SC restores 213 flats of Udaipur-based project after ED proactively helps homebuyers

New Delhi, Oct 14 (PTI) In relief to over 200 home buyers of Udaipur-based Project Royal Rajvilas (RRV), the Supreme Court has released their flats attached by the Enforcement Directorate (ED).

Besides, the apex has also closed the probe agency's challenge to the insolvency resolution process, where the Mumbai bench of the NCLT had approved a new owner of Udaipur Entertainment World Pvt Ltd (UEWPL) who is willing to complete the project. UEWPL was the original project owner.

The apex court also lauded the efforts of the ED in bailing out over 200 home buyers, whose dream houses were stuck for the last 12 years.

However, regarding 11 flats, which are suspected to be part of the proceeds of crime, a two-member Supreme Court bench said their provisional attachment shall continue.

The matter relates to the RRV project, where ED is probing embezzlement of over Rs 1,200 crore against Bharat Bomb in Syndicate Bank (now Canara Bank) using the modus operandi of discounting of forged cheques, discounting of forged inland bills and drawing loans against forged insurance policies.

The ED had also issued various attachment orders, which also include Proceeds of Crime (POC) of Rs 83.51 crore in the form of unsold inventory from UEWPL.

Later, UEWPL was also dragged into insolvency proceedings, where a resolution plan (bid) was approved by the Mumbai bench of the National Company Law Tribunal (NCLT) on February 24, 2022.

The ED approached the NCLT, and the matter also reached the Rajasthan High Court, which stayed the NCLT order approving bids, saying the insolvency tribunal has no jurisdiction to set aside the order passed by the Adjudicating Authority (PMLA) under section 8 of the PMLA, 2002.

This high court order was challenged by the new management of UEWPL before the Supreme Court.

In this matter, the apex court directed ED to protect the interest of the bona fide homebuyers, who had invested their money in the project and could not get possession of their units/flats, due to the vexatious legal proceedings before different judicial forums.

Following this, the ED approached the Resolution Professional and the new management of UEWPL, seeking the details of all the homebuyers whose claims were admitted before the NCLT.

After scrutinising the details, the ED submitted a 'No Objection' before the Supreme Court for restitution of the attached properties for the benefit of bona-fide homebuyers except 11 flats/ units pertaining to 8 homebuyers.

An affidavit was filed by ED on October 7, 2025, before the apex court, based on which it set aside the provisional attachment order passed against Project Royal Rajvilas (RRV).

"..... Provisional Attachment Order... passed against the Corporate Debtor is partially set aside and the attached properties are directed to be restored to the Successful Resolution Applicant (SRA) who stepped into the shoes of the Corporate Debtor solely for the benefit of genuine and innocent home-buyers who subsequently acquired the attached units," said the Supreme Court.

Moreover, the apex court has also directed "the name of the Corporate Debtor ( Udaipur Entertainment World) shall be deleted from the array of accused" in the supplementary prosecution complaint filed by ED on February 27, 2025.

However, a two-member bench comprising Justice Sanjay Kumar and Alok Radhe also said this order is being passed without going into the merits and the rival contentions of the parties.

The apex court also said provisional attachment shall continue for 11 units in the RRV project, identified and referred to in the additional affidavit pursuant to payment of a total of Rs 7.82 crore, which are alleged to be connected with proceeds of crime.

The apex court order also said if "in the ongoing investigation by the DoE (Directorate of Enforcement) in the matter of the Syndicate Bank fraud under the provisions of the PMLA, if any amount(s) paid for any flats/units booked by the remaining home buyers is/are found to be connected with proceeds of crime," then the agency would be entitled to take appropriate steps against those home buyers.

The SC lauded the role of the ED in the case saying "...we place on record our appreciation for the efforts made by the learned counsel for the parties and the DoE (Directorate of Enforcement or ED) in restoring the attached properties to secure the interests of genuine and innocent home buyers." PTI KRH NES RT RT