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The Supreme Court has raised concerns over the progress of the investigation into the alleged nexus between real estate developers and financial institutions accused of cheating homebuyers. The court questioned the Central Bureau of Investigation for filing a chargesheet without custodial interrogation of the accused and cautioned that such a step could appear superficial. It directed the agency to conduct a proper and time-bound probe and submit a clear timeline for completion. The bench also rejected the suggestion of multiple state police investigations, stating that the case requires a unified approach due to the large number of affected homebuyers.
The Supreme Court of India has expressed concern over the manner in which the Central Bureau of Investigation (CBI) is handling the probe into the alleged nexus between certain real estate developers and financial institutions accused of cheating homebuyers. The court questioned the agency after it filed a chargesheet against some builders and officials linked to financial institutions without conducting custodial interrogation of the accused. Advertisement
A bench comprising Chief Justice Surya Kant, along with Justices Joymalya Bagchi and Vipul M Pancholi, observed that no individual should be treated as above the law. The judges indicated that the investigation must be completed within a defined timeframe so that the matter reaches a logical conclusion.
During the hearing, the bench noted that if builders had siphoned off funds collected from homebuyers, investigators should identify where the money had been diverted. The court suggested that arresting the accused developers could help investigators gather information about the movement of funds and help trace the money collected from buyers.
The court also expressed dissatisfaction with the progress of the probe so far. It observed that filing a chargesheet without custodial interrogation may give the impression that the investigation was not thorough. The bench indicated that the court expects the investigative agency to carry out a complete probe and not limit the process to procedural steps.
While presenting the government's position, Additional Solicitor General Aishwarya Bhati suggested that some of the cases could be examined by state police agencies. However, the Supreme Court rejected this suggestion and stated that allowing parallel investigations by different agencies would create confusion and complicate the process.
The bench further pointed out that if the state police were capable of handling these cases effectively, the matters would not have been transferred earlier to the Central Bureau of Investigation. The court stressed that once the investigation had been entrusted to the CBI, the agency must complete it properly and cannot step away from its responsibility.
Judges also highlighted that the matter involves a large number of homebuyers who have been waiting for relief for several years. The court observed that delays in the investigation only add to the hardship of buyers who had invested their savings in housing projects that remain incomplete or disputed.
To ensure progress in the matter, the Supreme Court directed the CBI to submit a clear timeline for completing the investigation. The bench asked a senior officer of the agency to file an affidavit detailing the current status of the probe and the steps that will be taken to move the investigation forward.
The court also stated that it cannot wait indefinitely for the investigation to conclude. The bench indicated that a time-bound probe is necessary so that accountability can be fixed and affected buyers can move closer to resolution.
In addition, the court instructed all stakeholders including homebuyers, banks and builders to submit their claims, suggestions and documents to the court-appointed amicus curiae Rajiv Jain. The amicus curiae has been asked to review these submissions and present relevant findings before the court.
The bench also directed the CBI to carefully examine the report earlier submitted by the amicus curiae, particularly the aspects that had already been identified for investigation. The court indicated that these observations could help the agency identify key areas that require deeper scrutiny.
The issue relates to a broader concern that has emerged in recent years regarding alleged collusion between some real estate developers and financial institutions. Several housing projects, particularly in parts of the National Capital Region, have faced delays or financial irregularities, leaving thousands of homebuyers waiting for possession of their homes despite having paid substantial amounts.
Over the past few years, the Supreme Court has repeatedly monitored cases involving stalled housing projects and financial disputes in the real estate sector. In several hearings, the court has emphasised the need for transparency in project financing and accountability among developers and lenders so that buyers are protected from financial losses.
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