Accepting the government’s proposal to take over the management control of embattled realtor Unitech, the Supreme Court on Monday superseded its existing board and appointed a new board headed by Haryana-cadre IAS officer Yudvir Singh Malik as its chairman and managing director.
A bench headed by Justice DY Chandrachud gave two months to the new board of Unitech to prepare a resolution framework for the company and asked it to submit a comprehensive proposal for completion of the pending projects and delivery of flats to the homebuyers.
It also said that it would appoint a retired judge to monitor the preparation of the resolution framework by the new board. “There shall be a two-month moratorium on any fresh legal proceedings initiated against Unitech. Moratorium shall also extend to existing proceedings and on enforcement of orders passed against the company,” the bench said, adding that the current proceedings shall stand suspended to help the new board take charge.
The apex court also approved the names proposed by the government to the new board. AK Mittal, former CMD of National Buildings Construction Corporation; Renu Sud Karnad, chairman of HDFC Credila Financial Services; Jitu Virwani, the CMD of Bengaluru-based real estate firm Embassy Group; and Niranjan Hiranandani, the co-founder and MD of Mumbai-based Hiranandani Group, have been appointed as directors on the board.
Attorney General KK Venugopal told the Bench that the government was agreeable to revisit its 2017 proposal to take over the management control of Unitech and complete the projects so as to bring relief to around 30,000 hassled homebuyers. However, he said that the government would not infuse any funds for completion of pending projects of the company.
“That this court may issue directions to restrain the promoters from alienating, mortgaging, creating charge or lien or interest in the movable and immovable properties owned by them,” the government said, adding, services of the committee headed by Justice SN Dhingra, appointed to sell the company’s assets, be put on rest.
Venugopal also sought permission for the proposed board of directors to raise funds due from the homebuyers, sell the unsold inventory, monetise the unencumbered assets for completion of the stalled projects.
Audit firm Grant Thornton’s forensic report on the Unitech group and its subsidiary firms had accused the erstwhile board of siphoning off almost half of the homebuyers’ money. In an interim report, the audit firm had said that Unitech received around Rs 14,270 crore from 29,800 homebuyers mostly between 2006-2014 and around `1,805 crore from six financial institutions for the construction of 74 projects.