Under the subsidy scheme, the banks transferred the approved amount directly to the builders’ accounts
The Supreme Court has sought a report on the status of pending housing projects in the National Capital Region (NCR). Buyers had taken loans under the subsidy scheme to buy houses in these projects. The loan EMIs were to be paid to the builders until the possession of the house was handed over. But, the builders could not complete the project on time nor did they pay the EMIs to the banks. On the default of the builders, the banks started recovering from the home buyers. Under the subsidy scheme, the banks transferred the approved amount directly to the builders’ accounts.
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According to this scheme, the builders had to pay EMIs until the buyers got possession of the flat. Home buyers approached the Supreme Court against this. The bench of Justice Suryakant and Justice Ujjal Bhuyan has conducted a comprehensive study on this problem and sought information from all the concerned parties. The court said that it is necessary to find out how much the builders paid to the banks, how much the buyers paid to the builders or the banks and what is the current status of the projects.
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The Supreme Court has sought details of payments made to banks by the builders and buyers, the date of handing over possession in projects that have been declared complete, the current progress of the housing project, the status of recovery from buyers, the facilities promoted by the builders at the time of launch and their current status, and whether insolvency and bankruptcy process (CIRP) or any other recovery process has been initiated against the builder. The Supreme Court had earlier given relief to home buyers and had stopped banks and builders from taking strict action against them. The court had also directed that no complaint should be filed against buyers in cases like cheque bounce.
In a decision in 2023, the Delhi High Court refused to give relief to home buyers. Home buyers had approached the Supreme Court against this decision. The Supreme Court gave interim relief to the buyers. The petitioners alleged that the banks illegally deposited the loan amount in the accounts of the builders in violation of RBI guidelines.
