Supreme Court Greenlights CBI to Register Six More Cases Against Banks and Builders for Homebuyer Fraud
The Supreme Court has allowed the CBI to register six more cases against banks and real estate developers for defrauding homebuyers across multiple cities, including Mumbai, Bengaluru, Kolkata, Mohali, and Prayagraj.
Supreme Court Of IndiaDelhi Ncr HomebuyersBuilderbank NexusCbi ProbeReal Estate FraudReal EstateSep 23, 2025
The Bench, comprising Justices Surya Kant, Ujjal Bhuyan, and N. Kotiswar Singh, allowed the CBI to proceed with the registration of cases and conduct investigations as per the law. Additional Solicitor General Aishwarya Bhati, representing the CBI, informed the Court that the agency had completed preliminary inquiries into various builder projects outside the Delhi-NCR region.
The Court acknowledged the CBI's submission that preliminary inquiries revealed the commission of cognizable offenses, thus allowing the agency to move forward with formal case registration. Bhati also stated that the CBI was prepared to register six regular cases to expedite investigations and undertake searches and seizures where necessary.
The Court directed ASG Bhati to share portions of the sealed cover report with amicus curiae Advocate Rajiv Jain to facilitate further proceedings. This latest order follows the Court’s July 22 decision allowing the CBI to register 22 cases concerning the collusion between banks and developers in the Delhi-NCR region, particularly involving Noida, Greater Noida, Gurugram, and other parts of Uttar Pradesh and Haryana. In that order, the Court granted six weeks to complete preliminary inquiries for projects located outside the national capital region.
The fraud allegations stem from the subvention scheme, under which banks disbursed sanctioned amounts directly to builders. Builders were then obligated, under a tripartite agreement, to pay EMIs on these loans until flats were handed over to homebuyers. However, several builders reportedly defaulted on EMIs, prompting banks to demand payments directly from homebuyers despite non-possession of flats, effectively shifting the financial burden to unsuspecting buyers.
The Supreme Court is currently hearing petitions filed by more than 1,200 homebuyers across NCR who booked flats under subvention plans. These buyers alleged that banks and developers were forcing them to pay EMIs even when possession of flats had not been granted. Earlier, on March 29, the Apex Court had allowed the CBI to register five preliminary inquiries against builders and projects in Noida, Greater Noida, Gurugram, Yamuna Expressway, and Ghaziabad, including one preliminary inquiry against Supertech Ltd. Notably, 799 homebuyers have filed 84 separate appeals concerning Supertech’s projects across eight cities.
According to the amicus curiae’s report, Supertech Ltd has been identified as the “main culprit” in defrauding homebuyers, while Corporation Bank alone had advanced more than Rs 2,700 crore to builders under subvention schemes. Supertech Ltd, the report stated, secured a total loan amount of Rs 5,157.86 crore since 1998. The Supreme Court had previously expressed concern over a prima facie nexus between certain banks, builders, and officials from development authorities in cities including Noida, Gurugram, Yamuna Expressway, Greater Noida, Mohali, Mumbai, Kolkata, and Prayagraj. The CBI’s ongoing investigations aim to uncover the extent of collusion and hold the responsible parties accountable.
Frequently Asked Questions
What is the 'builder-bank nexus' case about?
The 'builder-bank nexus' case involves allegations of collusion between banks and real estate developers to defraud homebuyers. This collusion often involves subvention schemes where banks disburse loans directly to builders, who are then obligated to pay EMIs until flats are handed over to homebuyers. However, many builders default on these EMIs, leading to banks demanding payments from homebuyers despite non-possession of flats.
How many cases has the CBI been allowed to register?
The Supreme Court has allowed the CBI to register six additional regular cases in connection with the builder-bank nexus case. This follows an earlier decision allowing the CBI to register 22 cases concerning the collusion between banks and developers in the Delhi-NCR region.
Which cities are affected by this fraud?
The fraud allegations involve multiple cities, including Mumbai, Bengaluru, Kolkata, Mohali, and Prayagraj. The initial cases were concentrated in the Delhi-NCR region, particularly Noida, Greater Noida, Gurugram, and other parts of Uttar Pradesh and Haryana.
What is the subvention scheme and how does it work?
The subvention scheme is a financial arrangement where banks disburse sanctioned loan amounts directly to builders. Under a tripartite agreement, builders are obligated to pay EMIs on these loans until flats are handed over to homebuyers. However, many builders default on these EMIs, leading to banks demanding payments from homebuyers even before they receive possession of their flats.
What role is the Supreme Court playing in this case?
The Supreme Court is hearing petitions filed by homebuyers who have been affected by the builder-bank nexus. The Court has granted the CBI permission to register and investigate cases to uncover the extent of collusion and hold the responsible parties accountable. The Court is also monitoring the progress of these investigations and ensuring that the rights of homebuyers are protected.
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