate firms. A holistic view of reforms in the real estate sector requires amongst others transparency in (I) land records making it available digitally, (II) land procurement process, (iii) reform in procuring registrations and permits. Unless such a holistic process is adopted and implemented by the state legislatures along with the banking and finance industry, the average home buyer will have to be satisfied with a piecemeal approach for justice.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Similar Articles
Relevancy Powered by MondaqAI
In association with
Related Topics
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions