Protection of Flat Buyers
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Orbit Corporation Limited launched a project called Orbit Residency Park in 2010 to construct residential flats. Orbit was one of the prominent builders in Mumbai at that point in time. The building work had stopped more than 3 years ago because of default in repayment of loan that Orbit had taken from LIC Housing Finance. LIC Housing Finance did not do its job by diligently monitoring the loan account and as a result, Orbit instead of constructing the flats diverted the funds to other activities. Buyers were not aware of such transactions and genuinely kept making payments to the builder as and when demanded and more than 7 years have passed since the project was launched.
There are more than 300 flat buyers whose hard-earned money is at stake. MD of Orbit went to jail for about 10 months due to fraud and is out on bail. The matter is currently under investigation by the Enforcement Directorate. In the meantime, LIC Housing has been trying to auction the property taking advantage of the SARFAESI Act, completely ignoring the flat-buyers' plight.
Flat buyers have approached various courts to protect their interests with not much success. Now these financial institutions are contemplating of approaching NCLT to liquidate the company. This is completely against the interest of the flat-buyers. This will shatter common man as he was not a party to the transaction and there is no protection to the flat buyers at all.
This situation is threatening a large number of flat buyers across the country. Genuine flat buyers are made to suffer and lose their hard earned money due to such fraudulent practices. Liquidating the company is not the solution as it is adversely affecting genuine flat buyers who have booked these flats and registered them with the sub-registrar.
It is necessary that PMO and finance ministry intervene in the matter and stop these financial institutions to cover up their mistakes by approaching NCLT and putting a large number of flat buyers to lose their life savings. It is necessary that the financial institutions are directed to negotiate with the flat buyers and the builder for a mutual settlement.
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