In a major relief to the flat owners of two Supertech Towers that face threat of demolition, the Supreme Court on Wednesday directed the real estate company to refund the principal amount to the owners within one month. The flat owners of the twin towers — Ceyane and Apex — located on the Noida Expressway had applied for refund under an offer floated by the company a week after it was ordered to be demolished by the Allahabad High Court on April 11.
The court also directed the company to pay by October 30, 14 per cent compound interest on the amount to the residents as per its own letter dated April 19, 2014, a week after the High Court passed the order damning the construction. Supertech floated the refund offer on April 19, but was dragging its feet on the implementation, forcing the flat owners to approach the SC.
On Wednesday, the company told the court that it was forced to make the refund offer when its officials were gheraoed by angry flat owners.
Although 600 flats in the two towers have been sold out, the apex court’s order will benefit only those customers who applied to the company on or before April 30 for refund. In its letter, the company gave homebuyers the option of either availing the refund or swapping their flats with any upcoming residence in any other projects launched by Supertech.
The court also allowed the offer of “swapping” and asked the Supertech to submit within a week a written undertaking to implement the refund offer. The order is bound to create a tremendous financial burden on Supertech considering that 53 flat owners, who came before the court, are going to get the refund under the court order. In addition, the company admitted there were other buyers who had not approached the court but had applied for refund before April 30.
Aware of the “hardship” faced by the customers who had purchased the high-end flats in 2008, the SC Bench headed by Chief Justice RM lodha said, “They (flat owners) have not purchased litigation but flats. You have constructed a building which the High Court has found to be against law…We will examine the correctness of the HC order. But they cannot be made to wait any longer.”
Senior advocate Ravindra Srivastava, who appeared for Supertech, tried to persuade the court not to pass an order for refund as it would open a floodgate of similar demands and make the project unviable. Begging mercy from the court to spare thought on the hardship faced by the company, he said, “We will collapse. The principal amount to 53 allottees is itself a huge amount. The compound interest over the years will be higher than the principal amount.”
The Bench, which also comprised Justices Kurian Joseph and Rohington Nariman, retorted, “You cannot play with the lives of people. Don’t argue that we will collapse. They are only asking what you have agreed to offer.” The matter was deferred as Srivastava took instructions and demanded a period of 45 days to pay the principal sum. The court reduced it to 30 days, advising the company, “You must stand up to the trust they (buyers) have reposed in you. After all, buildings are formed on trust.”