Monday, 30th October 2017

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Custody to hotel stay for realty firm directors accused of fraud

Apex court says it wants cooperation, not lack of humanity

By Our Legal Correspondent in New Delhi
  • Published 12.10.18, 4:09 AM
  • Updated 12.10.18, 4:09 AM
  • 2 mins read
Amrapali group CMD Anil Kumar Sharma Agencies

The Supreme Court on Thursday ordered three directors of realty major Amrapali Group of Companies to be shifted to a hotel under police surveillance, overriding objections that they should remain in custody till they had submitted all documents in a case of alleged fraud on homebuyers.

“We want cooperation (from the directors), not lack of humanity,” Justice D.Y. Chandrachud told the lawyers who had appeared for some of those who had invested in the housing project.

The two-judge bench headed by Justice U.U. Lalit directed that Anil Kumar Sharma, Shiv Priya and Ajay Kumar be shifted from the custody of police in Noida, Uttar Pradesh, to Hotel Ascent in Noida.

The bench said the three would be under constant police surveillance but no longer in official police custody as the court had directed on October 9.

On Tuesday a bench headed by Justice Arun Misra had ordered the three directors to “remain in the custody of the police” till they handed over documents and account books to two court-appointed forensic auditors.

The realty group and its 46 companies are accused of not handing over to 46,000 homebuyers their promised flats from 2008 onwards and also diverting Rs 2,740 crore, including advances from the investors for the project spread across Delhi and Noida, Uttar Pradesh.

The police had taken the three directors into custody following the order.

On Thursday the bench ordered the three directors to cooperate with the authorities on handing over the documents, a process it said should be wrapped up in about 15 days.

The directors, the bench said, would be taken to the company’s offices every day at 8am and taken back to the hotel at 6pm under police escort.

Between 8am and 6pm, the court added, the directors and company staff would have to cooperate with the police.

The bench also said all the seven offices of the company in Noida would be under the lock and seal of Noida police.

The directions followed an application the three had moved pleading to be shifted to an alternative place from police custody and assuring the court of complete cooperation.

Advocates Mahalakshmi Pavani and M.L. Lahoty, who appeared for the homebuyers, urged the court not to modify the October 9 order.

They said any modification of the order of indefinite policy custody would make it difficult to get the documents as company officials had repeatedly defied the top court’s earlier orders.

Lahoty said that two days of police custody had helped the authorities access a substantial portion of the documents, which would not have been possible without the October 9 order.

But the court brushed aside their objections.

The bench of Justices Lalit and Chandrachud had assembled to pass Thursday’s directives as Justice Arun Misra, who was on the earlier bench with Justice Lalit, has not been attending the court since Wednesday. He is reportedly indisposed.

On October 9, the bench headed by Justice Misra had said: “All the documents to be handed over to forensic auditors by the police. In case the aforesaid persons fail to hand over the documents as ordered, they shall remain in the custody of the police till such time the documents are handed over. Let the police take them from the court along with them to their respective offices and residences and other places where documents may be found.”

The order had come on petitions some of the buyers had moved in the court last year.

When the matter had come up last month, the bench had asked the National Buildings Construction Corporation to complete the unfinished construction while giving the public sector company the authority to auction all the properties of the Amrapali group to recover the money.

It also asked the Amrapali group to hand over the documents to the forensic auditors, Pawan Kr. Aggarwal and Ravi Bhatia.