'Disturbing': Supreme Court Raps Tribunal Over Unitech Order

The Supreme Court today rapped the NCLT or National Company Law Tribunal for passing an order in the Unitech case at a time when the top court is hearing the case. The Centre has been asked to give its suggestions to the court by tomorrow on how to protect the interest of those who have bought homes from Unitech. The real estate developer had moved the Supreme Court on Monday against the tribunal's order allowing the government to take over the company.

"When we are hearing this matter how can NCLT pass orders. It is disturbing," the top court said today. Senior advocate Mukul Rohatgi, appearing for Unitech, told the court that the real estate developer was not given an opportunity by the tribunal. 

The tribunal had on Friday suspended all the eight directors of the realty firm over allegations of mismanagement and siphoning of funds, while authorising the government to appoint its 10 nominees on the board.

In a rare move, the government had approached the tribunal to take over the management to protect the interest of nearly 20,000 home buyers, and 51,000 depositors to whom the company owes Rs 723 crore. The government's intervention in this case comes almost a decade after it had taken over the board of IT firm Satyam (now Tech Mahindra) and sold it to the Mahindras.

The NCLT said the government must name its nominees by the next date of hearing, December 20, while restraining Unitech's eight suspended directors from selling their personal and company properties. The tribunal's order came after the government filed a petition arguing that Unitech was a fit case for winding up but considering the interest of thousands of home buyers and small depositors, it wanted to take over the company management.

Unitech had challenged the tribunal's order saying that "no coercive steps for execution" can be taken in view of a November 20 order of the Supreme Court.

The Supreme Court had recently asked Unitech to deposit Rs 750 crore by December-end in bail pleas of Sanjay Chandra and Ajay Chandra, who were arrested by the Economic Offence Wing (EOW) of the Delhi Police in April for allegedly not developing a project despite receiving funds from home buyers. The Chandra brothers had moved the top court after the Delhi High Court refused to grant interim bail to them.