Supreme Court Approves CBI to Investigate Six More Real Estate Fraud Cases
The Supreme Court has granted the CBI permission to register six additional cases involving the alleged nexus between banks and real estate developers across multiple cities, including Mumbai, Bengaluru, and Kolkata. The cases focus on the misuse of homebuyers' funds and the failure to deliver promised properties.
Real EstateCbiSupreme CourtHomebuyersFraudReal Estate MumbaiSep 23, 2025
A three-judge bench of Justices Surya Kant, Ujjal Bhuyan, and N. Kotiswar Singh allowed the agency to proceed after Additional Solicitor General Aishwarya Bhati, appearing for the CBI, said preliminary inquiries in these projects (except Supertech Ltd) had been completed.
The bench recorded the CBI’s submission that cognisable offences had been found and authorised the agency to proceed with registering regular cases, including search and seizure operations. The court also directed Bhati to share portions of the sealed cover report with amicus curiae Rajiv Jain.
Earlier, on July 22, the apex court had allowed the CBI to register 22 cases against builders and development authorities in Delhi-NCR, granting six weeks to complete inquiries into projects outside NCR. These cases involve allegations that banks, under the subvention scheme, disbursed loan amounts directly to builders, who later defaulted on EMIs, forcing banks to recover dues from homebuyers despite flats not being delivered.
Over 1,200 homebuyers, mainly from Noida, Greater Noida, and Gurugram, have petitioned the court, alleging collusion between banks, builders, and development authorities. The amicus curiae termed Supertech Ltd the “main culprit,” noting that it alone had availed loans worth ₹5,157.86 crore since 1998, while Corporation Bank extended more than ₹2,700 crore to various builders through subvention schemes.
The Supreme Court expressed concern over the prima facie nexus between reputed banks and developers across Noida, Gurugram, Greater Noida, Yamuna Expressway, Mohali, Mumbai, Kolkata, and Prayagraj. The court’s decision to allow the CBI to investigate these cases is a significant step towards ensuring transparency and accountability in the real estate sector, where homebuyers have often been left in the lurch due to the alleged fraudulent practices of developers and financial institutions.
Frequently Asked Questions
What is the 'unholy nexus' mentioned in the cases?
The 'unholy nexus' refers to the alleged collusion between banks and real estate developers, where banks disbursed loan amounts directly to developers, who then defaulted on EMIs, leaving homebuyers to bear the financial burden.
Which cities are affected by these real estate fraud cases?
The cases involve real estate projects in Mumbai, Bengaluru, Kolkata, Prayagraj, and Mohali, as well as areas in Noida, Greater Noida, and Gurugram.
What is the subvention scheme mentioned in the article?
The subvention scheme is a financial arrangement where banks provide loans to homebuyers, but the loan amounts are disbursed directly to the builders. This scheme often results in builders defaulting on EMIs, while homebuyers are left to repay the loans without receiving the promised properties.
How many cases have been registered by the CBI so far?
The CBI has been permitted to register 22 cases against builders and development authorities in Delhi-NCR, and an additional six cases in other cities, bringing the total to 28 cases.
What role does the Supreme Court play in these investigations?
The Supreme Court has authorized the CBI to register and investigate these cases, ensuring that the agency can take appropriate legal actions, including search and seizure operations, to uncover the alleged fraudulent practices.
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