Unitech, Sun Media violates terms and conditions, wanted to sell JV assets
Mired in controversies over land allotment process and implementation delays, the decade long yet to be implemented Recreation Park project in Gurgaon’s Udyog Vihar has kicked up yet another storm. Hitender Rao reports.india Updated: Jan 05, 2012 20:16 IST
Mired in controversies over land allotment process and implementation delays, the decade long yet to be implemented Recreation Park project in Gurgaon’s Udyog Vihar has kicked up yet another storm.
In clear violation of terms and conditions of allotment of land, the promoter of the project -- M/s Gurgaon Recreation Park Limited (GRPL) signed a memorandum of understanding with a private entity M/s Arpit Projects Ltd (on April 27, 2009) for transfer of hotel block of the project and also accepted Rs 20 crore as part consideration without the approval of Haryana State Industrial and Infrastructure Corporation (HSIIDC), the joint venture partner in the project.
The HSIIDC on December 16, 2011 served a show cause notice to the collaborators in the project – M/s Unitech Limited and M/s Sun Media Pvt Ltd and GRPL, the special purpose vehicle (SPV) incorporated by the collaborators for implementing the project, asking them as to why the assisted sector agreement be not terminated and the plot allotted by HSIIDC not resumed forthwith in view of the violations of terms and conditions.
Haryana officials who did not want to be quoted said they came to know of the move to transfer the hotel block to a private entity after a dispute arose between the two parties. The promoter was earlier forced to stall construction activity after the bank had discontinued disbursement of loan. In June 2009, the collaborators had sought HSIIDC's permission to allow it to sell the hotel block so that the money earned could be used for completion of project. The permission however was denied by HSIIDC.
"It has been noticed that GRPL and collaborators – Unitech and Sun Media have violated term and conditions of the assisted sector agreement of 2004, the supplementary agreement of 2006, land transfer agreement of 2004 and deed of conveyance of 2007 executed in favour of GRPL," said the show cause notice.
Top officials said that despite repeated requests by the Corporation, the sweat equity equal to 15 % of the paid up capital (including loans from collaborators) either through initial public offer (IPO) or otherwise has not been issued in Corporation's favour by GRPL. "It is a violation of provisions of supplementary assisted sector agreement inked in 2006," the notice said.
Moreover, the project was not fully implemented within the stipulated period (upto August 31, 2010). "For considering further extension of one year (till August 31, 2011), the company was advised by HSIIDC to pay an extension fee of Rs 24.50 lakh but it failed to pay up. The company has thus also violated the land transfer agreement of 2004."
"On our part we have also engaged a consultant to realize the sweat equity as it was felt that an initial public offer will not be a feasible option for a such a small project," said a top official.
First Published: Jan 05, 2012 20:08 IST