HC grants relief for over 900 flat owners, stays attachment of Panvel housing complex

The Bombay High Court has stayed the attachment of a Panvel housing project, benefiting 900 flat owners defrauded by builder Lalit Tekchandani.

MUMBAI: In a reprieve for more than 900 flat owners, the Bombay high court last week stayed the attachment of a Panvel-based housing complex developed by builder Lalit Tekchandani, who is being investigated for alleged investor fraud under the Maharashtra Protection of Interests of Depositors (MPID) Act.

HC grants relief for over 900 flat owners, stays attachment of Panvel housing complex

The Enforcement Directorate had in in April attached the properties of Tekchandani and his firm, Supreme Developers and Construction Pvt Ltd (SDCPL), as part of its investigation. Tekchandani, who allegedly siphoned funds belonging to the flat owners, was arrested in March.

Fearful of losing their life savings, the Clan City Welfare Association, a group formed by 157 flat owners of the SDCPL project, filed a petition in the high court through advocate Himanshu Kode against the attachment. The petition asked for the project to be completed through a government agency or court-monitored committee. The residents’ association alleged that Tekchandani duped at least 1,700 flat owners and pocketed over ₹400 crore.

A bench comprising justices Ajey Gadkari and Kamal Khata passed a stay order on the attachment, noting that more than 900 gullible flat purchasers who hail from middle-income groups of society have been duped by the builder systematically and in a well-planned manner.

According to the petition, the Panvel-based project received its first commencement certificate in 2010. It added that the flat owners had taken loans and were paying interest to banks and financial institutions for the past 14 years without a hint of possession from the builder.

The petition claimed that the builder told the Real Estate Regulatory Authority that the project, consisting of 13 buildings, would be completed by March 2023, but only 70% of the work has been completed so far. It also alleged that SDCPL had taken booking amounts ranging from ₹32,000 to ₹53,000 from the flat purchasers, followed by some more money while issuing a letter of intent.

At a subsequent stage, the firm issued a letter of reservation that imposed onerous terms and conditions like termination of the owners’ rights over the prospective flats, the petition said. This forced the flat owners to pay further amounts to the firm without a hint of sale deeds for the flats, it added.

While passing a stay order on the attachment of the project, the court noted the plight of the flat owners, saying that they had paid “a substantial amount (in some cases full and in some to the extent of 90% of the total consideration) for their respective flats” to the developer, in most cases by availing loans. It added that although the owners are repaying their loan instalments, “their dream of having a roof on their head is totally shattered due to the alleged misdeeds” of SDCPL and its directors.