On Tuesday 7 July 2020, the Supreme Court granted interim bail to Unitech Ltd. promoter Sanjay Chandra. The Court was told that his 78-year old father has been infected with COVID-19 and had been hospitalized in the Intensive Care Unit (ICU).
Sanjay, along with his younger brother Ajay Chandra, was sentenced to imprisonment in 2017 for allegedly siphoning off more than Rs 5,000 crore, deposited by homebuyers into his real estate firm. A division bench of Justices D Y Chandrachud and M R Shah granted the interim bail for one month to Sanjay, though Ajay Chandra was denied the same.
Background of the Case-
Unitech failed to complete its housing projects in Gurugram and Greater Noida and did not refund the homebuyer’s money with interest incurred thereon. It had promised to deliver possession of the flats in 2012. In 2015, a criminal complaint was filed against the Chandra brothers. Later on, 173 home buyers of Unitech projects− ‘Wild Flower Country’ and ‘Anthea Project’ in Gurugram− joined the complainant and filed similar complainants. In 2018, the Supreme Court ordered a forensic audit of Unitech Ltd. and its sister companies and other subsidiaries. It was carried out by, a Forensic and Investigation Services partner in M/S Grant Thornton India, Sameer Paranjpe. The reports were then submitted by the financial auditors that stated that Unitech Ltd. received about Rs 14,270 crore from 29,800 homebuyers, mostly between 2006 and 2014. In addition to this, it received about Rs 1,805 crore from 6 financial institutions for the construction of 74 projects. The audit reports revealed that out of Rs 14,270 crore of homebuyers’ money, about Rs 5,063 crore, and around Rs. 763 crores of funds received from financial institutions, were not utilized by the company and high-value investments in off-shore tax haven countries were made between 2007- 2010. The promoters were also engaged in other unscrupulous activities pertaining to money laundering and financial fraud. Subsequently, the two managing directors, Sanjay Chandra and Ajay Chandra were arrested in April 2017 for offenses pertaining to cheating, fraud, and siphoning off client’s money to foreign accounts. Recent Developments-
In January 2019, the Supreme Court had denied bail to both the brothers, citing their non-compliance with an SC order dated 30 October 2017, which directed them to deposit a sum of Rs 750 crore with the court’s registry by 31 December 2017. On 20 January 2020, the apex Court, granting relief to around 12,000 home buyers of Unitech Ltd., authorized the Centre to take over the management of the real estate firm, and thereafter, appoint a new Board of nominee directors. The bench gave two months to the new Board to submit a report on a resolution framework. The preparation of the said framework will be monitored by a former judge of SC, it added. Complying with the top Court’s order, the central government appointed retired IAS officer Yudvir Singh Malik from Haryana cadre as the chairman and managing director (CMD) of the new Board and directed that the existing Board of Directors remain superseded.