LIC Housing Finance has settled loan dispute with DB Realty and also withdrawn its application before the National Company Law Tribunal to start insolvency process against the builder for recovery of Rs 31 crore debt. In a filing with the BSE, DB Realty informed that the company and LIC Housing Finance have “arrived at a settlement and have executed a debt settlement agreement”.
“Pursuant thereto, LIC has on October 16 withdrawn an application made by it in the National Company Law Tribunal (NCLT) Mumbai against DB Realty and the said application by LIC therefor stands disposed off as withdrawn,” the filing said.
DB Realty said that there are no bankruptcy proceedings pending against the company. LIC Housing Finance had filed an application before the NCLT to start insolvency process against DB Realty for recovery of Rs 30.63 crore outstanding loan.
Earlier, DB Realty had said the company availed of Rs 200 crore loan from LIC Housing Finance Ltd in January 2010 and out of that, Rs 188 crore were disbursed to it.
The developer had repaid Rs 157.37 crore to LIC Housing Finance within 18 months from the disbursement and the balance loan outstanding remained at Rs 30.63 crore. In the Delhi-NCR property market, insolvency proceedings have started in Jaypee Infratech and Amrapali group company.
The real estate sector is facing a multi-year demand slowdown, resulting in huge delays in delivery of flats, forcing buyers to go on protest at sites and file legal cases in courts. Many developers have defaulted in repayment of their bank loans.