Government to Withdraw Plea to Take Over Unitech

The government’s statement came after Unitech announced the sale of land worth Rs 400 crore to repay homebuyers.

Proposed elevation plan of Unitech’s project Burgundy in Sector 96, Noida. Image for representation. 

(Photo Courtesy: Unitech Website)

The government informed the Supreme Court that it will withdraw its plea in the National Company Law Tribunal to take over Unitech Limited, on Tuesday, 30 January, after the real estate company finalised a deal for raising funds to repay homebuyers.

A three-judge bench headed by Chief Justice of India Dipka Misra disposed of the case after the government lawyer Rajat Nair submitted the plea.

Unitech finalised a deal to sell land worth Rs 400 crore on Monday, 29 January. The apex court on 30 October 2017 had directed the company to deposit Rs 750 crore by December to secure bail for its director Sanjay Chandra, who is in jail in a case of forgery filed by buyers of Unitech’s incomplete housing project in Gurugram. 

The real estate firm had told the court that it would monetise its unencumbered properties and assets to recover money that would be used to refund buyers and complete projects.

The government had filed a petition arguing that Unitech was a fit case for winding up, but considering the interest of thousands of homebuyers and small depositors, it wanted to take over the company’s management. The Supreme Court had ruled against that plea.

Shares of Unitech parred losses and rose as much as 5.6 percent to Rs 9.45 apiece after the government’s decision to withdraw its plea. The stock has returned 7.3 percent since the beginning of the year.

(This story was first published on BloombergQuint)