Centre bans import of pet coke in Delhi region

Cement plants and other industries approved to use pet coke in the region would also need to obtain permission from the state pollution control board to continue operations.

BY: Aditi Shah and Sudarshan Varadhan

NEW DELHI - India's environment ministry has placed restrictions on the use of imported petroleum coke in the capital Delhi and its surrounding region, in the latest effort to curb rising air pollution.

As the world's largest consumer of petcoke, India imports over half its annual pet coke consumption of about 27 million tonnes, mainly from the United States. Local producers include Indian Oil Corp, Reliance Industries and Bharat Petroleum Corp.

"Only consented and registered industrial units of NCR States shall be permitted to directly import petcoke and consignment shall be in the name of user industrial units for their own use," the ministry of environment, forest and climate change said in a notification issued late on Friday.

Cement plants and other industries approved to use petcoke in the region would also need to obtain permission from the state pollution control board to continue operations, it said.

The ministry has also banned imports of petroleum coke for trading purposes in the capital region, the notice said, adding that even industrial units allowed to use petcoke will not be allowed to store more than three months worth of their consumption.

India will also track the trade of the commodity, and has asked both sellers and consumers to submit monthly reports on petcoke-related transactions.

India is the world's biggest consumer of petroleum coke, which is a dark solid carbon material that emits 11 percent more greenhouse gases than coal, according to the Carnegie-Tsinghua Center for Global Policy.

India's government is in favour of imposing a wider ban on the import of petcoke, according to a government affidavit filed with its top court in December, a ruling on which is expected next month.

(Editing by Andrew Bolton and Alexander Smith)

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JSW highest bidder for Binani Cement

While the bids were revealed to the committee of creditors two days ago, banks will take a final call on the winner in the coming days

MUMBAI: Sajjan Jindal’s JSW Group has emerged as the highest bidder for Binani Cement, exceeding submissions from billionaire Rakesh Jhunjhunwala and UltraTech, said three people familiar with the development. JSW’s bid is worth about Rs 5,900 crore, they said.

While the bids were revealed to the committee of creditors two days ago, banks will take a final call on the winner in the coming days. The lenders have appointed consulting firm Alvarez & Marsal to evaluate bids. Bankers are confident Binani is one asset that they won’t lose money on.

ET reported on January 16 that cement makers such as UltraTech, Heidelberg, JSW Group, Dalmia Bharat and Ramco Cements besides Jhunjhunwala had made proposals to acquire assets of the debtridden company. Dalmia Bharat partnered billionaire Ajay Piramal to bid, while JSW submitted its proposal jointly with a private equity firm and Ramco Cement tied up with PE fund True North.
‘No Haircut’

“We have received several bids ranging from Rs 4,500 to a little less than Rs 6,000 crore, which is enthusing,” said a bank official. “I always maintained that we won’t have to take a haircut on this transaction. We will have to study these proposals very carefully to see which the best fit is.”

JSW declined to comment on the matter.

Parth Jindal, JSW Cement managing director, told ET earlier this week that the group would “aggressively bid for stressed assets in cement, steel, and power that are undergoing bankruptcy proceedings”.

Lenders have made a claim of Rs 3,884 crore on the company. This includes loans acquired by Edelweiss Asset Reconstruction Co from banks and dues to State Bank of India, Canara Bank and Bank of Baroda. Apart from this, the company also faces claims of Rs 2,429 crore from IDBI Bank and SBI in the form of corporate guarantees.

JSW Cement is looking to increase production capacity in West Bengal to 3.6 million tonnes (mt) per year, up from the current 2.4 mt at an estimated investment of Rs 300 crore. The company has already invested close to Rs 800 crore in a 2.4 mt grinding plant at Salboni in West Bengal. It will also invest close to Rs Rs 100 crore for setting up an 18 MW captive power plant. Binani Cement has a production capacity of close to 11mt, of which nearly 6 mt is in India. It has a grinding unit in Dubai and a plant in China.

Bank of Baroda had referred Binani Cement to the National Company Law Tribunal (NCLT) in July, after the unlisted subsidiary of Binani Industries failed to repay a Rs 97-crore loan to the lender. Bank of Baroda then appointed Vijaykumar V Iyer as the resolution professional. Originally, the resolution professional set December 22 as the last day for submitting a binding bid for the company, but this was extended to January 15 following requests from companies that had shown interest in the assets. In November, as many as 15 companies, including some international players like France’s Lafarge and Dublin-based CRH, had submitted expressions of interest for Binani.

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SC stays ban on sand mining in Rajasthan; housing projects remain in limbo

The ban has not only impacted the private housing sector but also delayed the deadline of several of state government’s ambitious projects

JAIPUR: Infrastructure and private housing projects in the state worth approximately Rs 10,000 crore would continue to remain stalled for nearly one-and-half months more after Supreme Court did not provide relief to the state government.

The ban has not only impacted the private housing sector but also delayed the deadline of several of state government’s ambitious projects.This situation is expected to be grimmer due to interrupted supply of sand (bajri) for minimum of two months.

Uptight over the situation to complete projects on stipulated time after coming in the Real Estate (Regulation and Development) Act ambit, the developers have already approached tothe urban development and housing (UDH) minister Srichand Kriplani. However, continuous delay is affecting the project cost.

“Bajri is most essential requirement for construction. In absence of availability, construction of projects are on hold. Though we have apprised the UDH minister about the situation and demanded time relaxation, our project cost is increasing due to delay,” said Shaleen Singh, a private developer.

Other than developers, unavailability of bajri for construction is also posing serious problems for thousands of labourers, workers and consumers. Some developers added that nearly 5 lakh labourers, including migrant labourers depend on construction and allied industries. “There is no demand for labourers coming from villages for the past two months,” said Ratan Singh, a small businessman associated with construction industry.

The dramatic drop in construction activities after the ban is also having a cascading effect on other related businesses. “Just after the ban, business has gone down by 85% as there are few buyers for bricks, cement and other material required for construction,” said Abhishek Sharma, associated with the construction business.

The ban has also raised concern for civic body officials as many development projects in the city are being choked and are racing against time to meet the deadline. Currently, projects like Metro Phase I(B), affordable housing scheme, elevated road (Ambedkar Circle to Sodala) and rejuvenation of Dravyawati River are underway.

A senior JDA engineer said, “As there is no supply of sand, construction work cannot be taken up further. Approximately 1,200 cubic metres of sand is required every day for infrastructure projects,” he said.

After the Supreme Court ban, officials are a concerned lot as there is no reliable and tested alternative.

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No possession date, no RERA relief, rules MahaRERA

Home buyer Prem Chand had booked flat 203 in SD-1one of the 16 eight- storeyed buildings in Indiabulls Savoli Golf City project located off Khalapur toll naka on the Mumbai-Pune Expressway

Maharashtra Real EstateRegulatory Authority (MahaRERA) has dismissed a complaint from a home buyer against India Bull Real Estate Ltd for delayed possession ruling that since no possession date was given by the developer, RERA provisions do not come into play to provide any relief.

Home buyer Prem Chand had booked flat 203 in SD-1one of the 16 eight- storeyed buildings in Indiabulls Savoli Golf City project located off Khalapur toll naka on the Mumbai-Pune Expressway. In his complaint to MahaRERA, he said he had paid the booking amount of Rs two lakh on September 26, 2012, and paid another tranche of Rs 2.5 lakh to complete 15 per cent of the flat cost as agreed, while the rest of the 80 per cent finance for the flat was to come in the form of a home loan from Indiabulls Housing Finance Ltd. Since the developer had failed to give possession five years later, Prem Chand had sought refund of his investment with interest and compensation which works out to Rs 1.20 lakh.

During the hearing, the developer’s say was also recorded, and an opportunity was given to the home buyer to present any official document that showed the agreed date of possession. However, Chand could not produce either an agreement with the developer or any other document which indicated the agreed date of possession. Indiabulls, however, has mentioned July 1, 2017 as the original date of possession and revised it to February 28, 2019 while registering the project with MahaRERA.

“Section 18 of RERA Act comes into picture only when the promoter fails to complete or he is unable to give possession of the apartment in accordance with the terms of agreement for sale or duly completed by the date specified in the agreement. Here in this case, there is no document or any contention of the complaint showing the agreed date of possession…Therefore, in this circumstance, Section 18 is not applicable,” Kapadnis said in his order.

In a separate case concerning Shree Siddhivinayak Platinum Park project in Undri, Pune, Kapadnis asked the developer Ranjeet Developers to refund Rs 15.87 lakh and Rs 15.73 lakh to two home buyers with 10.15 per cent interest from the date of their payments for delayed possession. Home buyers Atul Deshpande, and Ravindra Patankar had booked flats E-6 and E-01respectively in Shree Siddhinayak Platinum Park project phase I with the promise that they would be given possession before September 30, 2015, but the developer had failed to give possession. The developer contended that the project was delayed because the mandatory environmental clearance certificate was delayed.

The developer also argued that the delay was beyond his control.

Upholding the right of the home buyers to get a refund of their investment, adjudicating officer Kapadnis observed that from the facts of the case, it is clear that the developer had agreed to deliver possession on or before September 30, 2015, and had failed to do so. He said till May 2012, the developer had only Non Agricultural land order from the Assistant Director of Town planning but the developer went on to collect money from the home buyers.

“When they did not have the approvals of the competent authority for making the construction or when they did not have the environmental clearance certificate, they were not entitled to recover any money from the allottee (home buyer) They were running their own risk and therefore only because some delay is caused for one reason or other for getting approvals, they cannot blame the system as such to seek exemption from the payment of interest,” his order said.

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NHB pitches for lowering GST rate for affordable housing

The regulator is likely to push for lower GST rates for affordable housing category especially although the general category is also under consideration at an effective rate of 6%

MUMBAI: The housing finance companies’ regulator National Housing Bank is in talks with the authorities to lower the effective Goods & Services Tax (GST) rate from current 12% after factoring the lowering of land prices that could ease the tax burden and help in prop up residential sales, two persons familiar with the development said.

The regulator is likely to push for lower GST rates for affordable housing category especially although the general category is also under consideration at an effective rate of 6%. It is said to have written to finance ministry on the issue.

Realtors have also recently met finance and housing ministry officials to suggest a similar change in the current GST rate. At present, under-construction properties attract 18% GST and allow abatement of one-third of the apartment value towards land cost taking the effective tax rate to 12%.

“While several stakeholders have been requesting for lower GST rate for under-construction properties, NHB is of view that at least low-cost and affordable housing need to be given the benefit of lower rates,” said one of the persons cited above.

An email query to NHB seeking comments for the article remained unanswered until the publication of this report.

“Lowering GST would lead to improvement in demand for under-construction homes. However, the government will consider and review its revenue implications before any final call. It may also be possible that lowering of tax burden may result in excess credit in builder’s hand which would become a cost for them and ultimately homebuyers will have to bear it,” said Abhishek Jain, tax partner, EY India.

Realty developers said the reduction in GST would help in incentivizing end users to buy under construction properties. Most homebuyers are now giving preference to ready-to-move-in apartments to duck the tax.

“The government will earn more tax revenue if the rates are dropped to 6%. In this case, more buyers will come forward to buy under-construction properties than waiting for completed apartments that do not attract GST,” said Niranjan Hiranandani, CMD, Hiranandani Group.

Industry experts say the gap between tax rates for a ready property and an under-construction property has led to drop in demand for the latter. The GST rate for under construction properties is 12% while ready properties with completion certificate or occupation certificate do not attract GST.

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