Besides these, the board also proposed to utilise funds deposited with the apex court’s registry by former Unitech promoter Sanjay Chandra and others and also sought a direction to the homebuyers to pay the balance receivables.
By Indu Bhan & Rishi Kala
To protect the interests of thousands of homebuyers and depositors, the Supreme Court-appointed Unitech board has unanimously ruled out winding up of the embattled real estate developer and proposed completing its 86 stuck projects within four years.
Proposing a way forward, the board said that around Rs 5,000 crore would be required to complete the stalled projects of Unitech and a part of that would be raised through priority funding from the government-operated alternate investment fund (AIF), SWAMIH. It said that the flats will be delivered in phases within 4 years to more than 15,000 homebuyers.
It also wants the SC to direct banks to disburse balance loan to homebuyers and to work out long-term re-structuring of home buyers’ loans. “… incase the operations of Unitech were to be wound up on the date, the homebuyers, creditors and all the stakeholders would only be entitled to a miniscule percentage of their claim of 13-15% and that too … as and when the assets would be realised after sale,” the board said in its roadmap submitted to the apex court. “Since the company is already cash-strapped and does not have reserves, it is proposed that no refunds shall be made to home buyers and delivery of possession shall be the sole objective,” the affidavit stated, adding that it would include even cases stuck in litigation.
The SC is likely to hear the Unitech matter on July 23.
While the resolution plan pegged Unitech’s total liabilities at more than Rs 28,200 crore, its current realisable assets (at book value) are around Rs 3,700 crore, the board said.
While the roadmap envisaged the construction to start in the next six months, it said that the board will approach SWAMIH fund, which is managed by SBICAP Ventures, to raise part of Rs 5,000 crore required for completion of projects.
Besides these, the board also proposed to utilise funds deposited with the apex court’s registry by former Unitech promoter Sanjay Chandra and others and also sought a direction to the homebuyers to pay the balance receivables. It has also suggested to monetise unsold residential, commercial and plotted inventory as well as from recoveries to be made from persons to whom homebuyers funds had been diverted, as per report of the forensic auditor.
The board proposed that 55,184 fixed deposit holders be paid, to the extent of principal sum initially, from the final surplus after meeting the construction obligations. Interest shall be payable only if there are sufficient reserves after satisfaction of claim of all other stakeholders, it added.
It also urged the SC to direct that all arrangements between Unitech and asset reconstruction companies (ARCs) shall stand terminated and the ARCs hand over all contracts, agreements, bank accounts, monies and receivables related to the projects and non-project lands to the board.
The ARCs have a share in surplus and also have a charge on substantial project assets and large land bank of Unitech, the value of which far exceeds the amounts due. This results in blocking the assets of Unitech, which should be made available for utilisation.
On January 20, the SC had accepted the government’s proposal to take over the management control and had superseded its existing board and appointed a new board headed by Haryana cadre IAS officer Yudvir Singh Malik as its chairman and managing director. The SC had also asked the new board to prepare a resolution framework within two months and suggest a proposal to complete the pending projects.