After studying law I vectored towards journalism by accident and it's the only job I've done since. It's a job that has taken me on a private jet to Jaisalmer - where I wrote India's first feature on fractional ownership of business jets - to the badlands of west UP where India's sugar economy is inextricably now tied to politics. I'm a big fan of new business models and crafty entrepreneurs. Fortunately for me, there are plenty of those in Asia at the moment.
The Supreme Court on Monday directed the Enforcement Directorate to take directors of bankrupt developer Amrapali Group into custody, on account of alleged violations of the Foreign Exchange Management Act and foreign investment norms in the real estate sector. It also passed an order on the attachment of JP Morgan’s India properties for its role in the transactions.
Amrapali, which has been admitted to the National Company Law Tribunal, has been battling allegations of diverting funds that buyers have paid in advance of construction. Its directors, Shiv Priya and Ajay Kumar, and former chairman and managing director Anil Kumar Sharma, are already in custody and will now be handed over to the Enforcement Directorate, which informed the court of a prima facie case against them for siphoning off money.
In October 2010, JP Morgan bought shares worth Rs 85 crore from the Amrapali Group. According to the agreement, the profits were to be split between Amrapali Homes Project Private Limited and Ultra Homes and JP Morgan, with 25 percent for the former and the rest for JP Morgan. JP Morgan declined to comment on the matter, saying it has not yet received a copy of the order.
The shares were repurchased by M/S Neelkanth and M/S Rudraksha for Rs 140 crore later in 2010, and the money allegedly remitted to the United States. According to the Enforcement Directorate, the firms that repurchased the shares had links with the statutory auditor of the Amrapali Group, and JP Morgan’s actions violated the Foreign Exchange Management Act. The case is part of an ongoing larger case against Amrapali’s directors for siphoning off buyer money.
The court also took stock of the award of construction contracts by state-run NBCC for the completion of Amrapali’s projects in Noida. It permitted the registration of flats in projects that have been handed over. The next date for hearing has been set for February 17.