Jaypee homebuyers protest at Jantar Mantar, say insolvency a fraud

Buyers are worried that if the insolvency procedure is initiated, then the banks would be at liberty to auction the flats to recover their money, leaving the buyers with nowhere to go.

Hundreds of people who bought flats in Jaypee Group’s housing projects protested against the real estate company and the government over the delay in delivery of projects, at Jantar Mantar on Saturday.

Jaypee homebuyers protest at Jantar Mantar in New Delhi on Saturday.(Sushil Kumar/HT PHOTO)

Hundreds of buyers are panicking after the Allahabad bench of the National Company Law Tribunal (NCLT) admitted a plea of IDBI Bank, allowing insolvency proceedings against Jaypee Infratech for defaulting on a ₹526.11 crore loan.

Though the Noida authority, Jaypee Infratech and the Interim Resolution Professional (IRP) had reassured buyers that their investments are safe, homebuyers are apprehensive.

One of the buyers, CP Surendran, said he was not sure if the newly appointed IRP would work in his interest.

Another buyer, who wanted to remain anonymous, said he had come from Jodhpur to protest against the group.

“I had bought a flat in the Jaypee Aman project in 2009. They had a scheme at the time under which if we paid 95% of the amount upfront as down payment then we would get a discount of almost ₹1.9 lakh. So I had paid the amount, and I was supposed to get the flat by 2013. Now, I am not even sure if I will get it all,” he said.

Buyers are worried that if the insolvency procedure is initiated, then the banks would be at liberty to auction the flats to recover their money, leaving the buyers with nowhere to go.

“This is the connivance of the builder, politicians and the Noida authority. The flats will be auctioned. New developers will buy it and sell it again at maybe even double the rates. We will probably get 30%-40% of our initial investment… Why did the firm need to take a working capital loan when many buyers have paid 95% of the price upfront? How can a bench in Allahabad make a decision in favour of the bank when there are stakeholders across the country?” asked Sudhir Dhar, who had bought an apartment at Kasa Isles.

The protesters said they would stop paying EMIs if they are not given the flats.

“We have lost faith in the system — the government, the legal system, the banks, everything. I am not even sure I want to have a bank account anymore,” said Lata Iyer, one of the protesters.

Her husband, Rajesh Yadav, echoed the general mood of the crowds that raised slogans against the Modi and Yogi governments.

He said the situation arose due to government’s negligence and possible participation.

“This is real fraud if you think about it. It is a government-sponsored Ponzi scheme. They have allowed two parties, the buyers and the builders, to take loans on the same property,” he said.