Supreme Court puts NCLT's Unitech takeover order on hold
The Supreme Court today stayed the National Company Law Tribunal's order which directed the government to takeover real estate Unitech management. This comes a day after the apex court called the tribunal's order 'disturbing'.
On Tuesday, the top court slammed the NCLT for allowing the central government to form 10-member nominee board to initiate the takeover process at a time when the SC is hearing the case. "We are hearing this matter how can NCLT pass orders. It is disturbing," the court said.
It further said that the government should have sought its permission before approaching the tribunal. The top court asked the government to come up with suggestions on protecting interests of home buyers' who had invested their money with the debt-ridden realtor.
Last week on Friday, the NCLT suspended all the eight directors of Unitech. The move came after the Corporate Affairs Ministry approached the tribunal against the real estate over mismanagement and its failure to complete construction projects on time.
The government also asked the bankruptcy court to suspend the company's board of directors and its chief financial officer under the Companies Act, 2013. The NCLT invoked the provisions of the Companies Act and allowed the government to take over the company.
Unitech approached to the apex court, saying that its bank accounts have been frozen and the company is finding it difficult to deposit Rs 750 crore as asked by the Supreme Court. Unitech counsel and senior advocate Ranjit Kumar said that the entire firm has been taken over by the government and its appeal be heard on an urgent basis. The court had recently asked the real estate firm to deposit Rs 750 crore with it by December end to safeguard the interests of homebuyers.
With a total debt of over Rs 6,000 crore, the company has not been able to deliver over 16,000 units from its 70 housing projects spread in different parts of the country. Unitech owes over Rs 723 crore to its 20,000 home buyers and 51,000 depositors.