SC directs attachment of more properties of Amrapali group 

A view of the Supreme Court of India in New Delhi - Nov 12, 2018 (Image- PTI) (2)

A day after the Amrapali group Chairman and Managing Director admitted to having diverted Rs 2,996 crore to other companies to expand his businesses, the Supreme Court on December 5 directed more properties of embattled firm Amrapali be attached and asked the Debt Recovery Tribunal to sell the assets, legal sources said.

The next date of hearing is on December 12.

In its interim direction, the apex court ordered attachment of Amrapali’s five-star hotel, a fast moving consumer goods company, a corporate office and malls and ordered DRT to sell them. All luxury cars of the directors have also been attached.

Last month, the bench had ordered attachment of a multi-speciality hospital located in Greater Noida, an office complex in Sector 62, Noida, a villa in Goa and some accounts of the company.

The apex court also directed the promoters and directors of the company to deposit money lying with them by December 10, sources said.

Directors of the embattled firm have also been given 24 hours to submit all the raw data invoices  - financial details to forensic auditors, they said.

Forensic auditors have been directed to send individual notices to homebuyers whose bookings they feel are not genuine and have been told that if the buyers do not respond, their booking would be construed as not being genuine, sources said.

NBCC has also been asked to file a status report.

In an affidavit submitted to the apex court on Tuesday, CMD of the company has admitted to a diversion of funds amounting to Rs 2,996 crore to other companies for expansion purpose. This he said in his affidavit had led to a financial crunch and was the main reason why housing projects had not been completed.

As many as 15 companies received Rs 11,573 crore from homebuyers and it raised Rs 4,040 crore from financial institutions and foreign direct investment.

Sharma also said his family received crores as salary and professional charges and Rs 13 crore was used to purchase 86 luxury cars. He received a salary of Rs 44 crore in the last decade and his company paid income tax of Rs 5.5 crore on his behalf.

He said in his affidavit that his present assets are worth Rs 12 crore out of which Rs 29 lakh have been deposited in 17 bank accounts.

Rendering an ‘unconditional apology for any acts of commissions to comply with the orders,” Sharma in his affidavit has claimed neither the group company nor the provider and their family members possess or even possessed any immoveable/moveable property outside India or abroad.

As for the reason for transferring funds, he said the company faced several issues related to land acquisition disputes between farmers and authorities. The affidavit said the projects were near completion and repayment of bank loan became the utmost priority for the company at the relevant time. This was the prime reason for transferring funds from one group to another group company for maintaining cash flows in the form of inter-company deposit and share capital.

As many as 15 luxury cars and 71 vehicles were purchased between 2009 to 2015. As per the affidavit, most of the vehicle were transferred/sold in 2017 because of non-availability of resources to pay long pending dues of employees/creditors as the depreciated value was too low and even vehicles could not be repaired or maintained by the company.

Forensic auditors had last month identified five properties purchased by the money siphoned off from home buyers – these include an Amrapali hospital, two commercial towers in Greater Noida, a property in Goa by the name of Eklavya and an industrial plot in Greater Noida called Gaurisuta. DRT had been advised to conduct a valuation and sell all these properties.

The top court last month had asked the Chief Financial Officer Chander Wadhwa to deposit Rs 11.69 crore with its registry within three weeks. It also asked a statutory auditor Anil Mittal to pay Rs 47 lakh.

It had also restrained the embattled firm from alienating its companies through which it had transactions and ordered attachment of such firms. It had also directed that it cannot create any third party rights for 86 luxury cars and SUVs purchased from the company's funds. The court had also directed the firm to disclose to whom these cars have been sold.

On October 31, the apex court had directed the Amrapali Group to disclose the names of all the companies with which it had any kind of transactions after forensic auditors pointed out that there may be a web of more than 200-250 such firms where home-buyers' money was transferred.

The two forensic auditors, appointed by the court to look into the affairs of Amrapali Group had said besides 47 sister companies, they had come across 31 companies whose names were never disclosed by the embattled real estate firm.

On October 26, the apex court had grilled the CFO and internal auditors of Amrapali Group over diversion of home buyers money and ordered that the company's CMD as also its two other directors would remain under police surveillance at a hotel in Noida.

It had also initiated contempt proceedings against the group's Chairman and Managing Director (CMD) Anil Kumar Sharma and its directors for prima facie violating court's order and thwarting the course of justice.

The court is seized of a batch of petitions filed by home buyers who are seeking possession of around 42,000 flats booked in projects of the Amrapali Group.