What do you guys think about Jaypee Greens Wishtown - NOIDA? Is this a good time to buy? Is Wishtown a good investment?

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  • Originally Posted by Bharatiya
    If Banks really had the leverage over land. All they need to do is to write to NA asking for stopping the registration process.

    Any stake holder can stop the registration process of property in question.

    My point has always been that Banks have no authority over private property. That's why they have not interfered in allotment and registration of properties.



    Any legal rights of stake holders in a property are CLEARLY mentioned in Conveyance deed.

    Mr Dinesh, do you have any clause in your conveyance deed that ICICI Bank reserve the right to exercise any control over your property? I am sure NOT.

    So Mr Gandhi,

    I acknowledge your concern about WT. Doubts over completion of projects. Maintenance and Internal Infrastructure. Banks power to seize UNSOLD and UNALLOTTED land. These are real problems.

    But you saying that Banks can seize private property of home owners. This is just too far fetched and preposterous argument.

    Mr Bharatiya, please show me where I said banks can seize private property. I only said if a bank held a lien on a land parcel ( especially if it was a first and exclusive charge) and that land was subsequently sold to someone else without releasing the lien and the borrower then defaulted on the loan, then banks do have a case to go to court and press their lien. I have already said I am not an expert on the nuances and don't know how such a claim will be adjudicated. But in such a case, banks will definitely be at least given a hearing by the courts since they do have some sort of prima facie claim.
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  • Wow the argument happening here is so amateurish it is not funny. I will not go into details. Has anyone studied how corporate lending works? Banks don’t give money against all assets they lend against certain assets. Debt is issued against long term assets and not assets that will be realized in the short term. The “launched properties” are realizable short term assets as this is the land that is intended to be sold to customers and therefore sits in the “current assets” or “Inventory” and not long term assets of the balance sheet.

    One last thing. If you buy an apartment from Jaypee for $100 and you pay them $95 and pending possession and registry you are one of the creditors of Jaypee. Your $95 will stand in the liabilities of the company until they deliver the unit to you. At the time of delivery when you pay the remaining $5 the $95 worth of debt (raised due to your payments) is also wiped off. This is something everyone here is ignoring. All money raised from sold undelivered inventory is standing as debt and the sold inventory is standing as current assets/ inventory.

    Banks do not lend against short term assets and if they do (extreme case) they take “charge” of the asset making sure the asset is immovable. This is called a Hanging Charge. In this particular case the bank will hold the title of the land and will not give the builder relevant authority to move the land. If Jaypee goes bust the bank would have first right to the asset ahead of all creditors. The fact that Jaypee is giving possession to people suggests this is not the case here.

    Rather than everyone speculating I would suggest people understand the situation. Banks are not little kids and unless a major accounting scam is going on there is nothing to see here.
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  • Originally Posted by dineshsays
    For a second I thought it was pkgandhi; again with another of his FACT-FILLED posts


    Nahi yaar, I mean people write anything. Kuch bhi!! Its like a swinging pendulum between the stupid enough to be hilarious and the ridiculous enough to be agitative. Reminds me of a movie which i had the agony of watching, Housefull 2.
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  • Originally Posted by pkgandhi
    I have already said I am not an expert on the nuances and don't know how such a claim will be adjudicated. But in such a case, banks will definitely be at least given a hearing by the courts since they do have some sort of prima facie claim.


    Can you sight any example? Case where Bank has dragged owner of private property in court because Builder failed to make full payments of Project.

    As far as i know, i have never heard of any cases where Banks have involved buyers of properties in court case just to recover loan payments of Project from Builder.

    Banks do have lien over assets (pool of land etc). I don't deny it. But that lien extending towards buyers of Apartments? Or maybe even superseding those actual buyers? That i have never heard of.
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  • Originally Posted by Imperialnoid
    Wow the argument happening here is so amateurish it is not funny. I will not go into details. Has anyone studied how corporate lending works? Banks don’t give money against all assets they lend against certain assets. Debt is issued against long term assets and not assets that will be realized in the short term. The “launched properties” are realizable short term assets as this is the land that is intended to be sold to customers and therefore sits in the “current assets” or “Inventory” and not long term assets of the balance sheet.

    One last thing. If you buy an apartment from Jaypee for $100 and you pay them $95 and pending possession and registry you are one of the creditors of Jaypee. Your $95 will stand in the liabilities of the company until they deliver the unit to you. At the time of delivery when you pay the remaining $5 the $95 worth of debt (raised due to your payments) is also wiped off. This is something everyone here is ignoring. All money raised from sold undelivered inventory is standing as debt and the sold inventory as standing as current assets/ inventory.

    Banks do not lend against short term assets and if they do (extreme case) they take “charge” of the asset making sure the asset is immovable. This is called a Hanging Charge. In this particular case the bank will hold the title of the land and will not give the builder relevant authority to move the land. If Jaypee goes bust the bank would have first right to the asset ahead of all creditors. The fact that Jaypee is giving possession to people suggests this is not the case here.

    Rather than everyone speculating I would suggest people understand the situation. Banks are not little kids and unless a major accounting scam is going on there is nothing to see here.


    Lol sir, I don't know if you have any understanding of how corporate lending in India works, but dual financing is all too common.

    Since an example is worth a thousand theoretical arguments, please consider the example of kalypso court where HDFC bank holds a charge on the land against loans but Jaypee is still giving possession ( this is not my example but given by dineshsays).

    Also, since you are talking about working capital, please also consider the fact that current liabilities are much higher than current assets :-)

    Hope you educate yourself on Indian lending practices and understand the situation before making further insightful comments.
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  • Originally Posted by Bharatiya
    Can you sight any example? Case where Bank has dragged owner of private property in court because Builder failed to make full payments of Project.

    As far as i know, i have never heard of any cases where Banks have involved buyers of properties in court case just to recover loan payments of Project from Builder.

    Banks do have lien over assets (pool of land etc). I don't deny it. But that lien extending towards buyers of Apartments? Or maybe even superseding those actual buyers? That i have never heard of.


    why are you making strawman arguments, sir ? Did I say any of these things happened or will happen, but has something as huge as a JP bankruptcy happened either ? We are in unchartered waters and it is not clear how the situation will be resolved. I am just pointing out the remedies that are available to banks, should they choose to pursue them.
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  • Originally Posted by pkgandhi
    Mr Bharatiya, please show me where I said banks can seize private property. I only said if a bank held a lien on a land parcel ( especially if it was a first and exclusive charge) and that land was subsequently sold to someone else without releasing the lien and the borrower then defaulted on the loan, then banks do have a case to go to court and press their lien. I have already said I am not an expert on the nuances and don't know how such a claim will be adjudicated. But in such a case, banks will definitely be at least given a hearing by the courts since they do have some sort of prima facie claim.


    The banks would hold the title if they have exclusive charge making any transfer without their knowledge impossible. If they have first charge where multiple charges exist NOC will be required from all parties prior to transfer. Any dues relevant to the portion of the asset being moved will need to be settled prior to transfer.

    In most cases charges are issued against plant where there is no "title", Where title is involved it is very hard to move without NOC.
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  • Originally Posted by Imperialnoid
    The banks would hold the title if they have exclusive charge making any transfer without their knowledge impossible. If they have first charge where multiple charges exist NOC will be required from all parties prior to transfer. Any dues relevant to the portion of the asset being moved will need to be settled prior to transfer.

    In most cases charges are issued against plant where there is no "title", Where title is involved it is very hard to move without NOC.


    This is India sir :-) "Very hard" is very different from impossible. Please take a look at kalypso court example.
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  • I am not a owner of property in WT. But perhaps someone can can tell you about Conveyance deed of those properties. If Conveyance deed does not mention about stake of any Bank or creditor on Apartment. Then that creditor has no legal rights on that property. None whatsoever.

    Conveyance deed (Registry) and terms of conveyance deed define the ownership of property. Everything else after registration of property is irrelevant as far as ownership is concerned.
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  • Originally Posted by pkgandhi
    Lol sir, I don't know if you have any understanding of how corporate lending in India works, but dual financing is all too common.

    Since an example is worth a thousand theoretical arguments, please consider the example of kalypso court where HDFC bank holds a charge on the land against loans but Jaypee is still giving possession ( this is not my example but given by dineshsays).

    There is nothing wrong with giving possession. Say there is outstanding debt of $30 against the land. The developed Kalypso court is worth $100. The bank will give the builder NOC upto the value the bank feels comfortable with. Just because there is a charge doesn't mean the bank would block all activity. Also depending on arrangement with HDFC say Dineshsays apartment's share of outstanding debt to HDFC is 15 lakhs then jaypee will have to pay this to HDFC and get NOC BEFORE registry will happen.


    Also, since you are talking about working capital, please also consider the fact that current liabilities are much higher than current assets :-)

    I am not talking about working capital I am talking about Prepaid sold Inventory. You cannot issue charge against it. Chori to thik hai but seena zori?

    Hope you educate yourself on Indian lending practices and understand the situation before making further insightful comments.

    I agree there is a lot of hanky panky in India but reputable international auditors will not allow day light robbery to happen. Same with the banks. In such environment they would safe guard themselves above all. You can see this as they are already forcing Jaypee to clear NCA's against which loans were issued.


    Above
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  • Originally Posted by Bharatiya
    I am not a owner of property in WT. But perhaps someone can can tell you about Conveyance deed of those properties. If Conveyance deed does not mention about stake of any Bank or creditor on Apartment. Then that creditor has no legal rights on that property. None whatsoever.

    Conveyance deed (Registry) and terms of conveyance deed define the ownership of property. Everything else after registration of property is irrelevant as far as ownership is concerned.

    If everything were so simple, there would be zero property dispute cases in the courts :-)
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  • I don't know what you are trying to say.

    Simple Irrefutable fact - A party which is not mentioned in Conveyance deed as a stake holder has no legal authority over the property.

    Registration with authority is not just about paying stamp duty. It comes with terms of ownership of Property in question. And it clearly mentions role of all Stake holders (direct or indirect) of the property. This is what you call a Conveyance deed. Buyer has to obtain NOC from all stake holder for execution of Conveyance deed.

    The fact that buyers of JP Properties are getting their Conveyance deeds executed shows Banks (who loaned JP money) have no control over those properties.



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  • Originally Posted by Imperialnoid
    Above

    By double-financing I mean banks ( not necessarily the same ones) have financed both the land and retail loans on the flats to be built on it. In any case the net result is that the land is no longer unencumbered and there are multiple claims on it.

    Reputable international auditors ? Lol, sir. Firstly JP uses a small time accounting firm, which probably gets 90% of its revenues from JP. Look at the quality of their financial reporting. There is 40k crores of opaque contingent liabilities hidden away in JPA subsidiaries. In any case we have seen track record of reputable international firms in the cases of enron and satyam.
    Originally Posted by Imperialnoid
    Above
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  • Originally Posted by Bharatiya
    I don't know what you are trying to say.

    Simple Irrefutable fact - A party which is not mentioned in Conveyance deed as a stake holder has no legal authority over the property.

    Registration with authority is not just about paying stamp duty. It comes with terms of ownership of Property in question. And it clearly mentions role of all Stake holders (direct or indirect) of the property. This is what you call a Conveyance deed. Buyer has to obtain NOC from all stake holder for execution of Conveyance deed.

    The fact that buyers of JP Properties are getting their Conveyance deeds executed shows Banks (who loaned JP money) have no control over those properties.




    Sir you seem to be really thick. All I am saying that legality of a conveyance deed can be challenged in court if the challenging party can establish the execution of the deed was mala fide. The actions of Noida authority babus and registrars are not exempt from review by higher Indian courts.
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  • Most builders do pledge their land for working capital loan, when you buy a house the builder sells you a unit but when you take a home loan the bank insists on a unecumberance certificate from the builder. The builder then needs to get clearance from his banker either by paying something upfront or receivables from the buyer needs to be deposited with the bank.
    In normal course this would work if the loan is paid off by the time the house are ready for registry.
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