In a significant move on the ongoing builder-bank nexus case in the National Capital Region (NCR), the Supreme Court has allowed the Central Bureau of Investigation (CBI) to register 22 regular cases for further investigation. This decision follows the submission of the agency's interim report, which unveiled systemic irregularities involving banks, builders, and harassment faced by homebuyers.
While examining the report, a bench comprising Justice Surya Kant and Justice N. Kotiswar Singh acknowledged issues in the Gurugram courts, particularly about coercive orders passed against homebuyers despite a previous stay order. The Court directed the District and Sessions Judge, Gurugram, to conduct a fact-finding inquiry and submit a report within 10 days.
“This is a serious matter,” remarked Justice Surya Kant, stressing the gravity of the situation.
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The bench appreciated the CBI’s effort in investigating six preliminary inquiries and granted six more weeks to complete pending ones related to projects outside NCR. The court emphasized that CBI is at liberty to approach it for any logistical support if needed during further probe.
“We appreciate the outstanding efforts made by CBI... More than 1000 persons examined, 58 project sites visited, and voluminous records analyzed,” said the Court.
The bench reviewed a detailed note submitted by Amicus Curiae Rajeev Jain, which was described as an “eye-opener” and directed it be shared with Additional Solicitor General (ASG) Aishwarya Bhati. The Court also asked that relevant parts of the interim report be shared with the Amicus Curiae.
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Interestingly, the CBI report also found some homebuyers acting in bad faith, using litigation as a means to delay payments. The Court clarified that such homebuyers will not be allowed to misuse writ jurisdiction and must seek relief through proper legal channels.
Another key issue brought to the Court’s attention was an allegation against Indiabulls Housing Finance Ltd. (now Sammaan Capital). Senior Advocate Mukul Rohatgi, representing the company, denied using any rogue elements for recovery and clarified that only company officials had visited the homebuyer’s premises. The Court took note of this clarification and exempted further personal appearances of the company’s Managing Director.
The bench was further informed that non-bailable and bailable warrants were being issued against some homebuyers by Gurugram courts. This prompted the Court to remark:
“There's a problem with our courts also in Gurugram, I'm getting a lot of information,” observed Justice Kant, initiating the direction for a judicial inquiry.
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Background of the Case:
The case stems from petitions filed by homebuyers in NCR who alleged that despite delays in possession by builders, banks were still forcing them to pay EMIs under subvention schemes. Under such schemes, banks allegedly released funds directly to builders/developers in violation of RBI norms, using the homebuyers as a medium.
In July 2023, the Court granted interim protection to homebuyers from coercive actions including those under Section 138 of the Negotiable Instruments Act (cheque bounce cases).
Later in March 2024, seeing non-cooperation from builders and banks in furnishing project details, the Court sought a CBI proposal for a detailed probe. By April, preliminary enquiries were ordered—Supertech Ltd. being given top priority due to its massive involvement in over 21 projects across 6 cities, with loans worth ₹5,157.86 crores and about 800 aggrieved homebuyers.
The bench had noted the case raises “issues of systemic failure by statutory authorities, regulatory bypass by banks, and illicit gains by builders—at the cost of ordinary homebuyers.”
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- Senior Advocate Sanjeev Sen appeared for HDFC Bank
- ASG Aishwarya Bhati appeared for the CBI
- Advocates Anshul Gupta, Aditya Parolia, Piyush Singh, and Eshna Kumar represented homebuyers
Case Title:
Himanshu Singh & Ors. v. Union of India & Ors., SLP(C) No. 7649/2023 and connected matters
Appearance: Senior Advocate Sanjeev Sen (for HDFC Bank); ASG Aishwarya Bhati (for CBI); Advocates Anshul Gupta, Aditya Parolia, Piyush Singh and Eshna Kumar (for homebuyers)