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Informist, Tuesday, Apr. 29, 2025

 

NEW DELHI – The Supreme Court on Tuesday ordered the Central Bureau of Investigation to register preliminary enquiries into real estate projects launched by Supertech Ltd. and other builders to uncover nexus between banks or financial institutions and builders-cum-developers with respect to projects where homebuyers have paid substantial amounts and projects have not even been launched or construction has not begun. 

 

The probe agency will investigate projects by Supertech and the role of banks that have loaned over INR 50 billion under the subvention scheme for multiple housing projects in Delhi-National Capital Region, The agency will also probe the projects of other builders that fall outside the Delhi-National Capital Region. In addition, the agency will probe the role of government authorities- New Okhla Industrial Development Authority, Greater Noida Industrial Development Authority, Yamuna Expressway Industrial Authority and others.

 

For carrying out the probe, the Central Bureau of Investigation will form a special investigation team consisting of its officers and personnels from Uttar Pradesh and Haryana police as the majority of projects were from Delhi-National Capital Region. The directors general of police, who are the top-ranking police officers, of Uttar Pradesh and Haryana have also been asked to provide police officers to the CBI to aid in the investigation. 

 

The top court asked land development authorities, Ministry of Housing and Urban Affairs, Real Estate Regulatory Authority of Uttar Pradesh and Haryana, and the Reserve Bank of India to appoint nodal officers that will provide all the information sought by the probe agency and special investigation team. The Institute of Chartered Accountants of India will also provide services of three chartered accountants to help the special investigation team to probe the builder-bank nexus.

 

The apex court asked the Central Bureau of Investigation to submit an interim status report within a month. The court said it will monitor the case every month. Last month, the top court had observed, "Thousands of people are crying. We can't wipe their tears, but we can address their issues. Something very effective has to be done in a time-bound manner".

 

The apex court was hearing a batch of petitions by homebuyers about disbursement of funds by banks to builders-cum-developers through subvention schemes for various housing development projects in Noida, Greater Noida, Gurugram, and other nearby areas.

 

All the aggrieved homebuyers had purchased units in some or the other development projects launched by the builders-cum-developers. Through the subvention scheme, the builders-cum-developers advertised that they would pay the equated monthly installment or pre-EMI of the loans taken by the homebuyers to purchase the units in their development projects, till the specified cut-off taken or till the date of possession, depending on the terms of each tripartite agreement. In furtherance of these tripartite agreements, banks disbursed the majority of the loan amounts to the builders-cum-developers upfront.

 

In 2018 and 2019, when the builders-cum-developers defaulted on the required EMI or pre-EMI payments, banks began to demand payments from the homebuyers. It is pertinent to note that at the time of demanding payment from them, the homebuyers had still not received possession of their purchased units. In fact, the development projects were still under construction, incomplete, or had not even begun construction till then.

 

The petitioners have said almost 70-80% of the loan amounts were disbursed by the banks to the builders-cum-developers as 'first tranche', despite project milestones not being achieved. The banks and financial institutions had violated several provisions of the 2013 Reserve Bank of India guidelines when disbursing the amounts as the disbursal was done without any form of due diligence on behalf of the banks, said the petitioners.  End

 

Reported by Surya Tripathi

Edited by Deepshikha Bhardwaj

 

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