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Enforcement Directorate to examine alleged Rs 1,600 crore siphoning by Unitech promoters

After the SC appointed auditor Grant Thornton highlighted grave irregularities in its preliminary report, the forex enforcement agency has zeroed in on this case.

, ET Bureau|
Jul 15, 2019, 07.46 AM IST
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In December 2018, the Supreme Court ordered forensic audit of the Unitech group.
NEW DELHI: An alleged siphoning of over Rs 1,600 crore by real estate developer Unitech’s promoters has come under the scanner of the Enforcement Directorate (ED).

The agency will examine whether the funds were siphoned off abroad. It will zero in on bank accounts of the directors of the company to ascertain if the money was diverted to foreign shores including Dubai. ED will also check the money laundering angle under the Prevention of Money Laundering Act (PMLA).

After the Supreme Court appointed auditor Grant Thornton highlighted grave irregularities in its preliminary report, the forex enforcement agency has zeroed in on this case.

In May this year, in its preliminary report, the auditor said Unitech diverted over Rs 1,500 crore of homebuyers money for purposes other than construction of housing projects. Thornton’s report said over Rs 1,500 crore was spent by the group to acquire land and for other purposes. It also said advance of Rs 600 crore given to a few individuals in 2012 had not come back to the company. Highly placed ED sources told ET the amount under the scanner is nearly Rs 1,600 crore that is suspected to have been siphoned off.

Sanjay Chandra, the managing director (MD) of Unitech, and his brother Ajay Chandra, another MD, were arrested in April 2017 after flat owners who had paid in full for their flats did not get their houses on time in Gurugram’s Sector 70.

The Chandra duo is accused of not obtaining valid permissions from competent authorities before commencing the project. Also, the two allegedly did not return money to the buyers who sought refund of their amount for delay in handing over possession of the housing project.

The two have nearly 100 complaints registered against them for alleged fraud and cheating to the tune of Rs 35 crore. Over two dozen home buyers of Unitech’s housing projects in Noida and Gurugram had approached the National Consumer Disputes Redressal Commission (NDRC) after the builder had failed to given them possession of their flats as per schedule. The company had promised to hand over the possession of flats in 2012 but failed to meet the deadline.

In December 2018, the Supreme Court ordered forensic audit of the Unitech group and its subsidiary companies to probe alleged financial irregularities and diversion of homebuyers’ money by its promoters and directors. The apex court asked Grant Thornton to peruse documents and bank accounts of all group companies of Unitech, their promoters and directors from 2006 onwards.

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