The Supreme Court on Wednesday allowed the new board of management of Unitech Group to hold negotiations with three Asset Reconstruction Companies (ARCs), which are assigned around 8000 out of the 15,000 total flats for one time settlement of the mutually agreed dues. A bench of Justices DY Chandrachud and M R Shah said that a sub-committee of four directors constituted by the new board of management will hold negotiations with Suraksha ARC, JM Financial ARC and Edelweiss ARC, about the outstanding dues and the settlement agreement and apprise it in four weeks.
The top court also permitted the sub-committee to hold negotiations with Noida and Greater Noida authorities, which has raised objections to the resolution plan presented by the new board, about the dues and the amount payable by the Unitech Group.
Similar discussions will also be held by the sub-committee with Haryana government and its agencies on the claims and the settlement agreed, the bench said.
During the hearing, Additional Solicitor General N Venkataraman, appearing for the new board, said that currently there are 74 (residential) and 10 (Commercial) under-construction projects wherein possession of about 15,000 units has to be delivered to homebuyers.
He said that the construction and completion of the unsold stock of about 4000 units has to be taken up simultaneously and out of the total, 35 projects (comprising 5,918 sold units of which possession has to be given and another 2090 unsold units) have been assigned to the ARCs.
"For complete development of all the projects and delivery to homebuyers, it is imperative that the new Management is given permission for engagement of the PMCs, and for award of contracts, for all projects, including those assigned to the ARCs" the Additional Solicitor General said.
Venkataraman said that in view of earlier observations of the Court, claims of ARCs and Banks are sought to be negotiated by the Company, so that the outstanding dues can be mutually agreed by entering into One Time Settlement.
He said that for the said purpose, a committee of Board of Directors comprising four directors has been constituted and the said panel has been given the necessary documents and information regarding the dues and claims.
Venkataraman further submitted that pursuant to the engagement of Project Management Consultants (PMC) and award of contracts, further works can be undertaken at site only after necessary approvals are given by the statutory authorities of NOIDA, GNOIDA and Haryana government and its agencies.
"Notwithstanding outstanding claims of such Authorities, and without insisting on upfront payment, it is prayed that necessary directions be issued to the concerned authorities for renewal of license, grant of necessary permissions and sanctions of building plans, completion certificate, occupation certificate etc," he said.
Venkataraman also pointed out that since cost of construction of homes is sought to be met from the balance receivables from homebuyers, to the extent of approximately Rs.3,300 crores, it is imperative that the homebuyers make timely payment of their outstanding dues.
At the outset, the bench allowed payment of over Rs 54 lakh to M/s Grant Thornton, a forensic auditor, which was asked by the top court to assess the irregularities of Unitech Ltd. In its resolution plan, the new board of management has said that construction of 15,000 units has to be done for delivery of possession to homebuyers in three to four years and at current price levels, estimated cost of construction is Rs. 5,500-6,000 crores.
It had said that if construction is not done, then the refund claims of these home buyers will be approximately Rs 11,100 crores. The hearing remained inconclusive and would continue on Thursday.
On August 17, the top court has said 30 days will be given to over 1,000 home buyers who have opted for a refund from the builder, Unitech Group, to reconsider the decision and take possession of their flats.
The Enforcement Directorate (ED) in its report, filed in a sealed cover before the top court had said that it has attached properties worth Rs 650 crore of Unitech Group in connection with the money laundering charges against it and others, out of which Rs 450 crore is recoverable.
On January 20 last year, in a respite to over 15,000 hassled home buyers of Unitech, the top court had allowed the Centre to take total management control of the realty firm and appoint a new board of nominee directors.
The apex court had approved the name of retired Haryana cadre IAS officer Yudvir Singh Malik as chairman and managing director (CMD) of the new board and directed that the existing board of directors of the company would stand superseded.
In 2018, the top court had directed a forensic audit of Unitech Ltd and its sister concerns and subsidiaries by Samir Paranjpe, Partner, Forensic and Investigation Services in Grant Thornton India.
The forensic auditors had submitted their report which said that Unitech Ltd received around Rs 14,270 crore from 29,800 home buyers from 2006-2014 and around Rs 1,805 crore from six financial institutions for the construction of 74 projects.
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