Rs 630 crore Gurgaon Land Scam: What is this case all about? FIR registered against Experion Developers
The Zee News report has made another great impression. Experion Developers and Experion Capital are two of the renowned real estate development companies in India that are undergoing legal proceedings of fraud and other false practices. The Economic Offenses Wing of the Delhi Police has registered an FIR against these developers following a complaint submitted by the Enforcement Directorate in connection to a fraudulent deal with land valued at about 630 crores in Gurgaon. Not only were different financial violations unearthed during the investigation but a scheme was also being run to break the law of bankruptcy.
What is it all about this case?
A complaint by the Enforcement Directorate (ED) initiated the investigation and a report by Zee News which alleged irregularities in the case. Investigation is on claims of loan manipulation, manipulation of creditor votes and the abuse of the insolvency procedure to purchase prime land at a very low price. But what is the exact case? What has been the most recent development in this case? Read the detailed story in order to know more.
The core of this whole controversy is a piece of prime real estate at Sector-62, Gurgaon. The claims suggest that the firm that bought the land, Experion Developers, incorporated complex practices to control the property without any government regulation.
Rs 630 crore Gurugram Land Scam.
The land in question was originally bought by a real estate firm known as Dignity Buildcon, which borrowed an estimated Rs 992 crores in six financial institutions to buy the property. Some of the six financial institutions include Standard Chartered Bank and Blackstone. The actual corruption started when the company went into bankruptcy proceedings after failing to pay the debt.
What was the role of Experion Capital?
Based on the investigation of the ED, the Experion Group had developed a complex scheme to seize assets to the tune of Rs 630 crore at only Rs 332 crore instead of directly acquiring the target company. Through this, the ED investigation exposed that the Group employed its own entity, Experion Capital, to allow Experion Group to tactfully assume control of Committee of Creditors (CoC). The reports state that Experion Capital bought a Rs 494 crore loan of Standard Chartered Bank at a 70 percent discount, which is worth Rs 160 crore and that it also acquired half the voting rights.
Experion supposedly purchased a Blackstone loan of 58 crores at a price of about 25 crores, and it allowed Experion to gain 10 percent on the total voting rights on the CoC. The statute does not allow a corporation to be the acquirer and a member of the CoC. Consequently, Experion ended up acquiring 95 percent of the entire voting rights in the CoC thereby co-approving the affiliate company resolution plan. This implies that Experion possessed the power of the purchasing power as well as the power of setting the sale price. Experion bought all these loans with the express purpose of gaining control of the CoC since the CoC decides who will purchase the bankrupt company.
What was the involvement of Alok Dhir?
Alok Dhir, a high profile corporate lawyer and the promoter of Alchemist ARC has been accused by the ED as having played a significant role in the scheme. According to the ED, one of the representatives of Alchemist ARC was purportedly compelled to vote in favor of Experion Capital. Dhir is alleged to have used his knowledge in law in order to gain and control distressed loans using his own firms.
The magnitude of the scam can be measured by the fact that the 9.32-acre piece of land on which the scheme is centred had already been taken over by the ED in relation to the Religare Finvest scam. The Experion Group is said to have fraudulently suppressed this very material information with the Tribunal and tried to unlawfully appropriate ownership over this land.
News Sources : https://www.zeebiz.com/real-estate/news-how-rs-630-crore-land-deal-triggered-fir-against-experion-developers-393140
