Supreme Court on Amrapali: Pay or be ready for jail

NEW DELHI: Tightening the noose on all those who benefitted from Amrapali’s diversion of homebuyers’ money, the Supreme Court on Monday said it will deal with them “one by one and send each one of them behind bars” if they failed to deposit the money in the court.

The court also asked public sector Metal Scrap Trade Corporation Ltd to auction all properties of the Amrapali Group, which were attached by its order, to raise money for speedy construction of its stalled housing projects by National Buildings Construction Corporation.

Irked by non-compliance with its July order directing all beneficiaries to deposit the amount within a month, a bench of Justices Arun Mishra and U U Lalit said it will have no option but to haul them up for contempt of court and put them behind bars. It had in its judgment noted the names of companies and individuals who were beneficiaries of diversion of funds by Amrapali Group.

The apex court had come to the finding that homebuyers’ money was diverted to the tune of Rs 5,619.47 crore to the other companies through (i) payment of professional fee to directors for Rs 100.53 crore; (ii) bogus billing for Rs 842.42 crore; (iii) under-valuing of flats to the tune of Rs 321.21 crore; (iv) brokerage against flats which were not sold by the company and (v) inter-corporate deposits given to related entities.

Noting that many of the beneficiaries had not refunded the amount, the court said, “We will deal with each of them one by one and send everyone behind bars. Do not make mockery of judicial proceedings. Let the money be deposited first.”

It directed Sureka Group, which owns Jotindra Steel and Tubes Ltd, to deposit Rs 167 crore within six weeks in the SC registry and turned down its plea that it should be given an opportunity to convince the court that the amount was not part of homebuyers’ money. The court made it clear that it had passed the order after holding extensive hearings and it could not open a pandora’s box by reopening the case. It also turned down the plea of family of Amrapali’s directors who submitted that they invested Rs 13 crore in mutual funds out of their savings and it was not part of Amrapali’s funds.

“We want you to deposit the amount. We can hold you for contempt. We will simply call your clients and sent them to jail from here and they will remain in there till compliance with our order. First deposit the amount to be entitled to be heard,” the bench warned.

As Amrapali Group had allegedly diverted homebuyers’ money to get lease of government land in Bhubneswar and Raipur for building residential premises, the court also directed the Odisha State Housing Board to refund Rs 34 crore and New Raipur Development Authority to refund Rs 19 crore and deposit the amount in the SC registry. It also directed them to invite bidding for auction of the land which was earlier given to Amrapali Group.

As per the report of NBCC which was given the task by to take over as project management consultant to complete construction of 46,575 flats in 19 projects in Noida and Greater Noida, the construction cost to complete the housing projects of the Group will be around Rs 8,500 crore.