NEW DELHI: On Tuesday, the Supreme Court permitted the CBI to file 22 cases regarding the “unholy nexus” between banks and developers accused of deceiving homebuyers in the NCR.
A bench led by Justices Surya Kant and N. Kotiswar Singh authorized the CBI to transition six preliminary inquiries against various builders and banks into 22 formal cases, similar to FIRs, for further investigation.
Entities under scrutiny include builders in NCR and development authorities in Uttar Pradesh and Haryana.
According to the subvention scheme, banks disburse approved amounts directly to builders, who must pay EMIs on these loans until they deliver flats to homebuyers. However, as builders began to default on their EMIs, banks sought payments from homebuyers in accordance with the tripartite agreement.
The bench praised the central probe agency for recognizing the serious nature of the issue by interviewing over 1,000 people and inspecting 58 project sites. They urged a swift conclusion to the investigation and to reach a logical resolution.
The Supreme Court noted that the seventh inquiry by the CBI, which involves various builders’ projects outside the NCR region (Mumbai, Bangalore, Kolkata, Mohali, and Allahabad), is still ongoing.
This hearing is part of a series of petitions submitted by more than 1,200 homebuyers who opted for flats under subvention schemes in various housing projects across the NCR, particularly in Noida, Greater Noida, and Gurugram, claiming they are being forced by banks to pay EMIs despite not possessing their flats.
On March 29, the Supreme Court had already allowed the CBI to initiate five preliminary inquiries into builders and projects in the NCR, covering areas like Noida, Greater Noida, Gurugram, Yamuna Expressway, and Ghaziabad.
The court also permitted one inquiry against Supertech Ltd, which has faced 799 appeals from homebuyers regarding projects spread over eight cities.
On Tuesday, the bench reviewed a sealed report from the CBI, revealing that after initial inquiries, the registration of 22 formal cases was deemed necessary for further investigation.
“We accept the recommendation; the CBI is authorized to register regular cases and proceed as per the law,” the bench ruled, allowing the CBI to seek further court directions.
The bench allocated six weeks for the agency to investigate the seventh preliminary inquiry concerning projects beyond the NCR.
The court instructed Additional Solicitor General Aiswarya Bhati, representing the CBI, to share relevant sections of the sealed report with amicus curiae advocate Rajiv Jain as needed.
The CBI was also directed to review the amicus’ report, which emphasizes the need for transparency in the dealings of development authorities, including RERA, and suggests protective measures for homebuyers against dishonest builders.
Referring to the amicus’ findings, the bench noted that while a few homebuyers were offered possession of their flats, they opted for litigation instead.
“We will not entertain these few homebuyers if they misuse the court system. They should pursue legal remedies through appropriate channels, not this court,” the bench stated.
The bench will reconvene in 10-15 days for further hearings.
On April 29, the court directed the CBI to initiate seven preliminary inquiries against builders in the NCR, including Supertech Limited.
The court condemned the collaboration among officials from development authorities, banks, and builders to swindle homebuyers, asserting a prima facie connection between notable banks and builders in NOIDA, Gurugram, Yamuna Expressway, Greater Noida, Mohali, Mumbai, Kolkata, and Allahabad.
Advocate Jain identified Supertech Ltd as the “main culprit” in the fraud against homebuyers, while Corporation Bank allegedly provided over Rs 2,700 crore to builders through subvention schemes.
The amicus curiae’s report disclosed that Supertech Ltd had obtained a loan amounting to Rs 5,157.86 crore since 1998.
