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SC to auction unencumbered properties of Unitech to refund money to homebuyers

Supreme Court also asked JM Financial ARC Ltd to pay Rs 25 lakh for ‘wasting the court’s time’ and diverting its attention from homebuyers’ issue

Vandana Ramnani @vandanaramnani1

Vandana Ramnani


The Supreme Court on Monday ordered embattled real estate company Unitech Ltd to furnish the complete list of its unencumbered assets in India and abroad. The company agreed to submit the list within a fortnight. The apex court will then consider auctioning these properties to refund money to distressed homebuyers.

The next date of hearing has been fixed for March 26.

The Supreme Court on March 5 had ordered the real estate firm to file a detailed affidavit with respect to its company and sister concerns’ unencumbered properties in India and abroad by March 12. It had also warned it against making any false declaration in the affidavit.

The apex court on Monday ordered that once the list was made available, it would auction those properties to raise money and pay homebuyers who are seeking a refund and whatever remains will be used for construction, said Pawanshree Agarwal, amicus curiae in the case.

The bench headed by Chief Justice Dipak Misra on Monday also imposed a cost of Rs 25 lakh on JM Financial ARC Ltd for ‘wasting the court’s time’ and diverting its attention from homebuyers’ issue.

Dismissing the intervention application, the court directed JM Financial ARC Ltd to deposit Rs 25 lakh as it was not in the interest of justice for them to move such an application and waste the court’s time and divert the court’s attention to such financial institutions instead of focusing the issues pertaining to homebuyers, said Varun Chopra, a Supreme Court advocate.

Last week, Unitech had informed the Supreme Court through its counsel that JM Financial Asset Reconstruction Company has evinced interest in financing its under-construction projects to which the court ordered that its managing director be present at the next date of hearing. It’s counsel Mukul Rohatgi and Ranjit Kumar had informed that the company had signed a deal with JM Financial Ltd which would enable it to complete under-construction projects and allot flats to buyers.

As with regard to the civil matter, the court ordered that the Rs 30 crore that has been submitted in court should be distributed on the pro rata basis, Agarwal said.

The SC last week had asked Pioneer to deposit Rs 40 crore, Rs 30 crore by March 30 and the balance by April 5 for development of its Gurgaon-based housing projects. It said, “The said amount shall be distributed amongst homebuyers who have claimed refund in respect of the concerned projects before the national commission.”

The co-developer, Pioneer, through its counsel submitted that there was a development agreement between it and Unitech for a Gurgaon project under which its liability was limited to only 40 percent whereas Unitech’s liability was 60 percent. The co-developer has contested National Consumer Disputes Redressal Commission’s (NCDRC) orders under which it was asked to discharge 100 percent liability, sources said.

Last year, the SC had told Unitech that it would consider grant of interim bail to Chandra if the company deposited Rs 750 crore in court by December.

On January 29, Unitech had informed the Supreme court that it had finalised a Rs 400 crore deal for the sale of two land parcels in Chennai that would enable it to complete unfinished projects and refund buyers.  Omshakthy Agencies Pvt Ltd has been asked to deposit Rs90 crore for the sale of land in Chennai by March 31.

The real estate company was required to deposit Rs 750 crore by December to secure bail for Chandra, who is in jail in a case of alleged forgery lodged by buyers of a Unitech housing project in Gurugram. It has deposited Rs 18 crore till date.

Chandra is seeking interim bail from the apex court after the Delhi High Court on August 11 had rejected the plea in a criminal case lodged in 2015 by 158 home buyers of Unitech projects' -- 'Wild Flower Country' and 'Anthea Project' -- in Gurgaon.
First Published on Mar 12, 2018 03:16 pm
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