This property at 7 Sikandra Road, auctioned in 2006, was finally sold for Rs 122cr in April 2010.
NEW DELHI: The two sons of former chief justice of India Y K Sabharwal, who are being probed for their previous business deals, suddenly came to buy a Rs 122 crore property in Lutyens' Delhi four months ago, thanks to a series of controversial orders passed by the Delhi high court.
Chetan and Nitin Sabharwal, together with their partner Kabul Chawla, chief of real estate company BPTP, turned out to be the ultimate beneficiaries of high court orders passed since 2006 in connection with the auction of the 2.70-acre property at 7 Sikandra Road.
An appeal challenging the April 2010 sale deed revealed that the three partners had not participated in an auction in September 2006 on which a two-judge bench declared Triveni Infrastructure the highest bidder. Triveni was required to pay 25% of its bid amount, Rs 117 crore, within a week and the balance within three weeks thereafter, subject to the condition of the property being converted from leasehold to freehold.
But Triveni became liable to pay the 75% component only in February 2009 as it had taken so long for the property to be converted to freehold. It was then that a succession of single-judge orders, in breach of the schedule laid down by the larger bench, resulted in the payment being finally made, with a Rs 5 crore penalty, in April 2010, that too by the two Sabharwals and Chawla although they had no formal stake in Triveni.
The appeal being heard by a special bench headed by Justice A K Sikri shed light on the various ways in which the 2006 order had been bypassed, particularly by Justice Manmohan Singh, leading to a windfall for the Sabharwal brothers and Chawla:
* When the owners of the property filed a contempt application against Triveni for its failure to pay the balance in February 2009, Justice Manmohan Singh gave more time to the defaulter directing that it would have to pay Rs 3 crore by July-end and Rs 85 crore by October-end. Later, he extended the time further to December-end with a penalty of Rs 5 crore.
* The repeated extension of the deadline by Justice Manmohan Singh was contrary to the division bench's direction that if the highest bidder failed to make the payments on time, the property would have to be sold to the next highest bidder, Prime Commercial.
* In June 2009, Justice Manmohan Singh allowed a four-day old company, Angle Infrastructure, to come in place of Triveni for paying the balance and to take over the property. The owners of the property appealed against this order as it had been passed without any notice to them.
* A week before the expiry of the December 2009 deadline, Justice Manmohan Singh gave a fresh extension to Angle, this time by five months. He also granted Angle's request to introduce the condition that it would be required to pay the balance only when the owners were in a position to deliver immediate possession of the property. Most of the owners challenged this order, again because it had been passed without any notice to them.
* A month before the expiry of the May 2010 deadline, Triveni and Angle filed a joint application requesting that the balance be allowed to be paid by the Sabharwals and Chawla and that the property be registered in their names. Since the Sabharwal brothers and Chawla appeared in the court with demand drafts of the balance amount, Justice Rajiv Shakdher directed the owners on April 20 to execute the sale deed within two days.
That is how the Sabharwal brothers and Chawla acquired the property from an auction in which they had not participated at all. The appeal filed subsequently by the second highest bidder, Prime, challenged the manner in which the court had granted undue concessions to Triveni and deprived it (Prime) of its entitlement under the auction terms to buy out the property. Seeking a fresh auction of the Sikandra Road property, Prime offered to pay Rs 150 crore in keeping with the appreciation of the property value in these four years.
The real estate business partnership between the Sabharwal brothers and Chawla has been the subject of income tax probe following allegations that they had unduly benefited from the 2006 sealing drive against commercial properties in residential areas of Delhi launched by the then CJI, Justice Y K Sabharwal.
Chetan and Nitin Sabharwal, together with their partner Kabul Chawla, chief of real estate company BPTP, turned out to be the ultimate beneficiaries of high court orders passed since 2006 in connection with the auction of the 2.70-acre property at 7 Sikandra Road.
An appeal challenging the April 2010 sale deed revealed that the three partners had not participated in an auction in September 2006 on which a two-judge bench declared Triveni Infrastructure the highest bidder. Triveni was required to pay 25% of its bid amount, Rs 117 crore, within a week and the balance within three weeks thereafter, subject to the condition of the property being converted from leasehold to freehold.
But Triveni became liable to pay the 75% component only in February 2009 as it had taken so long for the property to be converted to freehold. It was then that a succession of single-judge orders, in breach of the schedule laid down by the larger bench, resulted in the payment being finally made, with a Rs 5 crore penalty, in April 2010, that too by the two Sabharwals and Chawla although they had no formal stake in Triveni.
The appeal being heard by a special bench headed by Justice A K Sikri shed light on the various ways in which the 2006 order had been bypassed, particularly by Justice Manmohan Singh, leading to a windfall for the Sabharwal brothers and Chawla:
* When the owners of the property filed a contempt application against Triveni for its failure to pay the balance in February 2009, Justice Manmohan Singh gave more time to the defaulter directing that it would have to pay Rs 3 crore by July-end and Rs 85 crore by October-end. Later, he extended the time further to December-end with a penalty of Rs 5 crore.
* The repeated extension of the deadline by Justice Manmohan Singh was contrary to the division bench's direction that if the highest bidder failed to make the payments on time, the property would have to be sold to the next highest bidder, Prime Commercial.
* In June 2009, Justice Manmohan Singh allowed a four-day old company, Angle Infrastructure, to come in place of Triveni for paying the balance and to take over the property. The owners of the property appealed against this order as it had been passed without any notice to them.
* A week before the expiry of the December 2009 deadline, Justice Manmohan Singh gave a fresh extension to Angle, this time by five months. He also granted Angle's request to introduce the condition that it would be required to pay the balance only when the owners were in a position to deliver immediate possession of the property. Most of the owners challenged this order, again because it had been passed without any notice to them.
* A month before the expiry of the May 2010 deadline, Triveni and Angle filed a joint application requesting that the balance be allowed to be paid by the Sabharwals and Chawla and that the property be registered in their names. Since the Sabharwal brothers and Chawla appeared in the court with demand drafts of the balance amount, Justice Rajiv Shakdher directed the owners on April 20 to execute the sale deed within two days.
That is how the Sabharwal brothers and Chawla acquired the property from an auction in which they had not participated at all. The appeal filed subsequently by the second highest bidder, Prime, challenged the manner in which the court had granted undue concessions to Triveni and deprived it (Prime) of its entitlement under the auction terms to buy out the property. Seeking a fresh auction of the Sikandra Road property, Prime offered to pay Rs 150 crore in keeping with the appreciation of the property value in these four years.
The real estate business partnership between the Sabharwal brothers and Chawla has been the subject of income tax probe following allegations that they had unduly benefited from the 2006 sealing drive against commercial properties in residential areas of Delhi launched by the then CJI, Justice Y K Sabharwal.
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