The Supreme Court Tuesday cancelled the registration of Amrapali Group under the Real Estate Regulatory Authority (RERA), as well as the lease granted to it by Noida and Greater Noida authorities for its properties. The bench, comprising Justices Arun Mishra and U U Lalit, said there was “gross violation” by the company as it found that it had diverted homebuyers’ money in violation of Foreign Exchange Management Act (FEMA) and foreign direct investment (FDI) norms.
Explained: What is the case against Amrapali Group?
The Amrapali Group has been accused of raising funds from investors for housing projects, but failing to complete and deliver the same. Homebuyers had moved the Supreme Court in 2017 seeking possession of their homes and compensation for the delay in delivery. The company is accused of leveraging at least Rs 2,765 crore of investors’ funds with the promise of delivering 46,000 flats at 28 properties in the national capital region (NCR) and other cities.
The modus operandi of the company was to reportedly use the inflow of cash from buyers to acquire more land and expand their business, instead of completing projects at hand.
Amrapali case: What next for homebuyers?
In a relief for homebuyers, the SC has handed over all pending projects of the group to the National Buildings Construction Corporation (NBCC). It has also directed authorities in Noida and Greater Noida to handover a completion certificate to those who are residing in various projects of the group.
What will happen to Amrapali officials?
The Amrapali Group was founded by Anil Sharma, who delivered the company’s first project for 140 flats in 2003. Sharma grew to become one of India’s leading real estate players after he capitalised on the real estate boom and expansion of the NCR after the turn of the century. The Enforcement Directorate (ED) will now probe top officials of the company, including Sharma, for money laundering.
Earlier this year, the Delhi Police charged Sharma and two other directors of the company under IPC sections 406 (punishment for criminal breach of trust), 420 (cheating and dishonestly inducing delivery of property) and 120B (punishment of criminal conspiracy).
Not just real estate, Amrapali invested in hotel chains, FMCG products (Amrapali Mums), the entertainment industry (Amrapali Media Vision) etc. Sharma also unsuccessfully contested the 2014 Lok Sabha elections from Bihar on a JD(S) ticket.
Amrapali Group: The Dhoni connection
Cricketer Mahendra Singh Dhoni is among the troubled creditors who had paid Amrapali in advance for a 5,500-square feet penthouse in Amrapali Sapphire in Ranchi, but was never given possession of it. Further, Dhoni has also alleged that he has not been paid Rs 40 crore for endorsing the company between 2009 and 2016.
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