Real estate firm DB Realty today said its township project in Pune has been cancelled by a local development authority, an action the company has termed as arbitrary and illegal.
The eco-friendly township project at Bhosari, Pune, was awarded to the company in August, 2009, by the Pimpri Chinchwad New Town Development Authority (PCNTDA) and the same was to be developed through a joint venture, DB Realty said in a filing to the Bombay Stock Exchange (BSE).
On June 10, PCNTDA informed the JV that "the bidding process for the selection of a developer stands annulled and hence, letter of allotment (LOA) dated August 25, 2009, issued in the name of JV stands cancelled and has refunded the upfront deposits," it added.
The company said the cancellation of the project after a period of 22 months is "arbitrary and illegal and (it) has recorded its protest against the cancellation".
DB Realty said it would challenge the cancellation decision of the PCNTDA and is currently seeking legal advice for taking the necessary steps.
The company's promoters, Shahid Balwa and Vinod Goenka, are currently under the government's scanner for their involvement in the 2G telecom scam. With the investigation into the high-profile case going on, both are at present lodged in jail.
Earlier, in May, the company said it had appointed K M Goenka, the father of Vinod Goenka, as the Non-Executive Chairman of its board of directors and also inducted three independent directors.
Shares of the company were trading 1.76% down at Rs 81.15 a piece in the afternoon on the BSE.
