Centre withdraws its petition to take over Unitech management

The government today informed the Supreme Court that it will withdraw the petition filed before the National Company Law Tribunal (NCLT) to take over the management of the embattled real estate company Unitech Ltd, Moneycontrol reported citing sources.

Legal experts said the move is reassuring for homebuyers. ''Now the Supreme Court will handle the matter independently and will not give any indulgence to the embattled firm until it deposits a substantial amount with the court registry,'' said Supreme Court advocate M L Lahoty, who is representing Unitech homebuyers.

The SC had earlier stayed the 8 December order of the NCLT allowing the Centre to take over the management of the company.

NCLT had on 8 December suspended all the eight directors of the realty firm over allegations of mismanagement and siphoning off of funds, and had authorised the Centre to appoint its 10 nominees on the board.

In its petition filed under section 241 of the Companies Act, 2013, the government had requested the tribunal to remove the eight directors and said the company has over Rs6,000 crore debt and over 16,000 undelivered units from a total of nearly 70 projects.

The NCLT, in its order, had also said the government must give the names of its nominees by 20 December and restrained Unitech's eight suspended directors from selling their personal and company properties.

On 12 December Supreme Court expressed serious apprehension about the manner in which the Centre moved the National Company Law Tribunal (NCLT) to take control of embattled real estate firm's board without seeking its permission.

Attorney General K K Venugopal had conceded that ''this should not happened. The government should not have approached NCLT when Supreme Court was seized of the matter relating to Unitech's failure to refund homebuyers.''

The stay of NCLT's order on 9 December meant that Unitech's promoter Sanjay Chandra, who is currently in jail, could resume negotiations from prison for sale of assets to generate Rs750 crore that he had been asked to deposit in court by December-end.

The apex court had on 30 October said Chandra will be granted bail only after the real estate group deposited money with its registry by December end. The top court had earlier directed the jail authorities to facilitate Chandra's meeting with his company officials and lawyers so that he could arrange money to refund the home buyers as well as for completing the ongoing housing projects.

The SC on Monday ordered the firm, which is negotiating with Unitech for purchasing land in Chennai valued at around Rs400 crore to deposit the money before it to show its bona fides in acquiring the property on 16 February, the next date of hearing.

Unitech told a bench headed by Chief Justice Dipak Misra that it was negotiating with a company to sell two portions of it land in Chennai for around Rs170 crore and Rs229.45 crore respectively.

The bench, also comprising Justices A M Khanwilkar and D Y Chandrachud, directed the top court registry to issue notice to the company which is negotiating with Unitech in acquiring the land, asking its competent authority to appear before it on 16 February.

"If the company is desirous of purchasing the property at the value indicated (by Unitech), it can bring a draft of the said amount in the name of the Registrar of the SC so that further directions can be issued," it said.

The apex court did not comment on the request of Unitech managing director Chandra to grant him custody parole for eight weeks to enable him to arrange money to refund homebuyers and complete the ongoing housing projects.