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Supreme Court calls Amrapali Group 'worst kind of cheater', 'perfect liar'

The apex court on Wednesday also ordered the attachment of all its properties created out of homebuyers' money and asked the Debt Recovery Tribunal (DRT), Delhi, to auction them.

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Supreme Court calls Amrapali Group 'worst kind of cheater', 'perfect liar'

Two weeks after the Supreme Court accused the debt-ridden Amrapali Group of "hood-winking" it, the top court has gone a step further and called it out as the "the worst kind of cheater" and "a perfect liar" for non-compliance with its orders. But derogatory adjectives are the least of the real estate firm's worries.

The apex court on Wednesday also ordered the attachment of all its properties created out of homebuyers' money and asked the Debt Recovery Tribunal (DRT), Delhi, to auction them.

The Group diverted money invested by 46,000 homebuyers in its various projects into building other properties such as a five-star hotel in Greater Noida, malls in Uttar Pradesh and Bihar, resorts and an FMCG company, apart from buying land across the country, The Times of India reported. The Group claimed to have invested Rs 411 crore in the 28 attached properties, including four swanky corporate offices, which are now worth Rs 964 crore.

In a comprehensive affidavit placed before the Supreme Court, Amrapali Group Chairman and Managing Director Anil Sharma admitted diversion of Rs 2,996 crore to other group companies, due to which the group reportedly faced a financial crisis and, hence, could not complete its housing projects in time, leaving homebuyers in the lurch. The real estate giant is involved in construction of various housing projects including 170 towers in Noida and Greater Noida.

According to the daily, the Group said that its 15 companies received Rs 11,573 crore from homebuyers and it raised additional Rs 4,040 crore from financial institutions as well as the Foreign Direct Investment route. It claimed to have invested Rs 10,300 crore in those housing projects.

In its latest directive, a bench of Justices Arun Mishra and U.U. Lalit offered the firm's directors and their family members a chance to return homebuyers' money, if they have it, by December 10. However, PTI reported that it also issued notice to Sharma and the Amrapali Group's directors, Chief Financial officer and statutory auditor Anil Mittal, asking them why a criminal case for breach of trust should not be lodged against them.

"You [Amrapali Group] are a worst kind of cheater in the world. You have cheated the homebuyers all along and now you want to sell the facilities created for them. The facility area created for the homebuyers is not a charity you have done to them," the bench said after senior advocate Geeta Luthra appearing for the Group suggested that facilities areas in various housing projects - including a nursery school and a nursing home - could be sold by the realty firm to raise funds.

Furthermore, perusing the submitted affidavit, which runs into hundreds of pages, the bench pointed out that it failed to outline the money trail of diversion of funds and pinpoint the people who were beneficiaries of the transaction. "We are not getting any idea on how the money was transferred and whether it was approved by Board of Directors," the court said.

It also questioned why the Group only revealed fund diversion till March 2015 while investments in the construction of housing projects and other business transactions continued up to 2018.

"You are a perfect liar. You are a first degree liar. You have not given specific information what we have asked for in our earlier orders. We are not satisfied with your affidavit and you have only tried to manipulate the things. Despite our nine orders, you have not given specific information about business transactions for period 2015-18," the bench said.

The daily added that the forensic auditors appointed by the Supreme Court to probe the financial irregularities of the Group, Ravi Bhatia and Pawan Kumar Aggarwal, also expressed surprise over the submitted documents, adding that they were seeing such documents for the first time in their professional life and not a single figure given by the Group matched bank statements. According to Aggarwal, as per the documents, the promoters did not invest a single rupee in the company - the vast empire appeared to be created entirely out of homebuyers' money.

When the top court asked Amrapali Group to disclose the name of the person who had prepared the documents in order to examine him/her, the company initially chose to remain silent but later furnished the names of five persons, including two chartered accountants, who had prepared the report.

"You are in trouble now. Enough is enough. We would not spare you. You are manufacturing the data," the bench reportedly said then, giving the Group 24 hours to hand over the raw data files of all the business transactions of the company for the period of 2015-18, including the vouchers, receipt and the required authorisation, to the forensic auditors.

On being told that there were suspicions of 'benami' homebuyers who have booked the flat at the paltry sum, the bench directed the forensic auditors to investigate the affairs of the company, to issue a notice owner of the flat and if no response is received then that property should be put on sale.  

Apart from the 28 properties attached yesterday, the Supreme Court last month had attached the Group's multi-speciality hospital, its bank accounts, certain firms and a "benami" Villa in Goa. It had also restrained the beleaguered company from creating any third party rights for the 86 luxury cars and SUVs purchased using company funds.

Edited by Sushmita; With PTI inputs

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