Banks free to provide funds to Amrapali projects, RBI tells SC

New Delhi, Oct 13 (IANS) : The Reserve Bank of India on Tuesday informed the Supreme Court that banks are free to decide on the aspect of financing the Amrapali projects in accordance with their commercial judgements.A bench comprising Justices U.

U.Lalit and Ashok Bhushan directed the RBI to depute a high-ranking officer to coordinate with the court-appointed receiver to conduct a meeting with banks to arrange funding of these projects.

In an affidavit, the RBI has informed the top court that the banks are free decide on financing these projects and it has also written a letter to the Indian Banks Association to consider financing Amrapali projects.The top court also allowed the receiver to independently try and arrange funding for construction.

The receiver also informed the court that UCO bank and Union Bank (including erstwhile Corporation Bank and Andhra Bank) representing 3,074 buyers have entered into an agreement for restructuring the loan accounts, but the other banks are not responding to his requests.The bench directed the other banks to treat these agreements as standard and execute similar agreements with the receiver and consider the applications for fresh loans on their merits independently.

Kumar Mihir, advocate for homebuyers, said: "With Reserve Bank of India playing an active role in arranging the finance for these projects, and finalisation of the action plan for sale of properties and unsold inventory, the biggest hurdle in completion of construction and the prevalent apprehension in the minds of homebuyers will be removed.I am sure, there will not be any shortage of funds and NBCC will be able to complete these projects on time.

"The receiver also informed the bench that the MSTC has filed a detailed action plan for valuation and e-auction of properties and this entire exercise will be completed by February 2021.The bench gave in-principle approval to MSTC to go ahead with the plan and directed it to place a revised schedule on record and the valuation report in a sealed cover.

NBCC informed the court that it will undertake sale of unsold inventory and FAR, and the court directed it to place the complete list of unsold inventories by next date of hearing.The receiver submitted before the court that talks with SBI Caps have been finaliwed and sought the courts permission to incorporate a "Not for Profit Company under Section 8 of Companies Act, 2013 to receive funds from SBI Caps/SWAMIH Fund.The court granted its permission.

The top court has scheduled the next date of hearing on October 29, when it will take up the issues regarding recovery of funds in terms of findings of Forensic Auditors.ss/vd .