Supreme Court asks Amrapali to explain ‘diversion’ of ₹2,766 crore

Company asked to file its statement of accounts in five days.

The Supreme Court on Wednesday asked the troubled real estate developer Amrapali group to share details of ₹2,766 crore it had allegedly diverted to its other companies, as it sought to reassure homebuyers that their money was safe.

Homebuyers in Amrapali projects in Noida and company representatives inspect work at a project in March 2018.

A bench headed by justice Arun Mishra asked the company to file its statement of accounts in five days and told its lawyer that the “jigsaw puzzle” created by the firm would have to be solved to protect the interests of the homebuyers.

“You have to tell us each and every single instance where the money was diverted from the company to other projects... Whether it is lending, loan or payment, we want each and every thing,” the judges told the firm’s advocate Gaurav Bhatia.

Details were sought after the petitioners pointed out to the expenses column in the affidavit filed by Amrapali on the court’s direction.

Senior advocate Ajit Sinha alleged that the company had diverted money. The money was with group companies and not diverted, Bhatia said.

The court asked the company to provide the dates of every transaction and specify if the money was lent before the enactment of Real Estate (Regulation and Development) Act, 2016.

The landmark realty law that came into force a year ago is meant to protect homebuyers from unscrupulous developers and prevent diversion of funds, among others.

Initially, the court asked for Amrapali’s audit report but later directed the company to file a statement of accounts.

The court said the problem was that the company had failed to meet project deadlines. “It is up to you to put your house in order. How will you do it, we don’t know. A businessman should stand by his words,” justice Mishra said.

Lawyers for homebuyers who bought flats in Amrapali’s Heartbeat City in Noida claimed the directors had abandoned the project and only 20% work was complete.

The bench asked Amrapali to explain under which provisions the money was diverted. The court also directed the Noida authority to conduct an inspection of fire safety measures, power back-up and other amenities in Amrapali buildings where residents had moved in.

The case will now be heard on May 15.