NCLT rejects Wave Group’s appeal for initiating insolvency proceedings

Earlier last week the National Company Law Appellate Tribunal (NCLAT) rejected Wave’s Group’s appeal against insolvency proceedings initiated, thereby allowing Noida Authority to auction over 1 lac square meters of cancelled land in sectors 25A and 32 that was earlier allotted to the builder. The builder may still apply for restoration of the land and take advantage of the reschedulement policy under Noida Authority to clear pending dues and complete the stalled projects. The aggrieved investors are prepared to file a caveat with the Supreme Court should the developer choose to do so.

In March 2011, Noida Authority allotted over 6 lac square meters of land to Wave Megacity in Sectors 25A and 32. The developer paid 10% of the land cost but failed to complete construction of the project. The developer also failed to pay the remaining dues of the land cost. In 2017, under the state government’s project settlement policy, Wave Group applied to return the land on account of them being unable to construct. In doing so, it surrendered approximately 4.54 lac square meters. In March 2021, Noida Authority seized another 1.08 lac square meters allotted to the developer over failure to clear dues amounting to Rs 2,500 crores upon which the developer filled an application with the NCLT. This application was rejected in June 2022. Wave Group challenged this decision in the appellate tribunal which was dismissed last week.

At present, Wave Group has approximately 56,500 square meters of land in its possession where its mammoth project Mega City Centre resides. This complex includes High Street Shops and Amore Residential Society. Residential projects by the name of Trucia, Irenia and Vasilia remain under construction. Of the land seized by authorities, majority is vacant save two under construction towers namely Livork Studios and Metromart. Homebuyers of these towers have been given the option of a refund from the UP RERA Authority or the option to pick an alternative development of the builder in Mega City Centre.

Wave Group is yet to release an official statement in response to NCLAT’s latest order. According to an expert who spoke to the TOI, the company is eligible to seek restoration of land by paying only 10 percent of the dues which amounts of Rs 174 crores approximately. Home buyers are worried that in the on-going battle between the developer and NCLAT, their interests are being squashed. Members of the Wave City Centre Homebuyers Association are planning to file a caveat with the Supreme Court to safeguard their interests and ensure they are no lost in the cross-fires.

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NCLT rejects Wave Group’s appeal for initiating insolvency proceedings

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