Unitech Housing Challenges Noida Authority’s Unit Approval, Citing Supreme Court Violation

The government-appointed board overseeing the completion of Unitech’s housing projects has approached the Supreme Court, challenging the Noida Authority’s decision to approve individual housing units rather than the entire project as mandated by the court. The board claims that this selective approval process violates a previous order from the Supreme Court in April, which called for project-wide approval.

Dispute Over Unit-Wise Approval

In its application to the Supreme Court, the board, responsible for managing the completion of Unitech’s delayed housing projects, criticized the Noida Authority for approving individual units rather than granting approval for the entire development. The board expressed confusion over the logic behind approving specific units while the entire project was supposed to be developed as an integrated township.

“It is beyond logical comprehension as to how permissions can be given for individual units when the project must be developed as an integrated township in its totality,” the board stated in its application before a bench led by Chief Justice of India, Dhananjaya Y Chandrachud.

Alleged Violation of Court Orders

The board’s application highlights that the Noida Authority’s decision to grant unit-wise approvals goes against a clear court directive from April. According to the board, the Supreme Court had specifically ordered the authority to provide “project-wise approval.” Instead, the authority has been approving units based on the number of homes sold and excluding those for which buyers have sought refunds, which the board argues defies practicality.

“This impracticality in granting such approvals merely shows the high-handedness and adamant attitude of Noida officials in not even complying with numerous specific orders passed by the Supreme Court,” the board said in its filing.

The board also raised concerns that this fragmented approval process could hinder their ability to obtain regulatory clearance from the Real Estate Regulatory Authority (RERA). They explained that 70% of the funds collected from homebuyers by the previous Unitech management are no longer available, complicating the completion of these projects.

The Plight of Homebuyers

The board’s appeal comes at a time when thousands of homebuyers continue to await possession of their long-overdue homes. These unfinished housing projects are spread across Noida’s sectors 96, 97, 98, 113, and 117. Many buyers, who have invested millions of rupees, remain frustrated over the lack of progress and delays in delivering their homes.

In April, the Supreme Court had issued a directive requiring the planning authorities to approve revised building plans by May 31. The court emphasized that these approvals should encompass the entire project, including flats and essential amenities. The court further stressed that homebuyer contributions must be used to complete the construction of these projects to restore confidence and provide hope to buyers waiting for their homes.

Financial Challenges and Rising Costs

The Unitech board, comprised of government appointees, took control of the stalled projects in 2020 following allegations of financial mismanagement by Unitech’s former promoters, Sanjay and Ajay Chandra. The Chandra brothers currently face charges of cheating homebuyers and money laundering.

The board has repeatedly expressed concerns about rising construction costs, which have escalated to over ₹11,000 crore, according to additional solicitor general N Venkataraman. During previous hearings, Venkataraman informed the court that the board urgently needed approvals to complete the remaining flats, sell unsold units, and develop vacant land.

Noida Authority’s Position

However, the Noida Authority, represented by senior advocate Ravindra Kumar, pushed back on the board’s claims. Kumar argued that Unitech still had surplus funds, with ₹8,000 crore tied up in unsold flats and an additional ₹3,200 crore owed by homebuyers still awaiting possession.

The Noida Authority’s defense centered on the availability of these funds, implying that the board had the financial resources to continue construction and deliver the promised homes.

Moving Forward

As the case moves forward, the Supreme Court will likely weigh the arguments from both sides in deciding whether the Noida Authority’s unit-wise approvals violate its earlier order. The court’s decision could have significant implications for the completion of these long-delayed projects and the thousands of homebuyers eagerly awaiting resolution.

The matter has been posted for further consideration, with the court expected to delve deeper into the feasibility of granting project-wide approvals and the financial implications involved in completing the unfinished homes.