Logix Infratech Private Ltd, a real estate firm based in Noida, has come under scrutiny for the alleged fraudulent allotment of 261 flats in one of its apartment complexes to the brother of Bahujan Samaj Party (BSP) supremo and former Uttar Pradesh Chief Minister, Mayawati, and his wife. Official records investigated by The Indian Express (link behind paywall) have revealed a series of alleged irregularities involving deception, undervaluation, and misrepresentation.
The sequence of events over a period of 12 years, from the company's incorporation to its bankruptcy proceedings and subsequent forensics audit in May 2023, suggests a pattern of alleged irregularities, according to the report.
Here are the key findings reported by IE:
In May 2010, Logix Infratech Private Ltd was incorporated. Mayawati was then at the helm of Uttar Pradesh politics and had been serving as the chief minister since May 2007.
Two months later Logix entered into agreements with Mayawati's brother, Anand Kumar, and his wife, Vichiter Lata, to sell each approximately two lakh sq feet of space in their Noida project, Blossom Greens. The purchase price for Anand Kumar was ₹46.02 crore, and for Vichiter Lata, it was ₹46.93 crore.
In September 2010, the Noida Authority, under the Mayawati-led Uttar Pradesh government, leased 1,00,112.19 sq meters, or 24.74 acres, of land to Logix Infratech for the development of 22 towers in Blossom Greens.
{{/usCountry}}In September 2010, the Noida Authority, under the Mayawati-led Uttar Pradesh government, leased 1,00,112.19 sq meters, or 24.74 acres, of land to Logix Infratech for the development of 22 towers in Blossom Greens.
{{/usCountry}}From September 2010 to 2022-23, Logix sold a total of 2,329 units out of the 2,538 residential units in Blossom Greens. While possession of eight towers comprising 944 flats has been offered, only 848 buyers have taken possession. The remaining 14 towers are not yet ready for possession, despite the completion of their civil structures.
On April 4, 2016, Anand Kumar was allotted 135 apartments, while Vichiter Lata received the remaining 126 apartments. They paid an 'advance' of ₹28.24 crore and ₹28.19 crore, respectively.
On February 15, 2020, Logix Infratech received the first notice demanding unpaid dues of Rs. 7.72 crore from the construction company Ahluwalia Contracts (India) Ltd, to whom they had awarded civil and structural works for Blossom Greens worth ₹259.80 crore.
In October 2020, Logix responded to the notice, citing reasons such as Covid-19, which led to a ban on construction in the National Capital Region (NCR) towards the end of 2019, and a shortage of skilled labor as the primary factors leading to their inability to pay the dues to Ahluwalia Contracts.
On September 29, 2022, the National Company Law Tribunal (NCLT) ordered bankruptcy proceedings against Logix, initiating the Corporate Insolvency Resolution Process (CIRP) to recover the money owed by the company.
As per the insolvency norms, the NCLT appointed an Interim Resolution Professional (IRP) who ordered an audit of Logix's books. The Transaction Audit Report submitted to the IRP in May 2023, which The Indian Express said it has reviewed, highlights that the units sold to Anand Kumar and Vichiter Lata were undervalued, and the transactions were deemed fraudulent.
Anand Kumar was billed at ₹2,300 per square foot, significantly lower than the average net rate at which units were transferred to other home buyers in the fiscal year 2016-17, which was ₹4,350.85 per square foot. The report states that these undervalued transactions violate Section 45 of the Insolvency and Bankruptcy Act 2016.
Additionally, 36 units allotted to Anand Kumar were already in the possession of other parties, indicating possible misrepresentation or deception in the allotment process, according to the audit report.
(source: The Indian Express)