BOARD'S REPORT
Dear Members,
Your Directors hereby present the 52nd Annual Report
and Audited Financial Statements of the Company for the
financial year ended 31st March, 2023.
Financial Results
The Financial Performance of the Company for the financial
year ended 31st March, 2023 is summarized herein below:
|
(Amount in Rs. Crore)
|
|
Particulars
|
2022-23
|
2021-22
|
|
Revenue from
Operations including
Other Income
|
132.14
|
132.14
|
61.14
|
61.14
|
|
Less: Expenses
|
|
|
|
|
|
Construction &
Real Estate Project
Expenditure including
|
48.88
|
|
48.89
|
|
|
Cost of Land Sold
|
|
|
|
|
|
Changes in Inventories
of Finished Goods,
work-in-progress and
Stock-in-Trade
|
|
|
|
|
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Employee Benefits
Expense
|
16.41
|
|
17.08
|
|
|
Finance Costs
|
2452.04
|
|
928.47
|
|
|
Depreciation and
Amortization Expense
|
2.51
|
|
2.52
|
|
|
Other Expenses
|
21.51
|
|
11.32
|
|
|
Total Expenses
|
|
2541.35
|
|
1,008.28
|
|
Profit/ (Loss) before Tax
and Exceptional Items
|
(2409.21)
|
|
(947.14)
|
|
|
Less: Exceptional Items
|
-
|
|
-
|
|
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Profit/ (Loss) before
Tax
|
|
(2409.21)
|
|
(947.14)
|
|
Profit/ (Loss) from
continuing operations
after Tax
|
|
(2409.21)
|
|
(947.14)
|
Material changes affecting the Company
There were no material changes or commitments affecting
the financial position of the Company having occurred
between the end of the financial year to which the Financial
Statements relate and the date of report, other than the ones
already provided or stated in the Financial Statements.
Financial Highlights
The total income of the Company for the year under review
is Rs. 132.14 crore. The loss before tax stood at Rs. 2409.21
crore and loss after tax also stood at Rs. 2409.21 crore. On
consolidated basis, the total income stands at Rs. 491.96
crore. The consolidated loss before tax stood at Rs. 3113.76
crore and loss after tax stood at Rs. 3103.29 crore.
Segmental Revenues (Consolidated)
On consolidated basis, the Real Estate and related division
contributed Rs. 158.28 crore in the coffers of the Company,
whereas the contribution from the Property Management
business was Rs. 136.90 crore, and Rs. 167.18 crore from
the Power Transmission business. Hospitality and other
segments contributed Rs. 29.59 crore towards the gross
revenue.
Business and Operations
During the year under review, there was no change in the
business of your Company.
Operating Environment
The operating environment this year continued to remain
challenging. Geopolitical conflict in Europe coupled with
the global supply chain disruptions led to an unprecedented
inflation in food, energy and commodity prices. Aggressive
monetary tightening measures from Central Banks world¬
wide led to further pressure on emerging economies. The
widespread inflation posed major challenges specifically
with prices of several commodities inflating to their decadal
highs. There was, however, a normalization in economic ac¬
tivities after a couple of years of Covid induced disruptions.
Management Discussion and Analysis Report
The Management Discussion and Analysis (MDA) report
for the year under review, as stipulated in regulation 34 and
Schedule V of the SEBI (Listing Obligations and Disclosure
Requirements) Regulations, 2015 (hereinafter referred to as
'Listing Regulations'), has been enclosed separately, which
may be read as an integral part of the Board Report.
Report on Corporate Governance
The Report on Corporate Governance, along with
compliance certificate from CS Kiran Amarpuri, Practicing
Company Secretary (CP No. 7348), confirming compliance
of the conditions of Corporate Governance as stipulated in
Schedule V of the Listing Regulations, has been enclosed
separately, which may be read as an integral part of the
Board Report.
Consolidated Financial Statement
The Audited Consolidated Financial Statements of the
Company, its subsidiaries, associates and joint ventures
provided in the Annual Report have been prepared in
accordance with the provisions of the Companies Act, 2013,
read with Ind. AS 110- "Consolidated Financial Statements"
and Ind. AS 28- "Investments in Associates and Joint
Ventures" and Ind. AS 31 -"Interests in Joint Ventures".
Subsidiaries, Joint Ventures & Associates
Pursuant to provisions of section 129 (3) of the Companies
Act, 2013, a statement containing salient features of Financial
Statements of subsidiaries, joint ventures and associates
(Form AOC-1) of Unitech Limited is attached to the Financial
Statements. The said Statement portrays the performance
and financial position of each of Company's subsidiaries,
joint ventures and associates. The policy for determining
material subsidiaries, as approved, may be accessed at the
Company's website http://www.unitechgroup.com/investor-
relations/policy-determining-material-subsidiaries.asp.
The names of Companies which have become or ceased
to be subsidiaries, joint ventures or associate companies
during the year
There has been no change in the subsidiaries, joint ventures
or associate companies during the year under review.
Annual Return
As required under section 92 of the Companies Act, 2013,
the Annual Return for the financial year ended March 31,
2023 is available on the website of the Company and can
be accessed at http://www.unitechgroup.com/investor-
relations/regulation-46-annual-return.asp for reference and
perusal.
Details of Directors
Members are aware that faced with numerous litigations
by a large number of homebuyers and other stakeholders,
the Hon'ble Supreme Court directed the Union of India vide
its Order dated 18.12.2019 to propose the appointment of
an independent Board of Directors for Unitech Limited. In
compliance thereto, the Central Government proposed
the constitution of a new Board of Directors, which was
approved by the Hon'ble Supreme Court vide its Order dated
20.01.2020 passed in Bhupinder Singh Vs. Unitech Limited
in Civil Appeal No. 10856/2016. Following from the above,
the Hon'ble Supreme Court was pleased to simultaneously
direct the supersession of the erstwhile Management with
the appointment of a new Board of Directors.
During the year under review, there have been changes in
the composition of the Board of Directors of the Company.
Mr. Balasubramanyam Sriram, Mr. Niranjan L. Hiranandani
and Mr. Anoop Kumar Mittal resigned from the office of
Directors with effect from 13.06.2022, 10.08.2022 and
12.08.2022 respectively. Ms. Uma Shankar was appointed
as Director on the Board of the Company with effect from
19.10.2022. The composition of the Board of Directors as on
31.03.2023 was as follows:
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Sr.
No.
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Name(s)
|
Designation
|
Date of
Appointment
|
|
1
|
Sh. Yudhvir Singh
Malik, IAS (Retd.)
|
Chairman &
Managing
Director
|
21.01.2020
|
|
2
|
Dr. Girish Kumar
Ahuja
|
Director
|
22.01.2020
|
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3
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Sh. Jitu Virwani
|
Director
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22.01.2020
|
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4
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Sh. Prabhakar Singh
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Director
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03.02.2020
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5
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Ms. Uma Shankar
|
Director
|
19.10.2022
|
Further, after the close of the financial year till the signing of
this report, no changes have taken place in the composition
of the Board of the Company.
Key Managerial Personnel
In compliance of the provisions of section 2(51) and 203
of the Companies Act, 2013, the following Directors and
Officials of the Company were designated as the Key
Managerial Personnel (KMP) of the Company during the year
under review:
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Sr.
No.
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Name(s)
|
Designation
|
|
1
|
Sh. Yudhvir Singh Malik
|
Chairman and
Managing Director
|
|
2
|
Sh. Ashok Kumar Yadav
|
Chief Executive Officer
|
|
3
|
Sh. Kailash Chand
Sharma
|
Company Secretary up
to the close of working
hours as on 31st March,
2023
|
|
4
|
Ms. Anuradha Mishra
|
Company Secretary
with effect from
1st April, 2023
|
Board Meetings
Thirteen (13) meetings of the Board of Directors were held
during the year under review. Details of the meetings are
provided in the Corporate Governance Report, which may
be read as an integral part of the Board Report.
Annual Evaluation of Directors, Committees and Board
All the Directors have been appointed by the Central
Government as its Nominee Directors. The annual evaluation
of performance of Directors, Committees and Board has,
therefore, not been undertaken.
Opinion of the Board with regard to integrity, expertise and
experience of the Independent Directors appointed during
the year
Ms. Uma Shankar was appointed as a Director by the
Ministry of Corporate Affairs vide its Order dated 19.10.2022,
in pursuance to the Order of the Hon'ble Supreme Court dat¬
ed 13.10.2022. Since all the Directors on the Board of the
Company have been appointed by the Central Government
with the prior approval of the Hon'ble Supreme Court, the
said opinion is not required to be provided. All the Directors,
including, Ms. Uma Shankar, who was appointed during the
FY 2022-23, are well known professionals from diverse fields
and have no personal/ pecuniary interest in the Company.
Statement on declaration by Independent Directors
The Directors of the Company have been appointed by
Central Government (Ministry of Corporate Affairs), in
compliance with the Order of the Hon'ble Supreme Court
dated 20.01.2020 and all the Directors are Nominee Directors.
Policy on Director's Appointment and Remuneration
The Directors of the Company have been appointed by
the Central Government with the prior approval of Hon'ble
Supreme Court. No remuneration is being paid to the
Directors of the Company, except sitting fee for attending the
Board/ Committee meetings. The remuneration of Chairman
& Managing Director of the Company, as being paid, has
been determined by the Central Government in the Ministry
of Corporate Affairs. Hence, there is no formal policy in place
in respect of appointment and remuneration of Directors.
Nomination and Remuneration Policy
The Nomination and Remuneration Policy containing criteria
for determining qualifications, positive attributes, and
independence of Directors, policy relating to remuneration
to Directors, Key Managerial Personnel and Senior
Management Personnel of the Company has been disclosed
in the Corporate Governance Report, which may be read as
an integral part of the Board Report.
Directors' Responsibility Statement
Subject to the Audit qualifications raised by the Statutory
Auditors, findings of the investigations by different
Investigating Agencies and decisions by different Courts
of competent jurisdiction, the Directors confirm in terms of
section 134(5) of the Companies Act, 2013, that:
(i) While preparing the Annual Accounts for the year
ended 31st March, 2023, the applicable accounting
standards have been followed along with proper
explanations relating to material departures;
(ii) The Directors have selected such accounting policies
and applied them consistently and made judgements
and estimates that are reasonable and prudent so as
to give a true and fair view of the state of affairs of the
Company as on 31 st March, 2023 and of the loss of the
Company for the year ended on that date;
(iii) The Directors have taken proper and sufficient care
for the maintenance of adequate accounting records
in accordance with the provisions of the Act for
safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities;
(iv) The Directors have prepared the annual accounts on an
on-going concern basis;
(v) The Directors under the new Management will lay
down sound internal financial controls to be followed
by the Company and that such internal financial
controls would be adequately commensurate with the
size of its operation and business; and
(vi) The Directors under the new Management will
endeavour to devise proper system to ensure
compliance with the provisions of all applicable
laws and that such systems would be adequate and
operationally effective.
Details in respect of frauds reported by Auditors under sec¬
tion 143 (12) of the Companies Act, 2013, other than those
which are reportable to the Central Government
To the best of our knowledge and belief and subject to
the (i) outcome of the ongoing investigations by various
Investigating Agencies pertaining to transactions transacted
during the period of erstwhile Management or even
otherwise, having cascading impact, (ii) outcome of the
cases pending in Courts of competent jurisdiction, and (iii)
Audit qualifications, no frauds were reported by the Auditors
under section 143(12) of the Companies Act 2013, for the
year under review.
Auditor and Auditors' Report
The Members of the Company appointed M/s GSA &
Associates, LLP, Chartered Accountants (FRN 000257 N/
N500339), as Statutory Auditors of the Company in the 50th
Annual General Meeting, for a period of five years till the
conclusion of 55th Annual General Meeting.
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Auditors' Report - Qualified Observations
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Management's Response to Independent Auditor's Report of the Statutory Auditors on the Audited Standalone
Financial Results of Unitech Limited for the Quarter and Financial Year ended 31.03.2023
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Sr.
No.
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Auditor's Observations
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Management's Response
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|
1
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(i) Unitech Limited ("the Company") held its annual
general meeting for last 2 years with delays. The
company had not applied for any extension for these
annual general meeting to the Registrar of Companies,
NCT of Delhi & Haryana and is in the process of
estimation of penalty and other implications due to
delay in holding of annual general meeting.
(ii) Further, the Company also delayed in filing of
its quarterly and annual/year to date results with
Security and Exchange Board of India "SEBI". The
Company has not taken any provision related to
penalty on account of such delay and management is
now planning to seek relief against such penalty from
SEBI.
(iii) We had given a disclaimer of opinion on the
standalone financial statements for the year ended
31st March, 2022 in respect of this matter.
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(i) The Annual General Meeting (AGM) for the year
ended 31st March, 2022 was due to be held latest
by 30th September, 2022. However, the AGM for
the FY 2021-22 was held on 31.03.2023. The new
management did not have access to complete
records of various transactions of the Company.
It caused delay in the finalization of accounts
and convening of Annual General Meeting. The
new Management has inherited several legacies
under various provisions of law, including non¬
compliances related to non-holding of Annual
General Meeting of Unitech Limited on or before
the due dates. Ever since the new Management
took control of Unitech Group as whole, it has
been endeavoring to make the Group compliant in
accordance with the provisions of the Companies
Act, 2013 and rules made thereunder and other
applicable laws.
(ii) The Company has scheduled its Annual General
Meeting for the FY 2022-23 on 29th September
2023, which is well within the prescribed time-lines.
(iii) The Management had taken up the issue of seeking
exemptions and waiver of penalties from MCA
as well as SEBI vide its letters dated 11.06.2020,
29.07.2020 and 27.08.2020 and had also sought
the intervention of Secretary MCA to take up the
matter with SEBI. The Secretary MCA also took
up the matter with Chairman SEBI vide his letter
dated 05.08.2020. SEBI responded vide its letter
dated 09.09.2020 informing that the BSE and NSE
had examined the issue in view of moratorium
granted by the Hon'ble Supreme Court and the
notice for suspension of trading of securities had
been withdrawn. Finding that there was no positive
response on waiver of penalties, the Management
filed an IA No. 81660 of 2021 and 81663 of 2021 on
16.07.2021 in the Supreme Court seeking requisite
reliefs, which is still pending. The above defaults on
the part of the Company were also placed before
the Hon'ble Supreme Court in the Action Taken
Report-III filed on 28.03.2022
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Sr.
No.
|
Auditor's Observations
|
Management's Response
|
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2.
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(i) We have made references to the Resolution
Framework (RF) for Unitech group which has been
prepared under the directions of the Board of
Directors of Unitech Limited appointed by the Central
Government pursuant to the afore-said order of the
Hon'ble Supreme Court and approved by the Board
of Directors in their Meeting held on June 17, 2020/
September 10, 2020/ October 28, 2020/ April 27, 2022
and which has been filed with the Hon'ble Supreme
Court. Through RF, the company has requested the
Hon'ble Supreme Court to grant some concessions
and reliefs so that the company is able to fulfil its
obligations towards the construction of the projects
and meet other liabilities.
(ii) As the RF has not yet been approved by the Hon'ble
Supreme Court, the impact of the proposed reliefs,
concessions etc. have not been considered in the
books of accounts.
(iii) We had given a disclaimer of opinion on the
standalone financial statements for the year ended
31 st March, 2022 in respect of this matter.
|
The points mentioned herein are informatory in nature
and the Management has no further comments to offer
on the same.
|
|
3.
|
Material uncertainty related to aoina concern
(i) Management has represented that the Standalone
Financial Statements have been prepared on a going
concern basis, notwithstanding the fact that the
Company has incurred losses and has challenges
in meeting its operational obligations, servicing its
current liabilities including bank loans and public
deposits. The Company also has various litigation
matters which are pending before different forums,
and various projects of the Company have stalled/
slowed down.
(ii) These conditions indicate the existence of material
uncertainty that may cast significant doubt about
Company's ability to continue as a going concern.
The appropriateness of assumption of going concern
is critically dependent upon the Company's ability
to raise finance and generate cash flows in future to
meet its obligations, and also on the final decision
of the Hon'ble Supreme Court on the Resolution
Framework. Also, the Board of Directors are exploring
various possible options for completion of ongoing
projects and are trying to generate additional possible
revenues by construction of new flats. This activity
is getting conducted under supervision of Justice
Abhay Manohar Sapre, as appointed by Hon'ble
Supreme Court of India.
(iii) We had given a disclaimer of opinion on the
standalone financial statements for the year ended
31 st March, 2022 in respect of this matter.
|
The Management has already stated its position in
the Resolution Framework submitted in the Hon'ble
Supreme Court on 15.07.2020, followed by updated
versions submitted on 05.02.2021 and 08.08.2022,
wherein the Hon'ble Supreme Court has been prayed
to grant certain concessions and reliefs so that the
Company is able to fulfil its obligations towards the
construction and completion of projects and meet other
liabilities. The reasons for opting against the winding up
the Company or its reference under IBC have fully been
explained in the application filed for submission of the
Resolution Framework.
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|
Sr.
No.
|
Auditor's Observations
|
Management's Response
|
|
4.
|
(i) The Company had received a 'cancellation of
lease deed' notice from Greater Noida Industrial
Development Authority ("GNIDA") dated
18th November 2015. As per the Notice, GNIDA
cancelled the lease deed in respect of Residential/
Group Housing plots on account of non¬
implementation of the project and non-payment of
various dues amounting to Rs. 105,483.26 Lakhs.
The said land is also mortgaged and the Company
has registered such mortgage to a third party on
behalf of lender for the Non-Convertible Debenture
(NCD) facility extended to the Company and, due to
default in repayment of these NCDs, the debenture
holders have served a notice to the Company under
section 13(4) of the SARFAESI Act and have also
taken notional possession of this land. The Company
had contractually entered into agreements to sell
with 352 buyers and has also received advances
from such buyers amounting to Rs. 6,682.10 Lakhs
(net of repayment). No contract revenue has been
recognized on this project.
(ii) GNIDA has, in the meanwhile, in terms of the Order
of the Hon'ble Supreme Court dated 18.09.2018,
deposited on behalf of the Company, an amount of
Rs. 7,436.35 Lakhs (Rs. 6,682.10 Lakhs and interest
@ 6% on the principal amount of Rs. 6,682.10 Lakhs),
out of the monies paid by the Company, with the
registry of the Hon'ble Supreme Court.
(iii) GNIDA has adjusted Rs. 9,200.00 Lakhs of Unitech
Group's liabilities towards the Company's other
projects with GNIDA and forfeited Rs. 13,893.42
Lakhs. The Company had paid a sum of Rs. 34,221.90
Lakhs, including Rs. 4,934.95 Lakhs of stamp duty on
the land, for the said land.
(iv) The matter in respect of the land is still pending
before the Hon'ble High Court of Allahabad, and
pending the final disposal, the Company has,
subsequently, shown the amount of Rs. 18,339.80
Lakhs as recoverable from GNIDA in its books of
accounts including stamp duty of Rs. 4,934.95 Lakhs
and lease rent paid of Rs. 6,113.11 Lakhs. Further, the
Company is also carrying
(a) Other construction costs amounting to Rs.
80,575.05 Lakhs in respect of the projects to
come upon the said land which also includes
interest capitalized of Rs. 69,684.68 Lakhs.
|
(i) The matter is still pending in the Hon'ble High Court
of Allahabad for final disposal. The Management
is hopeful that its stand shall be vindicated in the
Hon'ble Court and there shall be no adverse impact,
other than the one already disclosed.
(ii) As regards the amount of Rs. 7,436.35 lakhs (Rs.
6,682.10 lakhs interest @ 6% on the principal
amount of Rs. 6,682.10 lakhs), deposited with the
Registry of the Hon'ble Supreme Court, the said
amount has already been paid to 352 homebuyers
pursuant to the directions of Hon'ble Supreme
Court, which is a bit more than the principal amount
deposited by the said homebuyers.
(iii) Further, the Management is also in the process
of filing a comprehensive IA before the Hon'ble
Supreme Court qua GNIDA's demands raised
against Unitech, including seeking appropriate
directions on the instant issue.
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|
Sr.
No.
|
Auditor's Observations
|
Management's Response
|
| |
(b) Deferred liability on account of interest payable
to GNIDA appearing in the books of accounts as
on 31st March, 2022 amounting to Rs. 3,72,777.42
Lakhs (including Rs. 52,220.54 Lakhs booked on
account of interest during the year ended 31st
March, 2023). Out of the interest mentioned
above Rs. 4,846.67 Lakhs has been capitalized
in the books of accounts of the Company. The
same is in contravention of the provisions of
Indian Accounting Standards 23 "Borrowing
Costs".
(v) The impact on the accounts viz. inventory, projects
in progress, customer advances, amount payable to
or receivable from GNIDA, cannot be ascertained,
since the matter is still subjudice, as mentioned
hereinabove, vis-a-vis dues of the Company, and
hence, we are unable to express an opinion on this
matter.
We had given a disclaimer of opinion on the standalone
financial statements for the year ended 31st March,
2022 in respect of this matter.
|
|
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5.
|
(i) Confirmations/ reconciliations are pending in respect
of amounts deposited by the Company with the
Hon'ble Supreme Court. As per books of account,
an amount of Rs. 31,191.85 Lakhs deposited with
the Hon'ble Supreme Court Registry ("Registry")
is outstanding as at 31 st March, 2023. Management
has received certain details of payments made and
monies received in the registry from the Court and has
accrued the same in its books of accounts. However,
there are still variations of Rs. 934.15 Lakhs between
balance as per books of accounts vs balance as per
registry details and management is in the process of
reconciliation of the same.
(ii) Further, for the payments made from its registry,
there was no deduction made on account of tax
at source and no goods and services tax liability,
wherever applicable on reverse charge basis have
been complied with.
(iii) In view of the reconciliation exercise still in process
and absence of other statement of transactions
and confirmation of balance from the Registry, we
are unable to comment on the completeness and
correctness of amounts outstanding with the Registry
and of the ultimate impact these transactions would
have on the Standalone Financial Statements of the
Company, and hence we are unable to express an
opinion on this matter.
(iv) We had given a disclaimer of opinion on the
standalone financial statements for the year ended
31 st March, 2022 in respect of this matter.
|
(i) The observation is a statement of fact and needs no
further comments.
(ii) The Company received a detailed statement of
accounts from the Supreme Court's Registry in
the month of November, 2022. After reconciliation
of the accounts, entries pertaining to (a) interest
income of Rs. 4,980.00 lakhs upto 22.11.2022, (b)
disbursement of Rs. 2,734.11 lakhs, out of 4,000
lakhs deposited in the Supreme Court's Registry by
M/s Pioneer Urban Land & Infrastructure Limited,
and (c) disbursement of Rs. 2,183.45 lakhs to
homebuyers, FD holders and other stakeholders,
have been duly entered in the books of accounts
for the period ending 31.03.2023.
(iii) Further, during reconciliation, variations amounting
to Rs. 934.15 lakhs have been observed between
Balance as per books of accounts vis-a-vis Balance
as per Supreme Court's Registry, which is proposed
to be taken up with the Supreme Court Registry
and reconciled as soon as the relevant information
is received from the Registry.
(iv) As regards the TDS on the payments made
from the Registry or the TDS by the Bank on the
accrued interest, the Registry has not provided any
information. This will have to be verified from the
Supreme Court Registry. In any case, prima facie,
there should be no liabilities/ penalties on this
account qua the Company as the default, if any,
would be on the part of the Bank or the Supreme
Court Registry.
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|
Sr.
No.
|
Auditor's Observations
|
Management's Response
|
|
6.
|
According to information given and explanation provided
to us by the management, in respect of Property, Plant
and Equipment (PPE) including Investment Property
having net value of Rs. 2,996.56 Lakhs (net of accumulated
depreciation of Rs. 7,527.88 Lakhs), there is no physical
verification conducted by the Company since last year.
Further, the Company does not maintain proper records
showing full particulars, including quantitative details
and situation of Fixed Assets comprising 'property, plant
and equipment, 'capital work-in-progress' & 'investment
property''. In view of this and also of the fact that these
PPE's are kept as security for obtaining bank loans and all
the loan accounts of the Company (except loan obtained
from Punjab National Bank) are at non performing levels,
we are not able to express an opinion on this matter.
We had given a disclaimer of opinion on the standalone
financial statements for the year ended 31st March, 2022 in
respect of this matter.
|
The Company has maintained the Fixed Assets
Register for recording the details of Property, Plant
& Equipments. The management is facing a major
challenge in reconciling the Opening Balances, which is
a legacy issue and difficult to reconcile. However, it is
proposed to take up this exercise to prepare separate
lists of PPE where the reconciliation of Opening Balance
remains an issue. The challenges faced in reconciliation
of the Opening Balances, wherever occurring, will be
addressed separately.
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|
7.
|
Non-current investment and loans
Company has made investments and given loans to its
subsidiaries, joint ventures, associates and others. Details
as on 31st March, 2023 are as follows:
|
(i) Unitech Limited has 186 Indian Subsidiary
Companies out of which 08 subsidiary Companies
have been struck off by the Registrar of Companies,
NCT Delhi and Haryana. The Company has moved
the National Company Law Tribunal (NCLT) for the
revival of the subsidiaries which have been struck
off, out of which 02 have already been ordered to
be revived.
(ii) For 149 Indian Subsidiary Companies, Statutory
Auditors have been appointed so far whereas the
due process for settlement of accounts with the
existing Statutory Auditors in case of 16 other
Subsidiaries is underway. For the remaining 13
Subsidiaries, wherein there is a substantial foreign
investment, necessary steps are being taken by the
Company in this regard.
(iii) As regards 32 foreign subsidiaries along with Libya
Division and 03 foreign JVs, the management has
listed down their available details. The Audited
Balance Sheets of 04 foreign subsidiaries, 02
foreign JVs, and that of Libya Division are not
available with the Company. For rest of the
Companies, the last audited available Balance
Sheets are those of 31.03.2017 except for two
Companies whose available Balance Sheets are
those of 31.03.2010 and 31.03.2016. Moreover,
it is pertinent to mention that, as per information
available to the new management, the Central
Investigating Agencies are believed to be engaged
with the issues pertaining to these entities.
|
|
Amounts in Rs. Lakhs
|
|
Particulars
|
Amount
invested
|
Impairment
accounted
for till
31.03.2023
|
Carrying
amount
|
|
Equity investment -
Indian subsidiaries
|
75,342.84
|
30,745.68
|
44,597.16
|
|
Equity investment -
foreign subsidiaries
|
66,376.77
|
66,376.77
|
_
|
|
Equity investment -
joint ventures
|
54,041.94
|
-
|
54,041.94
|
|
Equity investment -
associates
|
299.25
|
-
|
299.25
|
|
Equity investment -
others
|
31,040.70
|
-
|
31,040.70
|
|
Debenture
investment
|
1,512.18
|
-
|
1,512.18
|
|
Investment - CIG
|
25,453.18
|
-
|
25,453.18
|
|
Corporate
guarantees
|
8.7
|
-
|
8.7
|
|
Loans given to
subsidiaries
|
372,702.40
|
1,589.05
|
371,113.36
|
|
Advances given to
subsidiaries
|
61,965.54
|
-
|
61,965.54
|
| |
|
Sr.
No.
|
Auditor's Observations
|
Management's Response
|
| |
Amounts in Rs. Lakhs
|
(iv) The matter regarding investment in Carnoustie and
CIG is already under scrutiny by the Investigating
Agencies and various attachment orders have
been passed by the Enforcement Directorate.
The Management has included the position of
Carnoustie and CIG in the Resolution Framework
submitted before the Hon'ble Supreme Court. It is
pertinent to mention here that Unitech Limited has
also filed an IA in the Hon'ble Supreme Court for
the recovery of the amount invested. The matter
has been heard but the order is awaited.
(v) However, keeping in view the investigations being
carried out by the ED, and the ED having filed
charge-sheets before the Adjudicating Authority
under PMLA, the Company is left with no option
but to await the final outcome in these matters.
|
|
Loans to Joint
Ventures and
Associates
|
8,381.00
|
|
8,381.00
|
|
Advances to Joint
Ventures and
Associates
|
20.33
|
|
20.33
|
|
Share Application
Money
|
46.5
|
-
|
46.5
|
|
Considering the fact that the accounts of the above-
mentioned foreign entities are not available with the
management and for Indian entities, they are not audited
since last 3-4 years plus also taking into account the factors
such as non-existence of any loan agreement stating
terms, conditions and duration of loan, accumulated
losses in above said entities, substantial/ full erosion
of net worth, significant uncertainty on the future of
these entities and significant uncertainty on recovery
of investments and loans, there are strong indicators of
conducting impairment/ expected credit loss assessment
for above mentioned investments and loans in accordance
with the principles of Indian Accounting Standards 36,
"impairment of assets" and Indian Accounting Standards
109 "financial instruments".
Further: -
(i) Equity investment - others include investment made
in M/s Carnoustie Management (India) Private Limited
(Carnoustie) of Rs. 31,005.45 Lakhs as on 31st March,
2023. Regarding this investment, the Company
has already filed an Intervention Application "IA"
before Hon'ble Supreme Court of India wherein, the
Company has stated that erstwhile management
has invested in equity shares of Carnoustie @ Rs.
1,000 - Rs. 1,500 per share including a premium of
Rs. 990 - Rs. 1,490 per share. As per IA submitted
by the Company, there was no basis available with
erstwhile management for such share valuation.
Also, there were certain plots allotted to Carnoustie
at a price much lower than the market rate as
on allotment date. Considering the nature of this
investment, same is to be valued at fair value through
other comprehensive income "FVTOCI" as required
under Indian Accounting Standards 109 "financial
instruments" but the Company has decided to carry
investment made in Carnoustie at cost as the matter
is subjudice.
|
|
Sr.
No.
|
Auditor's Observations
|
Management's Response
|
| |
(ii) Investment - CIG - The Company made investment of
Rs. 25,453.18 Lakhs in CIG Realty Fund for which no
details are available with the Company. As explained
by management, the Company is planning to file a
separate Intervention Application "IA" before Hon'ble
Supreme Court of India requesting Hon'ble Court
to take up this matter. Management also explained
that CIG funds are already under investigation by
Enforcement Directorate (ED) and Serious Fraud
Investigation Office (SFIO). Considering the nature
of this investment, same is to be valued at fair value
through other comprehensive income "FVTOCI" as
required under Indian Accounting Standards 109
"financial instruments" but the Company has decided
to carry investment made in CIG funds at cost as the
matter is under investigation by various authorities.
In view of non-existence of any impairment study,
non-existence of any expected credit loss policy in
the Company and accounting of investment at cost
which were otherwise to be carried at FVTOCI, we are
unable to express an opinion upon the adjustments,
if any, that may be required to the carrying value
of these non-current investments and non-current
loan and its consequential impact on the Standalone
Financial Statement.
We had given a disclaimer of opinion on the standalone
financial statements for the year ended 31st March,
2022 in respect of this matter.
|
|
|
8.
|
Impairment Assessment of Bank and Comorate
|
(i) There are a number of secured, unsecured and
operational creditors qua the Company and its
subsidiaries, JVs and other affiliates. Further, the
Company and the promoters have also given
various kinds of Guarantees, including Bank
Guarantees and Corporate Guarantees, the lists
whereof (to the extent of availability of records),
surviving or matured, have been shared with the
Statutory Auditors. However, it may not be possible
to vouchsafe at this stage that these are the only
Guarantees given by the Company.
(ii) The issues pertaining to secured, unsecured
and operational creditors have been covered in
Chapter-3 of the Resolution Framework (RF). Apart
from seeking various reliefs and concessions qua
such creditors, the RF also contains a provision on
invitation of Claims and settlement thereof (3.2).
These issues have yet not been adjudicated by
the Hon'ble Supreme Court. Hence, it is neither
possible nor feasible at this stage to undertake any
impairment assessment of secured creditors, and/
|
|
Guarantees
Standalone Financial Statements, wherein it is stated that
the Company is having outstanding bank and corporate
guarantee of Rs. 107,059.26 lakhs as per audited financials
for year ending 31st March, 2023. The Company has not
conducted any impairment assessment on the same
in accordance with the principles of Indian Accounting
Standards 109 "financial instruments". In view of the
same, we are unable to express an opinion on the same.
We had given a disclaimer of opinion on the standalone
financial statements for the year ended 31st March, 2022 in
respect of this matter.
|
|
Sr.
No.
|
Auditor's Observations
|
Management's Response
|
| |
|
or Corporate Guarantees till these related issues
are crystalized and settled by the Hon'ble Supreme
Court. Likewise, some of the investments/
advances made by the Company are a subject
matter of investigations being conducted by
various Central Investigating Agencies.
|
|
9.
|
Trade receivables and other financial assets
The Company has trade receivables and other financial
assets as on 31st March, 2023 as under -
|
The new Management is in the process of developing an
Expected Credit Loss Policy for the Company. However,
it has taken time due to various kinds of situations
coming to the notice of the management. Every effort
shall be made to finalize the same by March, 2024.
|
|
Rs. in Lakhs
|
|
Particulars
|
Amount
|
Provision
accounted
for till
31.03.2023
|
Carrying
amount
|
|
Trade Receivables
|
78,751.93
|
31,521.87
|
47,230.06
|
|
Security Deposits
|
52,818.32
|
934.04
|
51,884.28
|
|
Non-Current Loans
and Advances
|
100.00
|
-
|
100.00
|
|
Current Loans and
Advances
|
6,617.34
|
520.00
|
6,097.34
|
|
Advances for
purchase of Shares
|
31,079.48
|
31,079.48
|
-
|
|
Staff Imprest &
Advances
|
47.09
|
-
|
47.09
|
|
Advances to others
|
13.08
|
-
|
13.08
|
|
The Company has not assessed loss allowance for
expected credit losses on financial assets in accordance
with the principles of Indian Accounting Standards AS 109
- "Financial Instruments".
In view of non-existence of any expected credit loss
policy in the Company, we are unable to express an
opinion upon the adjustments, if any, that may be
required to the carrying value of these financial assets
and its consequential impact on the Standalone Financial
Statement.
We had given a disclaimer of opinion on the standalone
financial statements for the year ended 31st March, 2022 in
respect of this matter.
|
|
Sr.
No.
|
Auditor's Observations
|
Management's Response
|
|
10.
|
Inventory and project in progress
|
(i)
|
Five Project Management Consultants (PMCs)
|
| |
(i)
|
Standalone Financial Statement of the Company
as on 31st March, 2023, has shown inventory of
Rs. 62,517.96 Lakhs and projects in progress "PIP"
of Rs. 17,56,942.48 Lakhs. Company is currently
carrying these inventory and PIP items at cost, which
is computed based on percentage of completion
method under Indian Accounting Standard 115
"Revenue from Contracts with Customers". In view of
the fact that in majority of the projects of the Company,
construction and other operational activities are
on hold since last 24-60 months, there are high
indicators that such inventory and PIP assets should
be tested for evaluating their respective net realized
value "NRV" in accordance with the requirement of
|
|
have been engaged, with the approval of the
Hon'ble Supreme Court, who have substantially
completed Part-A of the Scope of Work assigned to
them. This includes "As-is-assessment" of various
projects i.e. the status of work done/ completed
during the period of erstwhile management. The
PMCs have backed their work with photographs
and videography of these projects so as to avoid
any conflicts when it comes to the claims of old
contractors' vis-a-vis the work to be done by the
new contractors. Based on this exercise, the PMCs
have worked out the BoQs of the remaining works,
which form the basis for preparation of Tender
Documents.
|
| |
|
Indian Accounting Standard 2 "inventories".
|
(ii)
|
About 130 to 140 Tenders would need to be floated
|
| |
(ii)
|
Further, management is in the process of verification
of title documents for land and other immovable
assets.
|
|
to complete the balance works, out of which 35
Tenders (Lot-1) were floated on 02.01.2023. On
scrutiny of bids, it was discovered that no bids
were received against 18 tenders (out of 35)
|
| |
(iii)
|
As per the explanation provided by the management,
|
|
whereas both the bids received in case of one
|
| |
|
pursuant to the approval of Hon'ble Supreme Court of
|
|
tender failed to meet the eligibility criteria and both
|
| |
|
India, Project Management Consultants (PMCs) have
|
|
the bids received in respect of another tender were
|
| |
|
been appointed for the projects for estimation of work
|
|
abnormally high, resulting in the rejection of bids
|
| |
|
done till date, cost to be incurred further to complete
|
|
for these 02 tenders. Thus, bids were required to
|
| |
|
the projects and to provide applicable completion
|
|
be called afresh in respect of these 20 (18 1 1)
|
| |
|
timelines. These PMCs have also conducted actual
|
|
tenders.
|
| |
|
physical assessment of the projects and submitted
their reports. Management was earlier of the view
that NRV assessment of inventory and PIP can be
made only after the appointed PMCs complete their
assessment of respective projects and submit their
final reports but the same is still awaited.
|
(iii)
|
In continuation thereto, 2nd Lot of 31 Tenders was
prepared by the PMCs, which was duly reviewed by
the EIL. Thus, a total of 51 Tenders (20 re-tenders
of Lot-1 and 31 tenders of Lot-2) were approved
by the BoD and Justice (Retd.) A. M. Sapre in the
month of April 2023 for uploading the same on
|
| |
(iv)
|
Further, the Company has during the year capitalized
|
|
Unitech's e-Tendering web-portal. Accordingly,
|
| |
|
expenses to the tune of Rs. 11,249.80 Lakhs as
|
|
these tenders were uploaded on the Unitech's web-
|
| |
|
construction expenses (including interest expense
|
|
portal on 08/09.05.2023.
|
| |
|
of Rs. 6,154.51 Lakhs). The same is in contravention
of the provisions of Indian Accounting Standard
16 "Property plant and equipment" and Indian
Accounting Standard 23 "Borrowing cost" as
construction activity for all the projects is stalled since
last 4-5 years. This has resulted in understatement of
current year loss by above said amount.
|
(iv)
|
The extended last date for submission of bids
in respect of these 51 Tenders was 22.06.2023.
On opening of Technical bids on 23.06.2023, it
was discovered that no bids had been received
in respect of 09 tenders. After completion of the
process of evaluation of Technical and Financial
bids, the management finalized the bids received
qua 34 tenders. This has been approved by the
Board of Directors, followed by Justice (Retd.) A.M.
Sapre on 18.08.2023.
|
| |
| |
|
Sr.
No.
|
Auditor's Observations
|
Management's Response
|
| |
Also further, the Company, in its financial statements has
bifurcated PIP under two headings - “Project in progress
on which revenue is not recognized" and “Amount
recoverable from project in progress (on which revenue
is recognized)". We have not been provided with any
basis on which this bifurcation is made.
In view of the absence of any NRV assessment by the
management and absence of any physical verification
report, capitalization of expenses and interest cost
during the year, and absence of any basis of bifurcation
of projects in financial statements, we are unable to
express an opinion upon the existence and adjustments,
if any, that may be required to the carrying value of
these inventories and PIP and its consequential impact
on the Standalone Financial Statements.
We had given a disclaimer of opinion on the standalone
financial statements for the year ended 31st March,
2022 in respect of this matter.
|
(v) Projects in Progress (PIP) on which revenue is
not recognized refers to those projects where no
inventory is available for sale and only expenditure
is to be made for the completion of residual works
in such projects.
|
|
11.
|
External Confirmation
The Company has not initiated the process of external
confirmation for outstanding balances of the following
areas as on 31st March, 2023 are as follow:
|
(i) It is stated that as per Standards on Auditing
(SA)-505, prescribed by the Institute of Chartered
Accountants of India (ICAI), the process of external
confirmation is to be initiated by the Statutory
Auditors for directly obtaining the evidence from
the confirming parties at their level. However,
the management would initiate this exercise now
keeping the Statutory Auditors in loop for the with
respect to outstanding balances as on 31.03.2023.
It would, therefore, be appropriate that the
Statutory Auditors take up external confirmations
based on random sampling basis since obtaining
confirmation from all the parties would be a time¬
consuming exercise.
(ii) As far as the liability of the Company towards the
secured, unsecured or operational creditors is
concerned, the same has been covered in Chapter-3
of the Resolution Framework (RF) submitted before
the Hon'ble Supreme Court. The RF also contains a
provision on the Process of Claim Settlement qua
such creditors according to which the Company
shall be inviting claims from all such stakeholders
but it can be done only after a definitive view on the
RF is taken by the Hon'ble Supreme Court.
|
|
Amounts in Rs. in Lakhs
|
|
Particulars
|
Amount
|
Provision
accounted
for till
31.03.2023
|
Carrying
amount
|
|
Trade Receivable
|
78,751.93
|
31,521.87
|
47,230.06
|
|
Trade Payable
|
82,070.64
|
386.34
|
81,684.30
|
|
Advances received
from Customers
|
10,97,542.77
|
-
|
10,97,542.77
|
|
Advances to Suppliers
|
7,235.30
|
-
|
7,235.30
|
|
Security Deposits
|
52,818.32
|
934.04
|
51,884.28
|
|
Loans and advances
to Subsidiaries
|
4,38,577.05
|
1,589.05
|
4,36,988.00
|
|
Loans to Joint Venture
and Associates
|
8,381.00
|
-
|
8,381.00
|
|
Other Loans and
advances
|
6,717.34
|
520.00
|
6,197.34
|
|
Advances for
purchase of land
and project pending
commencement
|
61,287.37
|
30,000.00
|
31,287.37
|
|
Loans from
Subsidiaries,
Joint Venture and
Associates
|
80,368.23
|
|
80,368.23
|
|
Security and other
deposits payable
|
42,995.92
|
-
|
42,995.92
|
|
Staff Imprest
|
47.09
|
-
|
47.09
|
|
Inter Corporate
Deposits
|
13,853.66
|
-
|
13,853.66
|
|
Other Assets
|
6,349.22
|
-
|
6,349.22
|
Particulars of Loans, Guarantees or Investments
Particulars of Loans and Guarantees given or Investments
made under section 186 of the Companies Act, 2013, are
given in the respective Notes to Standalone Financial
Statements.
Contracts or arrangements with Related Parties under sec¬
tion 188(1) of the Act
With reference to section 134(3)(h) of the Companies Act,
2013, all Related Party Transactions (RPTs) under section 188
of the Companies Act, 2013 and regulation 23 of the Listing
Regulations were placed before the Audit Committee and
the Board. All contracts/ arrangements/ transactions made
by the Company during the relevant year with the Related
Parties were in the ordinary course of business and on an
arm's length basis.
As detailed in Note No. 46 of Standalone Financials
Statement, the Company has not entered into any transaction
with related parties during the year under report, which
could be considered material in accordance with the policy
of the Company on materiality of Related Party Transactions.
In view of the same, giving particulars of contracts or
arrangements with the Related Parties in Form AOC-2 is not
required for the year under review. The Company has framed
a policy on dealing with Related Party Transactions and the
same is available at Company's website www.unitechgroup.
com. Your Directors draw your attention to Note No. 46
to the Standalone Financial Statement, which sets out the
related party disclosures.
The State of the Company's Affairs
1. The Directors of your company had engaged M/s
Anarock Consultants Private Limited to carry out the
market valuation of unsold inventories of Unitech
Group on a representative basis in its various
residential projects as on 31.03.2021, with a stipulation
that it would revalidate the market value of unsold
inventories as of 01.10.2023 also. In compliance of the
same, M/s Anarock has revalidated the market value of
the unsold inventories as of 01.10.2023 and submitted
its final report to the Management.
2. During the year under review, the Management issued
a public notice dated 31.08.2022 regarding meetings
with the homebuyers of Unitech's Noida Projects. The
said meetings were convened to share the thought
process of the new Management about the future
roadmap planned for Noida Projects and to seek the
consent of homebuyers on the Proposed Revised
Layout Plans, subject to approval of the Competent
Authority, to improvise the planning of Projects
with suitable modifications in compliance of (i) Uttar
Pradesh Apartment (Promotion of Construction,
Ownership and Maintenance) Act, 2010, and (ii) UP
Real Estate Regulation Act, 2016. Meeting for the
Unitech Golf and Country Club, Sector 96-97-98, Noida,
was held on 04.09.2022, followed by Unihomes-3 in
Sector-113 Noida and Unihomes in Sector-117, Noida,
on 06.09.2022 and 08.09.2022, respectively. It may be
noted that the number of consents received from the
homebuyers fulfilled the requisite 2/3rd requirement as
per law. Pursuant thereto, the Revised Layout Plans and
Building Plans have been submitted to Noida Authority
along with the Consent Forms. Approval of the Noida
Authority is still awaited.
3. During the year under review, the Management of your
Company has submitted 25 applications for renewal
of licenses to the Department of Town and Country
Planning, Haryana on 08.07.2022 and deposited the
current renewal fees also with respect to the same.
The Town & Country Planning Department has already
granted renewal of 24 out of 25 Licenses vide its orders
dated 07.09.2022. Further, applications have also been
submitted for Grant of Occupation Certificates (OCs) in
respect of six projects of Unitech in Gurugram, out of
which four have duly been granted by the competent
authority. Further, applications for release of revised
Building Plans were submitted for three projects,
which have been sanctioned. Out of the Zoning Plans
submitted for three projects, the same have been
approved for two projects.
4. During the year under review, on the directions of the
Hon'ble Supreme Court vide its order dated 17.08.2022,
the Revised Payment Plan along with details regarding
the tentative timelines for completion of the residential
projects was uploaded on the website of the Company
on 19.08.2022. The Homebuyers were requested to
give their comments/ suggestions on the Revised
Payment Plan to a dedicated e-mail id. Accordingly, 503
e-mails were received on the subject. The suggestions/
observations of 503 homebuyers were compiled along
with the management's response thereto and filed
before the Hon'ble Supreme Court. As on the date of
this report, the said issue is yet to be adjudicated by the
Hon'ble Supreme Court.
5. During the year under review, the matter of sale of
Unitech Power Transmission Limited (UPTL) has also
been under consideration. The Board of Directors
accorded their approval to engage M/s. Ernst & Young
(EY) as Transaction Advisers for the divestment of
UPTL in the Meeting of the BoD held on 14.02.2023 at a
success fee of 1.75% of the Enterprise Value, capping
of OPE at Rs. 5 lakhs and with an exclusivity period
of 09 months. The matter of divestment of UPTL was
put up on the website of Unitech Limited on 06.04.2023
inviting Expressions of Interest (EOI) from interested
parties till 19.04.2023. In addition, M/s E&Y had also
sent communications to 37 prospective investors. A
total of 10 parties submitted their EOIs by the due date.
Following from the above, Non-disclosure Agreements
(NDAs) were signed with these 10 parties. Another
Notice was uploaded on the Unitech's Website and
on the e-Tendering portal on 26.04.2023 inviting non¬
binding offers from these 10 parties up to 01.05.2023.
In response thereto, non-binding offers were received
within the fixed timelines only from 04 parties, namely,
(a) M/s Jakson Limited (Rs. 65 Crore), (b) M/s JSC
OGCC Kazstroyservice (Rs. 25 Crore), (c) M/s Shilpa
Steel and Power Limited (Rs. 20 Crore), and (d) M/s
Shree Metals (Mujbi) Private Limited (Rs. 10 Crore). The
non-binding term-sheets were opened on 02.05.2023.
Since the value offered by M/s Jakson Limited was
found to be the highest among all the bidders, it was
allowed to conduct Due Diligence as per the process
note prepared by E&Y in consultation with UPTL to
facilitate the highest bidder to submit its Binding Offer
on or before 17.06.2023. Eventually, the Binding Term
Sheet for an amount of Rs. 65 Crore was received on
17.06.2023, along with a BG of Rs. 1.00 Crore. The
highest bidder had subsequently agreed to improve
its offer to Rs. 67.00 Crore. The Board has already
approved the proposal by Circulation.
6. The Hon'ble Supreme Court, vide its order dated
18.05.2022, appointed Justice (Retd.) A. M. Sapre to be
associated with every stage of tendering process and
that the same be carried out under his supervision. Based
on the ground-work done by PMCs, it was estimated that
about 130 Tenders would be required to be floated for
completion of all the 74 residential and 12 commercial
projects. Since, it was practically not possible to float
all the 130 tenders in one go, the Management decided
to float these 130 odd tenders in four to five Lots with
each Lot comprising about 30-35 tenders. Accordingly,
after the approval of the Board of Directors (BoD) and
Justice (Retd.) A. M. Sapre in the month of November/
December 2022, a total of 35 Tenders (as Lot-1) were
floated on 02.01.2023 on Unitech's e-tendering web
portal etenders.unitechgroup.com. After the last
date of submission of tenders, it was discovered that
no bids were received against 18 tenders (out of 35)
whereas both the bids received in case of one tender
failed to meet the eligibility criteria and both the bids
received in respect of another tender were abnormally
high, resulting in the rejection of bids for these 02
tenders. Thus, bids were required to be called afresh
in respect of these 20 tenders (18 1 1). Balance 15
tenders, which were found to be technically eligible
and financially acceptable, were recommended for
Award of Contracts by the PMCs and EIL, which in
turn was duly approved by the BoD in April, 2023 and
submitted to Justice (Retd.) A.M. Sapre for his approval
and onward recommendation to the Hon'ble Supreme
Court seeking its permission for Award of Contracts to
the successful bidders qua these 15 tenders. Justice
(Retd.) A. M. Sapre scrutinized the same and submitted
his recommendations to the Hon'ble Supreme Court.
Approval of the Hon'ble Supreme Court for Award of
Contracts in respect of these 15 Tenders is awaited.
The Letters of Intent (LoIs) would be issued to the
Contractors after approval of the Hon'ble Supreme
Court is received and works would commence at the
respective projects thereafter.
7. In continuation of the Tendering process, 2nd Lot of 31
Tenders were prepared by the PMCs and duly reviewed
by the EIL. Thus, a total of 51 Tenders (20 re-tenders
of Lot-1 and 31 tenders of Lot-2), duly approved by
BoD and Justice (Retd.) A. M. Sapre, were uploaded
on Unitech's e-tendering web portal on 08.05.2023 and
09.05.2023. Accordingly, these tenders were uploaded/
floated on the portal. A total of 103 bids were received
against 42 Tenders as no bids were received against 09
Tenders. Finally, after technical and financial evaluation
and negotiations held with 15 bidders, bids received
against a total of 34 Tenders have been finalised,
approved by the Board and Justice Sapre. As on date,
15 Tenders of Lot-1 and 34 Tenders of Lot-2, have been
recommended by Justice (Retd.) A.M. Sapre for the
approval of the Hon'ble Supreme Court.
8. During the year under review, M/s MSTC were engaged
as the Auctioneers for handling the auction of various
unencumbered land assets of Unitech Group. M/s MSTC
has an experience of about 50 years in conducting/
handling auctions of various items including properties
belonging to various Government Organizations and
has developed a robust e-auction platform for the
purpose. Further, the e-auction processes had been
approved to be incorporated in the Land Sale Policy
and SOP which has been duly approved by the Hon'ble
Supreme Court vide its order dated 17.08.2022. As on
the date of this report, M/s MSTC has been supplied
with information in order to develop the auction
catalogue and it is proposed that the unencumbered
properties will be hosted for e-Auction shortly.
9. Document Management System/ Content Management
System has been installed and configured in the
Company. Data Storage Structure for Documents
related to Projects has been created. Project Documents
in electronic format are being moved to the DMS.
Amount, if any, proposed to be carried to any Reserves
As the Company is incurring losses since last several years,
no amount is proposed to be carried to any reserve during
the year under review.
Dividend
As your Company has incurred a net loss during the year
under review, your Directors have not recommended any
dividend for the year ended 31st March, 2023.
Conservation of Energy, Technology Absorption
Since the Company does not own any manufacturing
facility, except Unitech Power Transmission Limited (UPTL),
a wholly-owned subsidiary company, the requirement of
disclosure of particulars relating to conservation of energy
and technology absorption is not applicable.
Foreign Exchange Earnings and Outgo
The Company is engaged in developing/ constructing
residential and commercial properties in India and it used
to sell the immovable properties to customers in India and
abroad in the past. However, no sale of immovable properties
has been carried out after the change of Management.
During the year under review the Company has not sold
any overseas property. The foreign exchange earnings and
outgo of the Company during the year under review were
NIL.
Risk Management
Risk Management Policy of the Company is in place and has
been updated and approved in the meeting of the Board of
Directors held on 13.07.2023. The objective of the policy
is to identify and assess the key risk areas, and to mitigate
risks, and monitor/ report effectiveness of the processes and
controls and advance action, which may need to be taken to
mitigate such risks.
Corporate Social Responsibility
The Company has not undertaken any CSR activities
during the year under review, since there is loss during the
preceding three financial years. The Annual Report on CSR
activities is attached herewith at Annexure-2, which may be
read as an integral part of the Board Report.
Internal Financial Control for Financial Statements
The Board of Directors have been reviewing the sufficiency
of existing internal control systems and assessing the
need to bring better financial control measures, which are
commensurate with the size of the business of the Company.
Audit and Risk Management Committee
The composition of the Audit and Risk Management
Committee is provided in the Corporate Governance Report,
which forms an integral part of the Board Report.
Vigil Mechanism
Pursuant to section 177 (9) of the Companies Act, 2013,
read with rules made thereunder and regulation 22 of the
Listing Regulations, the Company has Vigil Mechanism for
Directors and Employees to report genuine concerns. The
policy has been posted at Company's website i.e. http://
www.unitechgroup.com/investor-relations/whistle-blower-
policy.asp During the year under review, the Company has
not received any such report in this behalf.
Secretarial Standards
The Company has devised proper systems to ensure
compliance with the provisions of all applicable Secretarial
Standards issued by the Institute of Company Secretaries
of India and that such systems are adequate and operating
effectively.
Deposits
During the year under review, the Company has not accepted
any Deposits under the provisions of section 73 and 76 of the
Companies Act, 2013, read with Companies (Acceptance of
Deposits) Rules, 2014. Particulars of Deposits covered under
Chapter V of the Companies Act, 2013 are as follows:
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Particulars
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Details
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Amount of Deposits accepted during the
financial year 2022-23.
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NIL
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Amount of Deposits remained unpaid or
unclaimed during the year, i.e. as on 31.03.2023
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Rs. 537.44 crore (Principal Amount)
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Whether there has been any default in
repayment of Deposits or Interest thereon; and
if so the number of times and the total amount
involved-
? At the beginning of the year
? Maximum during the year
? At the end of the year
Details of Deposits which are not in Compliance
with Chapter V of the Companies Act, 2013
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(i) The Company had filed an application in March 2015 before the
Hon'ble CLB [Now NCLT] for seeking, inter-alia, re-scheduling of
repayment of Fixed Deposits. The Hon'ble National Company Law
Tribunal, New Delhi (NCLT) dismissed the said application. The appeal
against the said order was also dismissed by the Hon'ble NCLAT vide
its order dated 31st January, 2017.
(ii) Some Depositors filed intervention applications (IAs) before the
Hon'ble Supreme Court in the matter of homebuyers of the Company.
Considering their applications, the Hon'ble Supreme Court directed
the Amicus Curiae to create a web-portal where the Depositors could
provide their requisite information. Accordingly, in compliance of the ibid
direction, the Ld. Amicus Curiae created a web-portal for the purpose.
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(iii)
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Hon'ble Supreme Court vide its order dated 12th December, 2019,
allowed refunds to FD holders who were senior citizens, aged 60 years
and above. Ten per cent of the amount deposited with the Registry at
that time i.e. Rs. 17.4 crore was allocated for the purpose. Having regard
to the huge number of FD holders, who had registered themselves on
the web-portal, the Hon'ble Court allocated a further sum of Rs. 30
crore for distribution amongst them. The additional amount of Rs. 30
crore was also to be disbursed to FD holders of the age group of 60
years and above, in terms of the earlier direction/s. Out of the allocated
sum of Rs. 47.40 Crore allocated, an amount of Rs. 31.23 Crore has
been disbursed till 22.11.2022 as per the report of the Registry of the
Hon'ble Supreme Court.
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(iv)
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Further, the Hon'ble Supreme Court, on recommendations of Justice
Sapre, approved the release of Rs.13.19 Crore for payment of the
principal amount of Fixed Deposits to 548 FD holders vide its order
dated 01.02.2023 on grounds of medical exigencies. The said amount
has been received in the Company's Account. As on 10.07.2023, a
total of Rs. 12.90 Crore has been refunded to 501 FD Holders. The
outstanding principal amount payable to the FD holders amounts to
Rs. 535.87 Crore as on 10.07.2023.
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(v)
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Accordingly, the matter pertaining to public deposits is presently before
the Hon'ble Supreme Court as addressed in Chapter 8 of the Resolution
Framework. Hence, the final action in this behalf would depend on the
finality of the matter at the level of the Hon'ble Apex Court.
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Particulars of Employees and Related Disclosures
The ratio of remuneration of each Director to the median
employees' remuneration and other details in terms of section
197 (12) of the Companies Act, 2013, read with rule 5 of the
Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, is provided as Annexure-3, forming
part of this report.
During the year under review, no employee was drawing
remuneration of Rs 1.02 crore per annum which is required
for inclusion in the statement containing particulars of
employees as required under section 197 of the Companies
Act, 2013, read with rule 5 of the Companies (Appointment
and Remuneration of Managerial Personnel) Rules, 2014.
Significant and Material Orders
During the year under review, apart from various Orders
passed by the Hon'ble Supreme Court, there were no
significant and material orders passed by the regulators or
tribunals that may impact the 'going-concern-status' and
Company's operation in future.
Details of applications made or any proceedings pending
under the Insolvency and Bankruptcy Code, 2016 during the
year along with their status as at the end of the financial year
During the year under review, no application was made nor was
any proceeding pending under the Insolvency and Bankruptcy
Code, 2016, as per the records available with the Company.
Details of difference between the amount of valuation done
at the time of one-time settlement and the valuation done
while taking loan from the Banks or Financial Institutions
along with the reasons thereof
The same is not applicable for the year under review.
Cost Accounts and Cost Auditors
The Company is required to make and maintain cost records
as specified by the Central Government under sub-section
(1) of section 148 of the Act. The Company has in its Board
Meeting held on 13.07.2023 appointed M/s Pant S. &
Associates (FRN: 101402) as Cost Auditors of the Company
for conducting audit of cost records from FY 2022-23 to
2023-24. The remuneration to be paid to the Cost Auditor for
FY 2022-23 & 2023-24 will be ratified in the ensuing Annual
General Meeting of the Company.
Further, the observations of the Cost Auditor as given in his
Cost Audit Reports for the Financial Years from 2017-18 to
2021-22 are given herein below along with the response of
the Management on the same -
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Cost Auditor's Observation
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Management Response
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Company has to maintain detail
of area constructed during the
financial year, that detail is not
available at Company's end.
Instead of area constructed,
Company has mentioned each
project as different service and
mentioned one (01) quantity
against each project.
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The Company has been
maintaining the details
of each project as one
single entity, as a standard
practice from its inception,
since calculations of
amounts spent qua the
area constructed each
unit-wise is not practically
feasible.
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Prevention of Sexual Harassment at work place
The Company has complied with the provisions relating
to the constitution of the Internal Complaints Committee
under the Sexual Harassment of Women at Workplace
(Prevention, Prohibition and Redressal) Act, 2013 and the
Rules framed thereunder. During the year under review, no
case/ complaints pursuant to the same were reported to the
Board.
Acknowledgments
Your Directors wish to place on record their deep sense
of appreciation for the co-operation received from the
Members, Government authorities, customers and vendors.
Your Directors also wish to place on record appreciation
for the contribution made by each and every employee
of the Company. The Directors are also thankful to all the
stakeholders for their continued help, assistance and support.
For and on behalf of Board of Directors
For UNITECH LIMITED
(Yudhvir Singh Malik)
Chairman & Managing Director
Unitech Group of Companies
DIN: 00000555
Date: 29th August, 2023
Place: Gurugram
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