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EMAAR-MGF dispute: Sham valuation of 54 acres within 72 hours paved way for defrauding India partner, says FIR
The UAE based realty firm has been booked for cheating, forgery, criminal breach of trust, criminal intimidation and criminal conspiracy on the orders of the Gurugram chief judicial magistrate on the basis of a complaint submitted by its former India partner, MGF Development Ltd
An independent valuer appointed by United Arab Emirates (UAE) based multinational real estate development company, Emaar Properties PJSC allegedly visited, verified and valued about 54 acres of unevenly distributed land in six Gurugram sectors within three days of its appointment, said a first information report (FIR) registered by Gurugram police against the developer on the orders of a court.
“This leaves no doubt that there was a prior meeting of minds to defraud the complainant (MGF). A bare perusal of the valuation report will show that the value of the land parcels mentioned therein has been deliberately undervalued and depicted as having lesser value compared to the land lying in the adjoining areas,’’ the November 20 FIR said.
The UAE based realty firm has been booked for cheating, forgery, criminal breach of trust, criminal intimidation and criminal conspiracy on the orders of the Gurugram chief judicial magistrate on the basis of a complaint submitted by its former India partner, MGF Development Ltd.
‘Two agencies found no criminality in MGFs allegations’
A statement by Emaar India on Friday however said that MGF had approached the authorities twice – the economic offences wing in Gurgaon and Delhi - and both the agencies found no criminality or merit in the allegations of MGF. “While the matter is sub judice, this appears to be nothing but another attempt by MGF to further harass Emaar and its employees,” said the Emaar India statement.
The FIR said that shockingly within 72 hours of its appointment, the valuer issued a valuation report for land chunks in Gurugram’s Sector 81 (4.75 acres), Sector 85 (9.01 acres), Sector 99 (8.61 acres), Sector 74-A (14.54 acres), Sector 73 (7.49 acres), Sector 63, (10.40 acres). “Not only is the so-called valuation report a complete sham and contrary to all principles pertaining to the valuation of land and immovable property, it is equally absurd and unbelievable that valuer has physically visited, verified and valued over 50 acres of unevenly distributed land within three days of its appointment. This leaves no doubt that there was obviously a prior meeting of minds to defraud the complainant,” the FIR said.
It further said that a bare perusal of the valuation report will show that the value of the land parcels mentioned therein has been deliberately undervalued and depicted as having lesser value compared to the land in the adjacent areas.
‘Valuation was for internal assessment but used for taking over assets’
The FIR said that while it has been mentioned that the purpose of preparation of valuation report is for the internal assessment purpose of Emaar but the report has been used to illegally and fraudulently usurp the properties of the MGF by showing the value of category B demerged assets to be of lesser value or same value as compared to the alleged claims raised by Emaar. “It is clear that by purposely decreasing the value of the land and inflating their own claims, Emaar has unlawfully enriched itself at the expense of the complainant and caused it wrongful loss. The MGF in its complaint has accused its former business partner of usurping its assets by inflating their claim amount and undervaluing the assets kept in the security basket of indemnity agreement.
“Emaar issued multiple letters to the complainant (MGF) for usurping the properties of the complainant firstly by inflating their claim amounts and then secondly by undervaluing the assets kept under security basket of the indemnity agreement (category B demerged assets) with the assistance of falsely prepared documents - forged valuation reports of independent valuer,’’ the FIR said.
It said that Emaar illegally usurped MGFs land in Sector 74-A -Begampur Khatola (8.85 acres), Sector 81 - Nakhdola (0.92 acres), Sector 85 –Badha (9.01 acres) and Sector 99 -Kherki Majra (8.62 acres).
FIR shows comparison of land sale in same sectors
The FIR said a comparison of land value arrived at by Emaar with contemporaneous registered sale deeds executed in the neighbouring areas by unconnected third parties shows the alleged fraud perpetrated on MGF. Quoting examples, the complainant said the properties close to their land have been sold at four times worth than the valuation done by Emaar appointed valuer. The FIR said while Emaar allegedly usurped 3.84 acre in Gurugram’s Sector 81 (village Nakhdola) from MGF for ₹4.18 crore per acre on May 26, 2020, seven months later on December 24, 2020, the realty firm executed a collaboration agreement for a land parcel in the same sector with Global Heights (Breez Group) at a higher value of ₹6.75 crore per acre. Similarly, Emaar allegedly usurped 9.01 acres in Sector 85 (village Badha) for ₹4.56 crore per acre on September 17, 2019, while it executed a collaboration agreement on Nov 5, 2020, in Sector 85 with Conmin Projects India Private Limited (Pyramid Infratech) at a value of ₹6.25 crore per acre in the same sector, the FIR said.
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“We strongly deny any association of criminality with this issue. As a responsible corporate entity, Emaar group has been acting in accordance with the law and will continue to uphold the highest ethical standards of business conduct.” -Emaar India.
