Lotus buyers brace for crisis, plan to approach high court
The arrest of three directors of 3C company for Rs 191 crore funds diversion has set alarm bells ringing among buyers of the company’s incomplete projects in Noida and Gurugram.
None of the 3C company’s ‘Lotus’ brand projects is complete except Lotus Espacia, which itself is facing complaints from buyers over shoddy construction.
The three directors — Nirmal Singh, Vidur Bhardwaj and Supreet Singh — were arrested by Delhi Police on Saturday on the basis of an FIR lodged by buyers of Lotus 300, a luxury residential project in Sector 168, Noida. The buyers of the project are now worried about its further construction and delivery.
“We are planning to file an FIR at the Delhi high court on behalf of all Lotus buyers. Since money has been siphoned off from almost all projects, there has to be a mechanism to hand over the completed projects to buyers under legal supervision,” said Lalit Khanna, a buyer at Lotus Greenopolis, Gurugram.
The other projects of the group which are in a limbo are Lotus Panache, Lotus Boulevard and Lotus Zing in Noida. In Gurugram, Lotus Greenopolis and Lotus Woodview also remain incomplete. However, the projects in Gurugram have been promoted in partnership with Orris.
Another project, Lotus City, also with Orris, proposed along the Yamuna Expressway, has not started yet. According to PSP Legal, the legal representative of all Lotus buyers, the financial mishandling has affected at least 8,000 families.
According to lawyers at PSP Legal, even as the builders are facing police inquiry on the basis of a complaint filed by a Lotus 300 buyer, complaints from buyers of other residential projects are pending with the Delhi Police.
The Lotus projects were launched in 2010-13. The buyers later approached National Consumer Disputes Redressal Commission, the economic offences wing of Delhi Police, Allahabad high court and Real Estate Regulatory Authority (Rera) seeking justice.
The Uttar Pradesh Real Estate Regulatory Authority (UP-Rera) has ordered refund for some buyers of Lotus Panache, which the builder has not acted upon.
“The 3C Company has been building these apartments under ‘Lotus’ brand through shell companies. As per our research, all three promoters have exited from directorship of these companies in 2018, even though they continue to be invested in them. Rera has not been effective so far because the refund orders have not been honoured by the builders. Financial diversion from each of the projects is possible, which the court would reveal in due course,” Aditya Parolia, partner, PSP Legal said.
According to the lawyers, the operational model of 3C is such that the land and licence are with the company, but the development work is done by another company.
Lotus Panache and Lotus Boulevard are being developed though Granite Gate Properties Pvt Ltd. Lotus Panache is the company’s biggest project with 30 towers, of which 10 have been handed over.
The Noida administration had recently ordered seizure of properties of the group to pay off buyers Rs 34 crore worth interest accrued over non-completion of projects.
“All buyers expect the projects to be completed. However, we do not see any possibility for the same unless the government steps in through one of its building agencies to drive them to completion,” Gautam Chawla, a buyer of Lotus Panache, said. “There should be a proper investigation on how funds from 3C projects were diverted to fund other projects,” Sumit Saxena, a Panache buyer added.
“Finally law is taking its course. We hope that a resolution is found. We have given 3C group enough time to complete the projects. We are ready to cooperate with the builder to finish the projects if they have the intent to do the same,” Amit Chauhan, a buyer at Lotus Panache said.