In Mumbai, real estate is a significant industry and a vast market. Alongside this growth, real estate-related crimes are also on the rise in the city. Numerous builders, including prominent developers, have been involved in deceiving people. Almost every police station reports cases related to cheating by developers every few days. Many people have lost their lifelong savings in real estate scams.
Recently, developer Lalit Tekchandani was arrested on January 30 by the Mumbai police's Economic Offences Wing (EOW) in connection with a housing fraud case. The complainant had invested ₹36 lakh in Tekchandani's construction project in Taloja, Navi Mumbai, where construction stalled a year before its 2017 deadline. In another incident, developer Jayesh Vinod Tanna was recently arrested by EOW for allegedly duping 27 flat buyers of ₹40 crore in a Goregaon-based project. Another case related to Ahuja builders, around a two-decade-old housing and investment scam allegedly perpetrated by Ahuja Builders.
Advocate Prakkash Rohira, representing homebuyers in the High Court, claims that the father-son duo, Jagdish and Gautam Ahuja (Ahuja builders), cheated over 2,000 homebuyers. While Jagdish Ahuja was arrested, Gautam remains on the run without police efforts to secure his custody. Apart from these, multiple developers have been cheating people under the name of selling homes.
Developers allegedly engaging in fraudulent practices
There have been growing concerns about developers allegedly engaging in fraudulent practices across Mumbai city, leaving customers disheartened and financially strained. Some developers have been accused of employing misleading marketing strategies, such as showcasing amenities and features that do not align with the actual offerings. This has led to customers investing in properties based on false representations.
Cases revealed instances where developers have manipulated property prices, either inflating them beyond market standards or initially offering lower prices only to raise them later in the transaction process. Delays in project completion have been a prevalent issue, causing financial distress for buyers who had planned their investments around specific timeline. Some developers have allegedly breached agreed-upon delivery dates without adequate explanations or compensation.
Developers accused of compromising on construction quality
There have been cases where developers are accused of compromising on construction quality, using substandard materials or cutting corners to maximise their profits. This poses serious risks to the safety and longevity of the constructed properties.
Certain developers have faced criticism for maintaining a lack of transparent transaction practices, making it difficult for customers to understand the complete financial implications of their investments. Hidden charges often come as unwelcome surprises, leaving buyers feeling cheated.
Affected customers take legal recourse
Several affected customers have taken legal recourse to address these issues, filing complaints with consumer forums and real estate regulatory authorities. Additionally, consumer advocacy groups have been actively raising awareness about these fraudulent practices and urging authorities to take stringent action against erring developers.
Raising a question on Maharashtra Real Estate Regulatory Authority, advocate Shirish Deshpande, chairman of Mumbai Grahak Panchayat, said: “The government seems to be falling short in preventing such crimes. The MahaRERA Act was implemented on May 1, 2017, to ensure transparency and accountability. Now, almost seven years after the enactment of the law, its implementation has not been impressive.”
He added, “Developers show little regard for the MahaRERA Act, submitting fake documents to MahaRERA to legalise their constructions and cheat people. The administration takes no action. Only dates are issued and in some cases, MahaRERA fails to issue dates. Some customers receive dates after a year, which is obviously profitable for the builders. RERA does not entertain complaints filed by customers.”
“More than seven thousand complaints have not been resolved by MahaRERA yet. The Consumer Forum has written a letter about this to the MahaRERA Chairman, but he has not replied. The number of complaints and stalled projects continues to increase. Builders are not taking the RERA Act seriously. The MahaRERA Act is strong, but the implementation is not being done properly,” Deshpande said.
Harish Kumar Jain, president of the Brihanmumbai Developers Association, stated, “When any complaint reaches our association, our committee scrutinises it and then decides whether to inform MahaRERA or resolve it internally.”
“The Association appeals to developers to adhere to norms, contributing to an enhanced image for the real estate sector, particularly with the confidence boost among customers. In comparison to the past, the occurrence of cheating cases has significantly reduced, and now, it is rare to find even 10% of such cases,” Jain added.
