Review Gardenia debt plan, Noida Authority urges UP govt

Time of India

5 hours ago

Noida: Noida Authority has decided to write to the state govt to reconsider its order allowing Gardenia Aims Developers to clear a portion of its dues through proceeds generated from the auction of 122 sealed flats in its Sector 46 project.
The Authority said that if allowed, the move would contradict a cabinet-approved policy for stalled projects, which requires defaulting builders to deposit 25% of dues before accessing relief measures.
At a meeting on June 14, the Authority board, after examining various aspects of the govt's May 29 order, said that it conflicted with the provisions of the rehabilitation plan for stalled projects decided in Dec 2023.
The govt order, under Section 41(3) of the Uttar Pradesh Urban Planning and Development Act, allowed the builder to use proceeds from the auction of 122 sealed flats in Gardenia Glory in Sector 46 to fulfil this 25% requirement.
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In 2009, Gardenia Aims was allotted 51,719sqm. The builder deposited around Rs 60 crore against a premium of Rs 151 crore. However, the project faced delays, with only 20 of 21 approved towers completed.
Of the 1,586 approved units, just 551 received occupancy certificates by Oct 2019.
By Dec 2023, total dues stood at Rs 692 crore, with a Rs 130 crore Covid-related rebate. On March 13, 2024, the Authority demanded Rs 140.5 crore (25% of recalculated dues), but no payment was made.
On June 5, 2024, the Authority ordered the auction of 122 sealed flats and cancelled the lease of a separate 150-acre commercial plot. The builder secured a stay from a commercial court in Noida on June 19, 2024, prompting the Authority to approach the Allahabad HC.
The case remains sub judice.
Separately, the builder filed a revision petition. On May 29, the principal secretary of the industrial development department ruled that the Authority could proceed with the auction. The plot would then be restored without fees, and zero-period benefits would be considered per the Dec 2023 policy. Any shortfall would be borne by the builder. Importantly, this order also directed the Authority to decide on the builder's proposal within one month.
In response, the builder submitted a written proposal and appeared for a hearing before the addition al CEO. They also urged the Authority that it withdrew its earlier case from the commercial court.
The Authority then wrote to the govt, stating that any action on the builder's proposal would require guidance from its board, which sought reconsideration of the govt order.