Distressed Homebuyers Accuse Ozone Group of Multi-Crore Real Estate Scandal
Thousands of homebuyers across India accuse Bengaluru-based Ozone Group of a massive real estate fraud spanning over a decade, affecting projects in Chennai, Bengaluru, and Mumbai.
Real Estate FraudOzone GroupHomebuyersKarnatakaReraReal EstateJul 10, 2025
At the heart of the accusations is a long-standing pattern: promising timely possession, collecting large sums from homebuyers and banks, and then abandoning projects mid-way. In Chennai, one of the earliest projects—The Metrozone in Anna Nagar—launched in 2008, remains incomplete. In 2016, two new towers were introduced under a subvention scheme, adding to the chaos, as banks reportedly disbursed loans in buyers’ names directly to the developer without proper sale agreements. Buyers, who were assured that the builder would bear the equated monthly instalments (EMIs) until possession, are now being hounded by banks for repayment. Several complainants allege that their credit scores have been ruined and they have been pushed into legal quagmires they never anticipated.
Buyers claim that tripartite agreements, which were supposed to safeguard their interests, were rendered meaningless as banks ignored due diligence and funds were released without registered construction or sale deeds. This has sparked fears of institutional collusion. Some affected families say they are not just victims of a rogue developer but of a compromised system.
The situation in Bengaluru is equally grim. At Ozone Urbana in North Bengaluru, multiple buyers have claimed that the same apartment was sold to different individuals. Despite favourable court orders, the developer has reportedly failed to comply, adding to the buyers’ woes. In a shocking turn, many complainants believe that government authorities are reluctant to act, possibly to protect vested interests.
A recent first information report (FIR) filed by the Resident Welfare Association of Ozone Urbana pegs the alleged fraud at Rs3,300 crore. Of this, Rs1,500 crore was reportedly raised as mortgage loans in buyers’ names — without their knowledge — while Rs1,800 crore was directly collected from them. The FIR states that only 49% of the construction has been completed, even though the project began in 2012 with an original delivery timeline of 2017.
The central crime branch (CCB) has also filed a case against Ozone Urbana Infra Developers Pvt Ltd and unnamed officials of private banks for criminal conspiracy, cheating, and breach of trust. The company is also under the scanner of the central bureau of investigation (CBI), although buyers claim that enforcement remains slow and ineffective.
The Karnataka real estate regulatory authority (KRERA) has repeatedly pulled up the company for non-compliance with refund orders. In February 2025, KRERA went a step further by invoking the legal doctrine of lifting the corporate veil to hold seven directors personally accountable. The authority noted that despite over Rs170 crore in outstanding dues to buyers, the company had no assets in its name to recover funds, compelling revenue officials to target directors’ personal properties. However, even these auction notices were quashed by the high court (HC), prompting KRERA to bring the directors directly into legal proceedings.
Frustrated by inaction, many buyers — especially senior citizens — have begun withdrawing their cases from KRERA. According to a report from Hindustan Times (HT), in March 2025, seven such cases were formally withdrawn, with buyers citing the authority’s failure to enforce its own orders. Many have now turned to the Karnataka HC, the national company law tribunal (NCLT), or even the National Human Rights Commission (NHRC) in a desperate search for justice.
A particularly heart-wrenching example, cited by the newspaper, is that of 78-year-old Dipak Chaudhary, who invested his retirement funds into an apartment at Ozone Urbana. Diagnosed with Parkinson’s, Mr Chaudhary is now bedridden while his wife continues the legal fight. “We don’t want to burden our children with this. We’ve already booked a new flat with another builder, but we are still waiting for the money we rightfully deserve,” she told HT.
Buyers say the government must act swiftly to prevent such fraud from becoming a blueprint for other developers. They have submitted complaints and petitions to the prime minister’s office (PMO), the chief minister’s office (CMO), and local officials. In one Chennai case, land meant for a tower was attached for recovery, but authorities have reportedly stalled its auction for years.
Legal experts and advocates have also flagged significant flaws in the current real estate grievance redressal framework. They argue that RERA bodies across states, including KRERA, lack enforcement teeth. While orders are passed, revenue officials are often too overburdened to follow up, and developers exploit legal loopholes to delay or avoid payments.
To address this, lawyers recommend appointing judicial members within RERA bodies and creating special enforcement officers to monitor and execute orders. They also call for periodic physical inspections and freezing of developer escrow accounts if there are pending legal obligations.
Meanwhile, more than 1,800 buyers in Bengaluru alone continue to wait—some for over a decade—for either their flats or their money. The Ozone group case, though striking on its own, is being seen as a warning sign of systemic rot. With refund liabilities across Karnataka builders rising to over Rs486 crore and recovery rates abysmally low, experts say a regulatory overhaul is urgently needed. Failure to act decisively now could embolden other rogue developers, leaving countless more citizens in similar distress.
Moneylife sent an email to the senior officials of the Ozone group. Till writing this story, we have not received any reply from them. We will update this article as and when we receive any response from the Ozone group.
Frequently Asked Questions
What is the main allegation against Ozone Group?
The main allegation against Ozone Group is a multi-crore real estate fraud spanning over a decade, involving the abandonment of projects, misappropriation of funds, and selling the same apartment to different buyers.
How has the government responded to the allegations?
The Karnataka real estate regulatory authority (KRERA) has taken steps, including invoking the legal doctrine of lifting the corporate veil to hold directors personally accountable, but enforcement has been slow and ineffective.
What are the legal actions taken by affected homebuyers?
Many homebuyers have filed cases with KRERA, the Karnataka HC, the national company law tribunal (NCLT), and the National Human Rights Commission (NHRC) to seek justice and recover their investments.
What are the recommendations to prevent such frauds in the future?
Legal experts recommend appointing judicial members within RERA bodies, creating special enforcement officers, and implementing periodic physical inspections and freezing of developer escrow accounts.
What is the current status of the Ozone Group's response to the allegations?
As of the last update, Ozone Group has not responded to the allegations. Moneylife has sent an email to senior officials of the Ozone Group, and the article will be updated with any response.
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