Govt mulls to take over management of Unitech

Government through the corporate affair ministry is seeking to take over the management of the beleaguered realtor Unitech, reported a leading news agency on Friday.

The company is facing proceedings in the Supreme Court with regards to the alleged fraud committed by delaying housing projects in Noida and Gurgaon. Several homebuyers had filed cases against Unitech for delaying possession of flat by slowing down construction due to a slump in sale. The petitioners sought compensation for delay in possession of their flats.

In February, the Supreme Court had asked the company to pay 14 per cent interest on Rs. 16.55 crore to 39 flat buyers who chose to withdraw from the project after the builder failed to deliver flats as per schedule. Sanjay Chandra, Unitech's Managing Director was arrested in April and the Supreme Court has denied him bail until the company deposits funds to protect the interests of homebuyers.

Unitech has around 19,000 home buyers awaiting for the possession of their houses and has also defaulted on payment of Rs. 600 crore to 15,000 small depositors.

Due to such irregularities, the government through the National Company Law Tribunal (NCLT) seeks to suspend Unitech’s board of directors and CFO, said the news report. The National Company Law Tribunal can under a section of the Companies Act, 2013 provide relief to the investors against wrongful actions committed by the company's management.

Meanwhile, the stock of  Unitech was trading at Rs. 6.73, up 10.69 per cent.