Supreme Court Makes It Clear That Those Who Diverted Amrapali Group Funds Will Either Pay Or End Up In Jail

The Supreme Court has stated that it intends to tighten the noose on all of those in the Amrapali Group who benefited from the diversion of homebuyers’ money.

The court stated that it would have no other option but to charge those responsible for diversion of homebuyers’ funds from the Amrapali Group with contempt of court and throw them behind bars.

The court stated that it would deal with them “one by one and send each one of them behind bars” if they failed to deposit the money in court.

It may be recalled that in its order in July, the Supreme Court had directed all beneficiaries of diversion of funds by the Amrapali Group to deposit the amount within a month.

The court has come to the finding that homebuyers’ money was diverted to the tune of Rs 5,619.47 crore to the other companies through various methods.

Such transactions included payment of professional fee to directors for Rs 100.53 crore, bogus billing for Rs 842.42 crore as well as undervaluation of flats to the tune of Rs 321.21 crore.

Other methods used were brokerage against flats which were not sold by the company as well as inter-corporate deposits given to related entities.

The court directed the Sureka Group, which owns Jotindra Steel and Tubes Ltd, to deposit Rs 167 crore within six weeks with the SC registry and turned down its plea that it should be given an opportunity to convince the court that the amount was not part of homebuyers’ money.

The court made it clear that it had passed the order after holding extensive hearings and it could not open a pandora’s box by reopening the case. It also turned down the plea of family of Amrapali’s directors who submitted that they invested Rs 13 crore in mutual funds out of their savings and it was not part of Amrapali’s funds.

The court directed the Odisha State Housing Board to refund Rs 34 crore and the New Raipur Development Authority to refund Rs 19 crore and deposit the amount with the SC registry.

It directed them to invite bidding for auction of the land which was earlier given to Amrapali Group.

Allegedly, the Amrapali Group had diverted homebuyers’ money to get lease of government land in Bhubaneswar and Raipur to construct residential premises, but diverted the funds.