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Informist, Thursday, Aug. 6, 2026

 

--SC: States to nominate police officers for CBI probe in real estate projects 

--CONTEXT: SC ordered CBI probe into builder-bk nexus in real estate projects 

--SC: SBI, bks to give sanction for prosecuting officers in real estate cases 

 

NEW DELHI – The Supreme Court Thursday asked the competent authorities of State Bank of India, UCO Bank, HDFC Bank, ICICI Bank, and Sammaan Capital Ltd. to expeditiously process and accord necessary sanctions for prosecution of their officers under the Prevention of Corruption Act, 1988, who have prima facie been found involved by the Central Bureau of Investigation in its probe. The Central Bureau of Investigation was probing the nexus between banks or financial institutions and builders-cum-developers with respect to real estate projects where homebuyers have paid substantial amounts and projects have not even been launched or construction has not begun. The banks will give the sanction in two weeks and on any failure they have to give an explanation, said the bench led by Chief Justice of India Surya Kant.

 

The top court asked the Director General of Police from Uttar Pradesh, Tamil Nadu, Maharashtra, Punjab and Karnataka to consider and provide additional police officers to the Central Bureau of Investigation on deputation for probing the nexus on real estate projects. The requisite officers shall be nominated as early as possible and not later in 10 days, said the court, adding that on delay of nomination, the court will take a serious view.

 

The Central Bureau of Investigation will inform the Enforcement Directorate about the details required to take cognisance for probing the nexus on real estate projects with respect to the proceeds of crime involved in the case, said the court. Further, the Central Bureau of Investigation will probe the allegations against Ozone Group in Karnataka, Rudra Buildwell Projects Pvt. Ltd., and Omaxe Group in Uttar Pradesh, it said. Status report in respect of the probe relating to the banks and financial institutions shall also be submitted by the CBI, said the court. The CBI shall also examine whether banks have consciously signed agreements to create mortgages in absence of lessees to whom land is leased, it said.

 

The top court noted that 50 first information reports have been registered currently on the issue. In these, it noted that the chargesheet has been filed in 17 cases and cognizance have been taken on 3 of those. In some of these cases, the role of financial institutions have been questioned, it said. Further, total 34 sanctions are awaited from banks to prosecute their officers, said the court.

 

The Central Bureau of Investigation probe was ordered by the Supreme Court in a case where it was hearing a batch of petitions from homebuyers about the disbursement of funds by banks to builders-cum-developers through subvention schemes for various housing development projects in the National Capital Region. Through the subvention scheme, the builders-cum-developers advertised that they would pay the equated monthly instalment (EMI) or pre-EMI on the loans taken by the homebuyers to purchase units in their development projects, until a specified cut-off date or date of possession, depending on the terms of each tripartite agreement. As per 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 EMI payments, banks demanded payments from the homebuyers. 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 disbursals were made without any due diligence on the banks' part, said the petitioners.  End

 

Reported by Surya Tripathi

Edited by Akul Nishant Akhoury

 

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