The Yamuna Expressway Industrial Development Authority (YEIDA) has lodged a complaint against SDS Infracon, alleging the misappropriation of Rs 182 crore from homebuyers. The funds were intended for the NRI Township project in Sector 26A, an investment made by approximately 1,400 buyers since 2010, who are still awaiting their plots.
The controversy dates back nearly six years, with the complaint highlighting that the realty firm diverted the substantial sum to other companies. Despite a police closure report in 2020, the Authority contested this decision, leading to a reinvestigation order by the Allahabad High Court.
An audit in December 2017 revealed that SDS Group redirected the money to SDS Infracon, SDS Infotech Pvt Ltd, and Arnava Techno Soft Pvt Ltd. Following this, the developer faced charges under the Companies Act and other sections of the IPC for fraud, based on a complaint from YEIDA in June 2018. To safeguard the investors' interests, YEIDA instructed SDS Group to open an escrow account for the diverted funds and to clear its dues of Rs 379.8 crore, neither of which was complied with by the developer.
In February last year, YEIDA filed a protest application challenging the police's 2020 closure report. The Authority argued that crucial documents were not reviewed and the implicated companies were not adequately investigated.
On July 14, a local court supported YEIDA's protest and ordered a reinvestigation. SDS Group then sought relief from the Allahabad High Court, disputing the magistrate's authority to reopen the case. However, on May 6, Justice Vikram D Chauhan upheld the lower court's order, affirming the magistrate's jurisdiction for further investigation, as the objections raised by YEIDA were deemed valid.
The court stated, "The applicants (SDS Group) have not shown before this court that the objection raised to the investigation/final report by the opposite party No. 2 (Yamuna Authority) was without foundation. The magistrate concerned has jurisdiction to direct for further investigation where a final report/closure report is filed after investigation."
YEIDA CEO Arun Vir Singh announced plans to request the Uttar Pradesh government to reassign the investigation to a different agency to ensure impartiality and thoroughness.
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