Unitech takeover: Regional RoC probe found irregularities

CHANDIGARH: It was the year-long investigation into the transactions of the Gurugram-based real estate giant, Unitech Ltd, conducted by the registrar of companies (RoC), Chandigarh chapter which has under it the jurisdiction of Punjab, Chandigarh and Himachal Pradesh, Raj Singh, which found several irregularities in the working of Unitech.

The probe was conducted by Singh at the behest of Union ministry of corporate affairs (MCA) which subsequently moved the national company law tribunal (NCLT), New Delhi, that ordered the suspension of directors of Unitech Ltd on Friday, so as to address complaints of hundreds of plot/flats buyers.

The probe which made the basis for MCA plea before NCLT, pointed out several incidence of gross mismanagement by the company directors because of which, it strongly recommended the company’s takeover as it was functioning in a manner prejudicial to the public interest.

It said that an amount of ₹694 crore given to various parties as advance for purchase of land was outstanding since years and company had neither got the land nor the amount recovered. It also had debtors owing ₹400 crore and there was no sign of recovery.

Even the company employees had not got their salaries since years and their dues were ₹115 crore as on March 31, 2016. The probe also pointed out that the imprudent decisions had also cost the company a loss of ₹944 crore because of the cancellation of land allotment in Greater Noida.

The investigation report further said there are over 13,000 home buyers awaiting delivery and 51,000 fixed deposit holders awaiting repayment of their matured FD amounting to ₹723 crore.

The company has taken loans from banks and financial institutions amount to ₹3,600 crore and it was at stake if the company was not saved from the continuing mismanagement.

The report repeatedly recommended appointment government directors as it would create hope in the mind of all the stakeholders including employees and be able to resolve all the issues in the interest of the stakeholders.

YEARLONG PROBE INTO THE TRANSACTIONS CONDUCTED BY REGISTRAR OF COMPANIES AT THE BEHEST OF UNION MINISTRY OF CORPORATE AFFAIRS