Around 50 homebuyers in Greater Noida's Shahberi area have decided to stop paying their monthly installments on bank loans over legality of construction of their flats.
These homebuyers had in December 2018 written to RBI, Union Finance Ministry National Housing Board (NHB), Uttar Pradesh government and CBI, among others, urging them to intervene in the case and the decision to not pay the EMIs was taken after they got no response from any of the agencies, their lawyer said.
"These 50 people were sold flats by builders in Shahberi area and they were given home loans by various banks and housing finance companies (HFCs)," advocate Prabodh Shukla said.
"Eventually they were told by the local Greater Noida Authority that their registries are void because their properties are in a notified area and done after section 4 proceedings in violation of the status quo order passed by the high court of Allahabad passed in Arsh Sahitya Prachar Trust versus State of U.P & Ors and were illegal construction," he said.
Shukla said the homebuyers are paying anywhere between Rs 15,000 to Rs 25,000 per month on loans ranging from Rs 15 lakh to Rs 25 lakh but have been informed by the Greater Noida Industrial Development Authority (GNIDA) that their flats could be demolished "as they are illegal construction".
"The homebuyers have claimed that GNIDA officials and bank officials had flouted guidelines to allow illegal construction and disbursing loans on such projects in violation of circular no. 18 of the NHB and master circular 2015 of the RBI," he said.
According to the guidelines, the architect appointed by the bank or the HFC before disbursement of the home loan shall certify that the construction is as per sanctioned map or building bye-law.
In the present case, banks and HFCs don't have an architect on the their panels who can certify the legality of the construction, Shukla alleged.
On July 17, 2018, two adjoining buildings in Shahberi village collapsed, leaving nine people, including a child and two women, dead.
Probe reports by administration and local authorities found that the building had come up illegally and without any proper approval, as did several others over the years in Shahberi, less than 50 km from Delhi.
So far, around 86 FIRs have been registered over illegal construction in Shahberi and action taken against 42 builders under the Gangsters Act, a senior official said.
Notably, Uttar Pradesh Chief Minister Yogi Adityanath had in July directed officials to ensure tough action against rogue builders and erring government officials.
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