Case studies showed examples of developers manipulating real estate values by either undervaluing properties at first or inflating them above market rates.
Real estate is a big business and a sizable market in Mumbai. In Mumbai, real estate is a significant industry and business. Real estate-related crimes are increasing in the city concurrently with this growth. Many builders, including well-known developers, have been implicated in deceiving individuals. Reports about cases involving dishonest developers arrive at almost every police station every few days. Every couple of days, all police stations report cases involving people who have been cheating. Real estate scams have cost many people their entire life savings.
Developer Lalit Tekchandani was recently taken into custody in a housing fraud case by the Mumbai police’s Economic Offenses Wing (EOW) on January 30. In Taloja, Navi Mumbai, the complainant invested Rs 36 lakh in Tekchandani’s construction project; however, a year before the project’s 2017 deadline, work ended abruptly. In a recent incident, an arrest took place by EOW of developer Jayesh Vinod Tanna on suspicion of defrauding 27 flat buyers out of Rs 40 crore in a Goregaon project. Another case, according to Ahuja Builders, involves a 20-year-old housing and investment scam.
The father-son team of Jagdish and Gautam Ahuja (Ahuja builders) allegedly defrauded over two thousand homebuyers, according to lawyer Prakkash Rohira, who represents homebuyers in the High Court. Jagdish Ahuja is in custody, but Gautam is still at large despite police efforts to apprehend him. Furthermore, several developers have tricks by feigning to sell homes.
Tax cheating developers
An increasing number of people in Mumbai City are worried that developers are involved in financial fraud, which is depressing and costly for the clients. Some developers have come under fire for allegedly using deceptive marketing techniques, like displaying features and amenities that do not match the products. Misleading representations have caused customers to invest in properties.
Case studies showed examples of developers manipulating real estate values by either inflating them above market values or by first offering lower prices and then raising them during the deal. Project completion delays have been a common problem, putting purchasers in financial jeopardy because they had budgeted their investments based on deadlines. Some developers have missed scheduled delivery dates without providing sufficient justification or payment.
Developers are accused of compromising construction quality
In certain instances, developers have faced allegations of sacrificing construction quality, utilizing inferior materials, or taking shortcuts to increase their earnings. It poses a threat to built properties’ longevity and security.
Developers may make it more difficult for investors’ clients to comprehend the big picture of finance if they follow the opaque transaction processes that have drawn criticism from some places. Because hidden costs are unpleasant surprises, buyers frequently perceive them as scams.
Affected clients file a lawsuit
To address these problems, several impacted clients have taken legal action, registering complaints with consumer forums and real estate regulatory bodies. Consumer advocacy organizations have also been actively educating the public about these dishonest practices and pressuring authorities to punish negligent developers harshly.
The chairman of Mumbai Grahak Panchayat, advocate Shirish Deshpande, asked a question about the Maharashtra Real Estate Regulatory Authority, stating that “the government seems to be falling short in preventing such crimes. “On May 1, 2017, the MahaRERA Act was signed into law to guarantee accountability and transparency.
He continues, saying, “Developers defame the MahaRERA Act by submitting fictitious documents to the agency to legitimize their projects and defraud the public. The government does nothing. MahaRERA only provides dates; occasionally, it does not provide dates. After a year, some customers receive dates, which is advantageous for the builders. RERA does not entertain complaints filed by customers.”
‘MahaRERA still isn’t solving over seven thousand complaints. The Consumer Forum sent a letter to the MahaRERA Chairman about this, but he has not replied yet. The number of complaints and stalled projects continues to increase. Builders aren’t taking the RERA Act seriously. Deshpande claims that despite the MahaRERA Act’s strength, its application is being done incorrectly.
“When any complaint reaches our association, our committee scrutinizes it and decides whether to inform MahaRERA or resolve it internally,” said Harish Kumar Jain, president of the Brihanmumbai Developers Association.
“The Association encourages developers to follow the rules, which will help the real estate industry’s reputation, especially since it will give consumers more confidence. Cheating cases are much less common now than in the past; Jain noted that it is uncommon to find even 10%of such cases.