Hyderabad, January 01: In what seems to be a New Year resolution, the Andhra Pradesh Industrial and Infrastructure Corporation (APIIC) has decided to take its case against Emaar Properties to its logical conclusion. At its board meeting here on Thursday, APIIC decided to initiate criminal proceedings against the company for defrauding it of an estimated Rs 500 crore.
Emaar Housing & Township Private Ltd (EHTPL) is a special purpose vehicle floated by APIIC and Emaar Properties to co-develop a commercial and residential complex in Nanakramguda. Emaar was supposed to execute it along with the APIIC but it has roped in a co-developer — Emaar-MGF.
“As per legal advice, we have decided to press criminal charges against Emaar Properties,” B R Meena, (IAS), Vice-Chairman & Managing Director, APIIC, told Express. In fact, the move was recommended by the Delhi-based Singhania & Partners (S&P) in its 50-page report submitted to the State government in September. Subsequently, APIIC slapped a notice on Emaar to terminate development rights prompting the company to move the High Court. Its petition is likely to come up for hearing in January.
“Though we have tentative estimates of losses caused to the State due to agreement violations by Emaar, we are trying to audit the accounts and arrive at the exact figure,” Meena said. S&P, in its report, had suggested that the government withdraw development rights given to Emaar and allot the same to another developer. It had also recommended a revenue-sharing deal between Emaar and APIIC in case the former agrees to make good the loss it had caused.
So far, EHTPL sold about 136 villas spread across 33 acres in Nanakramguda. Similarly, it sold about 200 flats out of the 3,000 to be constructed in another 30 acres. Sources said Axis Bank valued Emaar’s share of 74 per cent in EHTPL at `800 crore.
Emaar, along with co-developer Emaar-MGF, spent about `400 crore in developing the project.
–Agencies