Jaypee homebuyers’ complaints genuine, Suraksha Group breached resolution plan: Panel

New Delhi: An independent committee of experts—formed to address homebuyers’ grievances regarding Jaypee Infratech projects (now under the Suraksha Group)—raised several concerns, including handover delays, poor construction quality, fund diversion and labour shortages at the site.

In its report, the committee, set up in February, agreed with most of the allegations made by the homebuyers.

“The committee has confirmed the points we have been raising for quite some time. The Uttar Pradesh government is also doing an audit separately. This is completely unethical as the new management is claiming to have given possession when the basic amenities are not ready,” said Sanjeev Sahani, a homebuyer.


According to the report, the grievances and allegations over delays in construction and delivery of flats raised by homebuyers were found to be correct and genuine.

“The SRA (successful resolution applicant) has failed to complete the projects as promised in the resolution plan, thereby breaching its obligations for thousands of allottees. The committee is of the view that the tribunal take urgent cognizance of these lapses and issue appropriate compliance directions to ensure timely completion and delivery of units,” the committee said in the report.

Regarding the quality of construction, the committee said that upon site inspection and review of submissions, it observed that the SRA was using steel other than prime steel from SAIL and Tata Steel. In contrast, reports from homebuyers, the former interim resolution professional, and implementation and monitoring committee members confirm that prime steel was used previously.

“While the SRA has claimed to be using Fe 550 grade steel, the Committee finds the concerns of the homebuyers to be genuine. Given that the towers are 30-32 floors high and situated in an earthquake-prone zone, the Committee is of the considered opinion that quality cannot be compromised,” the report said.

Jash Panchamia, executive director, Jaypee Infratech Ltd, said the report was not in sync with the resolution plan and they were following it.

“As far as the timeline is concerned, the yardstick used by the committee is wrong,” he said. “The resolution plan talks about completion of towers and not offer of possession. In many cases, buyers are not coming forward to take possession. Similarly, on funds and labour, it depends on the requirement; if we have enough funds and labourers, there is no need to get more.”

In response to allegations regarding a shortage of on-site labourers, the committee conducted site visits across almost all project locations, holding discussions with both the responsible SRA project in-charges and their contracted partners.

The report said that at some sites, only 200-300 daily labourers were visible. “Although the SRA has submitted that more than 4,000 labourers are employed across all projects, the committee was not convinced by this claim, as the actual deployment appeared significantly lower. The committee considers inadequate labour engagement to be one of the principal reasons for delay in construction,” it said.

The resolution plan stipulated a requirement of about 12,000 labourers for timely completion of such large-scale projects.

“However, the committee’s observations indicate that only around 3,500-4,000 labourers are being utilized. This shortfall is critical, especially given the magnitude of the work, which includes 97 stalled projects comprising 10,164 residential units,” the report said.

As per the resolution plan, the SRA was required to arrange working capital of Rs 3,000 crore within 90 days for completion of the real estate projects.

“It is an undisputed fact that the SRA has failed to arrange such sanctioned working capital till date,” the report said. “The contention of the SRA—that no resolution applicant infuses working capital in toto and that infusion is always need-based—is misconceived. The distinction between having sanction of working capital and utilization of working capital has not been properly appreciated by the SRA.”

The committee said that diversion of funds to associate entities and investment in mutual funds had indeed taken place.

“This constitutes a serious breach of trust, as funds earmarked for construction were misapplied. Such diversion has been possible because the Project Monitoring Committee (PMC) is merely nominal in nature, with the SRA exercising full control over the Corporate Debtor/PMC and operating without an effective accountability framework,” the report said.

On May 24, 2024, the National Company Law Appellate Tribunal approved Suraksha Group’s resolution plan, directing the company to pay Rs 1,335 crore to the Yamuna Expressway Industrial Development Authority over four years to compensate the farmers.

Suraksha Group’s plan, submitted to the bankruptcy court in April, had originally proposed Rs 1,216 crore in enhanced compensation, with 10% payment within 90 days, 15% by the end of the first year and 25% annually over the next three years.

According to homebuyers, about 20,000 families in Jaypee Wishtown, Noida, have waited for more than 10 years for their homes.