Unitech: Buy a flat, wait 10 years, and some more

It’s a small world. The catchline on Unitech website had caught Ashok Kumar Gulati’s eye while he was browsing through it looking for a home. A decade on, the 72-year-old still looks up the site sometimes and regrets how the catchline has come to define his world since his decision to buy a flat — one that is restricted to attending protest meetings and court hearings.
Gulati, who is based in Gurugram, is not in the best of health but he is at the forefront of protests by homebuyers of various Unitech projects who have watched in despair as the company unravelled right before their eyes.

Unlike Jaypee or Amrapali, Unitech’s projects are not limited to NCR alone. The developer still has to deliver flats in 74 projects, of which 61 are in Delhi-NCR and the rest in Kolkata, Chennai and Lucknow. In Delhi-NCR, most of Unitech’s affected projects are in Gurugram.

“After booking a flat in Unitech Sunbreeze in Gurugram, I thought I had moved closer to my family’s dream of owning a house. I had no idea it would be the start of an unending struggle,” says Gulati, sitting on a sofa in his rented flat. “While hunting for a house a decade ago, I visited the developer’s website. I was impressed by the slogan, which read ‘they say it’s a small world... We at Unitech believe we are the reason behind it’. And today, I tell myself how true that is. It’s really a small world for me, restricted to the project site, courts, protests and unending questions from my family on our house,” he adds.
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The serious legal battles began in June 2015 when the National Consumer Disputes Redressal Commission (NCDRC) ordered Unitech to pay a penalty of 12% per annum for delaying flats to buyers of the Vistas project. Buoyed by that order, homebuyers in other Unitech projects also moved courts.
Launched in 2009, the Vistas, another project in Gurugram, was supposed to have been delivered by December 2012. Some of those who signed the builder-buyer agreement in 2010 were to get possession in 2013. It’s been six years of running around now for the buyers, who have no idea when the flats can be completed. “Most of us have taken housing loans for these flats and are also paying rent for a place to stay. This has put our finances in jeopardy and it is affecting other needs such as healthcare and education,” says Sharon Agarwal, a homebuyer.
In the Residences, also in Gurugram, though most buyers have moved to their flats, the project is yet to get a completion certificate because of dues. “Without the certificate, staying in the society is illegal. The authorities can ask us to vacate the premises anytime. In case of an accident in the building, we may not even be entitled to compensation,” says Naveen Kumar.
In Noida, too, Unitech has several pending projects — Verve, Horizon, the Residences and Uni Homes. Buyers in the Residences, who were supposed to get flats by September 2015, have filed complaints at various platforms for their delayed homes.
Earlier this month, the Supreme Court, which has been hearing the Unitech case, directed the Centre to submit a proposal for completing the company’s stalled projects.
A bench of justices DY Chandrachud and MR Shah had on July 9 said buyers who had approached the court could not be kept waiting. “We will wait for the government to come up with some kind of proposal for completing the pending projects,” the bench had said, rejecting a plea by Unitech to allow it to complete the projects over the next three years. The court had observed that the government should involve a third party like the state-run National Buildings Construction Corporation Limited (NBCC) to complete the projects. The Centre informed
the bench it was examining the issue. Apart from asking the attorney-general to submit a report, the court also said it would appoint a committee, headed by a former high court judge, to monitor construction work. On May 9, the Supreme Court had asked the government to study the possibility of taking over Unitech and completing all its pending projects On December 7, 2018, the apex court had directed a forensic audit of Unitech and its sister concerns and subsidiaries.
But the audit could not be completed, allegedly because of non-cooperation from the Unitech office. The bench has now granted two weeks’ time to the company to cooperate with the forensic auditors and provide them with all necessary details. It has also directed the auditors to submit their report in four weeks, posting the matter for further hearing this Tuesday.
The change in Unitech’s fortunes
Ramesh Chandra, an IITian with a degree in civil engineering, set up Unitech in 1972 with an aim of becoming one of the country’s real estate companies giants. Two of his sons — Ajay and Sanjay — joined him later in steering Unitech’s growth. Within 30 years, the company had become became one of the top real estate firms in the country, with projects in Gurugram, Noida, Greater Noida, Kolkata, Lucknow and other cities.
Over the next 10 years, Unitech saw fast-paced growth and launched around 100 projects across the country. In 2007, the Chandras were ranked among 10 richest persons in the country with a net worth of Rs 30,000 crore.
But as the economy slowed down in the mid-2000s, the realty firm suffered a major hit. Unitech hoped for a revival through diversification of businesses and signed a deal with Norway-based Telenor to launch Uninor, a telecom company. But before the company could take off, Sanjay Chandra, managing director of the new company, was arrested for his alleged involvement in the 2G scam.
Investors in under-construction projects had also filed around 100 complaints against the Chandras for delaying flats. On April 1, 2017, Sanjay and Ajay were arrested by Delhi Police on charges of cheating homebuyers. In December 2017, the National Company Law Tribunal, on a plea by the Centre, suspended all eight directors of Unitech.