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'Big bull' Harshad Mehta's flats up for sale

Sidhartha  |  Mumbai 

Sixteen years after the stock market scam orchestrated by Harshad S Mehta, the custodian has put up eight apartments in a complex called Madhuli, which is occupied by his family in upscale Worli, for sale.

The custodian, appointed under the special law to deal with cases related to the 1992 scam, has called for bids by February 4. The Mehta family owned nine apartments in the Madhuli Housing Cooperative Society, but one of them (flat number 31), which belongs to Rasila S Mehta, the stock broker’s mother, is not up for sale.

Harshad Mehta’s family consists of four brothers, their wives, children and his mother. The nine flats were merged and redesigned to accommodate the joint family.

Madhuli was among the most prized possessions of Harshad Mehta, who had come to be known as the Big Bull, and is said to have included a billiards room, a mini theatre and a mini golf course.

When Business Standard visited some of the apartments on the third floor this afternoon, the billiards table was in the main hall, covered with dust and a cloth. The sofas looked worn out and the paint was peeling from the wall. Some domestic helps were busy cleaning the apartments.

The guards at the entrance, who wanted to know if we had come from a bank, said that the intercom connections to the two floors occupied by the Mehtas were not working.

When contacted on his mobile phone, Sudhir S Mehta, who is part-owner of an apartment on the fourth floor, said: “My brother (Ashwin S Mehta) deals with the issue.” He, however, did not provide any contact details, saying he was in a meeting.

Owners of the eight apartments that are to be auctioned owe over Rs 1.5 crore to the Madhuli Cooperative Society, according to information made available by the custodian.

While the custodian has been selling off the shares and properties of Harshad Mehta, his family members and other notified parties, Madhuli has been a bone of contention.

The Mehtas had managed to get a favourable verdict in the past arguing that the property was bought in 1990, much before the 1992 scam. In November, however, the Supreme Court approved the sale.

Dismissing a petition filed by Jyoti H Mehta, Harshad’s wife, the court said, “…as all these residential properties have been funded by Harshad S Mehta, they can be considered to be properties of Harshad Mehta and disposed of accordingly.” Once the bids are received, the special court on the scam has to approve the sale, which will be followed by a stamp of approval from the Supreme Court, an official in the custodian’s office said.

Though no reserve price has been disclosed, another official said that the valuation had dropped owing to the general decline in property prices. Based on prevailing market prices in Worli, estimated by real estate consultants at upwards of Rs 35,000 per square foot, the custodian may be able to raise over Rs 44 crore by selling the eight apartments.

Proceeds from the sale will be used to clear the dues of the tax department, banks and other individuals. The tax department alone is claiming arrears of around Rs 10,000 crore from Harshad Mehta, a finance ministry official said. An official in the custodian’s office said so far only around 10 per cent of the dues have been cleared and an assessment on Mehta’s assets and liabilities is being conducted.

First Published: Thu, January 08 2009. 00:00 IST