News: Restore creditworthiness of buyers in stalled projects: Delhi HC-04-04-2022
Delhi high court has directed the banks to convey to CIBIL to restore the creditworthiness of homebuyers who stopped paying EMIs for incomplete projects.
NEW DELHI: Delhi high court has directed the banks to convey to CIBIL to restore the creditworthiness of homebuyer s who stopped paying EMIs for incomplete projects. “In the light of the interim order, the respective banks/financial institutions are directed to provide appropriate information regarding the petitioners to Credit Information Bureau (India) Limited (CIBIL) so that the ratings of the petitioners are suitably amended,” justice Rekha Palli observed while hearing a bunch of petitions filed by homebuyers
The HC had in January this year restrained banks/housing finance companies (HFCs) from taking any coercive action to recover EMIs for incomplete projects, coming to the rescue of 1,200 such homebuyers.
The court had then noted that “grave and irreparable loss” will be caused to the petitioners if they are not granted any interim protection while adding that the matter “brings into light the well-known sorry state of affairs, which has been recently going on in the construction industry.” Appearing for the petitioners, advocate Aditya Parolia submitted
before the court that the grievance of the homebuyers is that the builder had agreed to pay the Pre-EMI till they hand over the possession of the units and is now defaulting to pay the same. The banks, as a result, have started asking for payments from the buyers directly even though the projects have been substantially delayed and are nowhere near completion.
Its latest direction to restore CIBIL ratings came in the light of the earlier stay, where the court noted that the petitioners “appear to have been left in the lurch and despite paying the advance amount and investing their hard-earned money to purchase their own residential homes, the construction of the residential flats/apartments have not been completed till date.”
The HC had also faulted the banks for ignoring advisories of the Reserve Bank of India and the National Housing Bank and going ahead with the disbursal of loan to the builder when the construction was incomplete. To worsen matters the banks/HFCs were now asking homebuyers to pay the amount initially required to be paid by the developers, it said, noting that homebuyers cannot be made to suffer the consequences of this apparent collusion between the banks/HFCs and the developers.
In the latest order, justice Palli also made it clear that the interim order against coercive steps will also extend to the assignees such as the ARCs(Asset Reconstruction Companies) which can’t act against the protected.
