LIC Housing Finance re-possesses Orbit's tower for failing to repay loan
Moneylife Digital Team 02 January 2015

In a rare case of a government lender going after big fish for Loan recovery, the DRT allowed LICHFL to take over Orbit's tower for recovery

 

Following orders from the Debt Recovery Tribunal (DRT), LIC Housing Finance Limited (LICHFL) has taken over physical possession of Orbit Corporation's luxury real estate development project, Orbit Grand.
 
LICHFL said in a release that it took possession of the 35-storeyed tower on 24 December 2014, following a loan repayment demand notice issued to Orbit on 21 February 2014.
The loan in question was its Rs95 crore loan which was sanctioned with the said tower as collateral. The tower was to be an upscale apartment tower, in which even now at least 18 apartments have been left out of the mortgage.
 
Orbit Corporation said in a filing with the BSE that the DRT had allowed Orbit to continue construction work on the tower for completion of the project.
 
Managing director of Orbit Corporation Punit Agarwal and chairman, Ravikiran Agarwal were the guarantors for the loan.
 
The tower is located in Lower Parel area of Central Mumbai which has seen many major luxury real estate projects. However, many builders have faced cash crunches as a result of the slowing real estate demand and piled up inventories. Banks have also tightened lending to the sector.
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