One of my clients recently had a case which I am explaining below and if you are stuck in such similar situation, here is what to do.

Note: Due to attorney-client privilege, I cannot disclose complete case details or identify the actual parties involved. However, I am sharing the essential facts and legal approach so that if you find yourself in a similar situation, you can understand the available solutions and legal remedies.

Mr. X approached me regarding his investment of over Rs. 4 crores in a commercial unit at XYZ Commercial Complex in City A, Area X. The project, valued at over Rs. 200 crores, has affected hundreds of investors. X.builder collected substantial amounts from multiple investors but the project remains stalled for years. The City Development Authority has been investigating the matter, but investors are left in limbo with their life savings stuck. Mr. X, like many others, took loans against his property to invest in this project, expecting completion within the promised timeline. The builder has been unresponsive and has allegedly diverted funds meant for construction to other ventures, leaving investors without their units or refunds.

Advice in Such Cases

Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation to come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

• Document all communications, receipts, and agreements with the builder immediately
• Form an association with other affected investors to strengthen your legal position
• File complaints with RERA and consumer forums simultaneously for faster resolution

Applicable Sections of Law

Under the Bharatiya Nyaya Sanhita (BNS), several sections apply to builder fraud cases. Section 316 deals with criminal breach of trust, Section 318 covers cheating, and Section 61 addresses criminal conspiracy when multiple parties are involved. Under the Bharatiya Nagarik Suraksha Sanhita (BNSS), Section 173 governs the investigation process while Section 200 deals with complaint procedures. RERA provisions also apply for delayed or stalled projects, providing additional remedies for aggrieved homebuyers and investors.

If You Are the Complainant

• File an FIR under BNS sections for criminal breach of trust and cheating
• Lodge a complaint with RERA for delayed possession and seek compensation
• Approach consumer forums for deficiency in services and unfair trade practices
• Maintain detailed records of all payments made and communications with the builder
• Coordinate with other investors to file joint complaints for stronger impact

If You Are the Victim

• Preserve all original documents, agreements, receipts, and bank transaction records
• Contact other affected investors to understand the scope of the fraud
• Report the matter to economic offences wing if the amount involved is substantial
• Seek interim relief through courts to prevent further asset disposal by the builder
• Consider filing for insolvency proceedings against the builder company if applicable

How the Police Behave in Such Cases

Police typically treat builder fraud cases seriously, especially when large amounts are involved. They usually register FIRs under economic offences and may transfer cases to specialized wings. However, investigation can be slow due to complexity and multiple victims. Police often require substantial documentation and may seek expert opinions on construction and financial matters. Coordination between different jurisdictions may be needed if the builder operates in multiple states.

FAQs People Normally Have

Can I get my money back? Yes, through RERA tribunals, consumer forums, or criminal proceedings, though recovery timeline varies.

Should I file civil or criminal case? Both simultaneously – criminal for fraud and civil for monetary recovery.

What if the builder declares bankruptcy? You can still pursue personal liability of directors and seek attachment of personal assets.

How long will the case take? RERA cases typically resolve within 1-2 years, while criminal cases may take longer.

What Evidence Is Required?

• Sale agreement or booking documents with the builder
• Payment receipts, bank statements, and transaction records
• Project brochures, advertisements, and promotional materials
• Correspondence with builder including emails, letters, and messages
• RERA registration certificate and project details
• Photographs or videos of the project site showing construction status
• Witness statements from other affected investors

How Long Will the Investigation Take?

Investigation timelines vary based on case complexity. RERA cases typically conclude within 12-24 months. Police investigation for criminal aspects may take 6-18 months depending on evidence collection and builder cooperation. Consumer forum cases usually resolve within 12-18 months. Parallel proceedings in multiple forums can expedite overall resolution and increase chances of recovery.

Advocate Sudhir Rao, Supreme Court of India