SC Allows CBI to Register Six More Real Estate Fraud Cases in Delhi-NCR and Beyond
The Supreme Court has allowed the CBI to register six more regular cases into the 'unholy nexus' between banks and developers, which has defrauded homebuyers in real estate projects across various cities including Mumbai, Bengaluru, Kolkata, Mohali, and Prayagraj.
Real EstateFraudCbiSupreme CourtHomebuyersReal EstateSep 23, 2025
A bench of Justices Surya Kant, Ujjal Bhuyan, and N Kotiswar Singh permitted the CBI to proceed as per law following a submission by Additional Solicitor General Aishwarya Bhati. Bhati, representing the agency, mentioned that the CBI has completed preliminary inquiries in projects of various builders, except Supertech Ltd, which falls outside the Delhi-NCR region.
The bench noted the CBI's submission that, after the preliminary inquiry, a cognizable offense had been identified. The court allowed the agency to register regular cases and proceed according to the law. Bhati also stated that the agency is willing to register six regular cases to expedite the investigation and conduct searches and seizures.
On July 22, the Supreme Court had previously allowed the CBI to register 22 cases to investigate the 'unholy nexus' between banks and developers in the National Capital Region (NCR). The court had granted the CBI six weeks to complete the preliminary inquiry for projects outside the NCR. The 22 cases pertained to builders operating in NCR and development authorities in Uttar Pradesh and Haryana.
Under the subvention scheme, banks disburse the sanctioned amount directly to the accounts of builders, who are then required to pay EMIs on the sanctioned loan amount until flats are handed over to homebuyers. However, after builders started defaulting on EMIs to banks, the banks, in line with the tripartite agreement, began demanding EMIs from homebuyers.
The Supreme Court is currently hearing a batch of petitions filed by over 1,200 homebuyers who booked flats under the subvention plans in various housing projects in NCR, particularly in Noida, Greater Noida, and Gurugram. These homebuyers allege they are being forced by banks to pay EMIs despite not having received possession of their flats.
On March 29, the Supreme Court allowed the CBI to register five preliminary inquiries into the affairs of builders and projects in Noida, Greater Noida, Gurugram, Yamuna Expressway, and Ghaziabad. The court also permitted one preliminary inquiry to be registered against realty major Supertech Ltd, against whom 799 homebuyers have moved the top court through 84 appeals involving projects in eight different cities.
On July 22, the Supreme Court reviewed the report submitted by the CBI in a sealed cover, which suggested that after conducting preliminary inquiries, 22 regular cases needed to be registered for further investigation. On April 29, the court directed the CBI to register seven preliminary inquiries against builders in NCR, including Supertech Limited.
The Supreme Court has expressed strong disapproval of the collusion between development authorities, banks, and builders to defraud homebuyers. The court found a prima facie nexus between renowned banks and builders in Noida, Gurugram, Yamuna Expressway, Greater Noida, Mohali, Mumbai, Kolkata, and Prayagraj. The amicus curiae, in its report, identified Supertech Ltd as the 'main culprit' in defrauding homebuyers and noted that Corporation Bank had advanced more than Rs 2,700 crore to builders through subvention schemes. The report also revealed that Supertech Ltd alone had secured a loan amount of Rs 5,157.86 crore since 1998.
This decision by the Supreme Court to allow the CBI to register additional cases is a significant step towards ensuring accountability and justice for homebuyers who have been affected by the fraudulent practices of builders and financial institutions.
Frequently Asked Questions
What is the 'unholy nexus' mentioned in the article?
The 'unholy nexus' refers to the collusive relationship between banks and real estate developers, which has been used to defraud homebuyers in various real estate projects across India.
What is the subvention scheme in real estate?
The subvention scheme is a financial arrangement where banks disburse the sanctioned loan amount directly to the accounts of builders. The builders are then required to pay EMIs on the loan until the flats are handed over to homebuyers.
Why did the Supreme Court allow the CBI to register more cases?
The Supreme Court allowed the CBI to register more cases to investigate the fraudulent practices of banks and developers who have been defrauding homebuyers. This is part of a broader effort to ensure accountability and justice for the affected homebuyers.
What is the role of the amicus curiae in this case?
The amicus curiae, or 'friend of the court,' provides independent advice to the court on the legal issues involved. In this case, the amicus curiae has highlighted the fraudulent activities of builders and banks and identified Supertech Ltd as a major culprit.
What is the significance of the CBI's preliminary inquiries?
The CBI's preliminary inquiries are crucial in determining whether a cognizable offense has been committed. If the preliminary inquiry finds evidence of a cognizable offense, the CBI can register a regular case and proceed with further investigation.
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