The Delhi High Court on Monday reserved its verdict on real estate major Emaar-MGF's plea against the Centre's order asking DDA to seize the firm's entire bank guarantee worth Rs 183 crore as damages for its failure to complete the Commonwealth Games village project in time.
Justice Vipin Sanghi reserved the order after hearing the arguments from the counsel of both Emaar MGF and DDA.
Additional Solicitor General (ASG) Indira Jai Singh argued that the DDA was entitled to encashing the entire bank guarantees of Rs 183 crore (Rs 150 crore of SBI and Rs 33 crore of State Bank of Patiala) furnished by the company as it has failed to meet the March 31, 2010, deadline to complete the project.
"Till today, the company has not completed the work, including the exterior part of some towers, including milestones 8 and 9 (towers have been rechristened as milestones)", she said.
She argued the company has not obtained the completion certificate till date from the monitoring committee which certifies the building is technically fit for occupation.
The counsel for Emaar-MGF contended that the the DDA's act of encashing entire bank guarantee worth Rs 183 crore was illegal.
The DDA had issued a notice to the firm to deposit only Rs 83.70 crore as damages and seven days time was given to deposit the money but seizing the whole bank guarantees showed the housing body was involved in fraud, the counsel said.
Acting tough, the Urban Development Ministry had ordered initiation of legal actions against Emaar-MGF for recovery of other expenditure for "deficiencies" and "delays" in construction of the Games Village.
The ministry's direction to the DDA had come a day after the civic authority submitted an interim report in which it said "immediate action" was required to be taken against the builder for "non-execution of the project as per the agreement".