Builder Fraud in Pune – Recovering Money After Cheques Bounce and Police Bias

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.

TL;DR: If a builder takes your money, sells the apartment to someone else, and gives you cheques that bounce, you have multiple remedies. File a criminal complaint for cheating under Section 318 BNS and cheque bounce under Section 143 of the Negotiable Instruments Act. Do not settle for less or sign documents you don't understand. A domain-expert lawyer can handle police bias and push for your rightful recovery.

Meet Rajesh, a software professional from Bengaluru. Back in 2019, he and his sister booked two apartments in a new project near Wakad, Pune. They paid a total of ₹20 lakh as advance — ₹10 lakh each. The builder, a man named Vikram Thakur, kept promising construction would start soon. It never did.

By 2022, Rajesh realised the builder had sold both apartments to other buyers. Construction was complete, and Vikram demanded more money. Rajesh tried everything — filed complaints with the Pune Commissioner's office, approached RERA (which rejected the case because the project was over 5250 sq ft), and sent dozens of letters to the CM Cell, NHRC, and local police. Nothing worked. The police summoned Vikram but only got him to issue three post-dated cheques of ₹5 lakh each — totalling ₹15 lakh. They never handed the cheques to Rajesh.

Then came a local lawyer who charged ₹70,000 and convinced Rajesh to sign a Tamil-language letter — a language he did not read. The letter supposedly accepted the ₹15 lakh "wholeheartedly" and closed all complaints. Worse, the lawyer then demanded another ₹2 lakh for an MOU. Rajesh left Pune, deposited the first cheque — it bounced. Vikram stopped payment on the others. Cheque bounce lawyers demanded ₹3 lakh to file a Section 138 case. Rajesh was stuck.

That's when he approached the Chamber of Advocate Sudhir Rao. Advocate Sudhir Rao and his office took a fresh look. They saw police bias, a builder who knew Rajesh was out of state, and a clear pattern of cheating. Here's the thing — they didn't settle. Instead, they filed a private criminal complaint under Section 175(3) BNSS and a cheque bounce case under the Negotiable Instruments Act. The court issued summons. Vikram, suddenly willing to negotiate, offered ₹10 lakh to hand over original documents. Rajesh refused. Advocate Sudhir Rao's domain expertise in builder fraud and cheque recovery helped secure a favourable settlement order — full ₹20 lakh plus interest. No more threats. No more delays.

Key Facts of the Case

• Rajesh and his sister paid ₹20 lakh as advance for two apartments in Pune in 2019-2020.
• The builder sold the apartments to third parties after construction in 2022, demanding more money.
• RERA rejected the complaint because the project size exceeded 5,250 sq ft.
• The police obtained three post-dated cheques of ₹5 lakh each but initially refused to hand them over.
• A local lawyer collected ₹70,000 and made Rajesh sign a Tamil-language letter accepting the ₹15 lakh and closing complaints.
• All cheques bounced — one dishonoured, others stopped by the builder.
• Multiple complaint cycles to CM Cell, police, and NHRC led to biased closures.
• Advocate Sudhir Rao's office filed criminal complaints under BNSS and a cheque bounce case, leading to full recovery of ₹20 lakh plus interest.

The Direct Legal Answer

Can I file a criminal case for cheating instead of a civil suit?

Yes. The builder's conduct — taking money, selling the property to someone else, and then issuing cheques that bounced — amounts to criminal breach of trust and cheating. You can file a private criminal complaint under Section 175(3) BNSS before a Magistrate if the police refuse to act. The advantage? Criminal cases can push for faster settlement and pressure the builder, unlike a civil suit which can drag for years.

Why does the builder want my original documents?

Here's the thing — your original agreement and receipts are your strongest evidence. If you hand them over, the builder can claim you settled or the deal never existed. Never part with originals. Courts rely on them. Handing them over weakens your case considerably.

Can I use social media to pressure the builder?

It worked partially here — the builder responded to Rajesh's Twitter and Instagram posts. But be careful. Posting aggressively can be used as harassment evidence against you. Use it only as a last resort, and preferably with your lawyer's advice. Focus on legal channels first.

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.

Do not sign papers you cannot read. Ever. Rajesh lost crucial time because of a Tamil letter he did not understand. Also, keep all originals — agreement, payment receipts, bounced cheques, legal notices. Your lawyer needs them. And finally, don't settle for a fraction of what you paid. The builder offered ₹10 lakh against ₹20 lakh — a clear loss. Stand firm.

This type of matter — builder fraud with cheque bounce and police bias — requires an advocate who regularly handles criminal complaints and NI Act cases. General practitioners often miss procedural nuances, like filing under Section 175(3) BNSS, which can turn the tide in your favour.

Applicable Sections of Law

• Section 318 BNS (Criminal Breach of Trust): Covers builders who dishonestly misappropriate funds paid for a specific purpose.
• Section 143 of the Negotiable Instruments Act, 1881: Governs cheque bounce cases — makes dishonour of cheques a criminal offence with imprisonment up to two years.
• Section 175(3) BNSS: Allows you to file a private criminal complaint before a Magistrate if the police refuse to register an FIR or act impartially.
• Section 528 BNSS: The High Court's inherent power to quash FIRs if the complaint is frivolous or an abuse of process — useful for accused parties, not for victims.

Punishment and Penalties

• Section 318 BNS (Criminal Breach of Trust): Imprisonment up to 5 years, fine, or both. Cognizable and non-bailable.
• Section 143 NI Act (Cheque Bounce): Imprisonment up to 2 years or fine up to twice the cheque amount, or both. Cognizable but bailable. The offence is compoundable — meaning you can settle out of court.
• Both offences are non-compoundable under BNS but the cheque bounce matter is compoundable under NI Act.

Jurisdiction — Where to File the Case

For cheque bounce cases, you file before the Magistrate's court where the cheque was presented and dishonoured. Typically, that is at the bank branch where you deposited the cheque — in this case, likely Pune. For the cheating complaint under BNS, file at the police station or Magistrate having territorial jurisdiction over where the builder's office or the property is located. Jurisdiction matters because the wrong court can dismiss your case outright. Your lawyer will confirm the correct forum.

What if Police Refuse to File FIR?

The police in Rajesh's case were biased and kept closing complaints. Here's what you can do:

• Approach the Superintendent of Police under Section 173(4) BNSS — formally complain about inaction.
• File a private criminal complaint before the Magistrate under Section 175(3) BNSS. The Magistrate can direct the police to investigate.
• As a last resort, file a writ petition in the High Court under Article 226 for a direction to register FIR.
• Do not rely on police alone — keep a written record of your complaints and their responses.

Rights of the Accused

• Right to remain silent: Article 20(3) — no one can be compelled to be a witness against themselves.
• Right to legal representation: Article 22 — every accused has the right to consult and be defended by a lawyer.
• Right to be produced before Magistrate: Within 24 hours of arrest (Article 22).
• Right to copy of FIR: The accused is entitled to a copy of the FIR and to know the grounds of arrest.
• Right to bail: For bailable offences, it's a matter of right. For non-bailable, it's at the court's discretion.

Bail Provisions

• Cheque bounce (Section 143 NI Act): Bailable. The accused gets bail on furnishing a bond, even without a lawyer in most cases.
• Cheating (Section 318 BNS): Non-bailable. The accused must apply for regular bail before the Magistrate or Sessions Court.
• Anticipatory bail (Section 482 BNSS): Available for non-bailable offences. The accused can apply pre-arrest to avoid custody.
• Bail conditions typically include a personal bond, surety, and undertaking not to tamper with evidence.
• Your lawyer must strategise — for victims, oppose bail if the builder is absconding. For accused, file anticipatory bail early.

Quashing of FIR / Case

• High Court power (Section 528 BNSS): The High Court can quash an FIR if it finds no prima facie case or if proceedings are an abuse of process.
• Grounds: No ingredients of offence, compromise with the victim, or if continuing would be a waste of court time.
• Strategy: For victims, don't easily agree to compromise unless full recovery happens. For accused, quashing is a viable option if the complaint is false or baseless.

If You Are the Victim

• Do not sign any document in a language you do not understand. Insist on Hindi, English, or your mother tongue.
• Keep originals of all agreements, receipts, and communications. Never hand them over unless ordered by a court.
• Contact a specialised lawyer immediately — one experienced in builder fraud and cheque bounce cases.
• Document everything: dates, amounts, police behaviour, email exchanges. This builds your case.
• Consider filing a private criminal complaint under Section 175(3) BNSS if police are biased.

Documents You Must Keep Ready

• Aadhaar card and PAN card for identity proof
• Apartment booking agreement / sale agreement (original)
• All payment receipts (bank transfers, cheques, cash receipts)
• Bounced cheques and the bank return memo
• Legal notices sent to the builder and their replies (if any)
• Police complaint copies and their closure reports
• RERA rejection order (if applicable)
• All email, WhatsApp, and social media communications with the builder

What Evidence Is Required?

• Primary evidence: Original agreement and payment receipts — the strongest proof of the transaction.
• Secondary evidence: Certified copies of the bounced cheques and bank statements showing dishonour.
• Documentary: Written correspondence (emails, legal notices, police complaints).
• Oral: Your own testimony and that of the sister who co-invested.
• Electronic: Social media posts, call recordings (if consensual), and screenshots of conversations.
• Police inaction can be shown through your complaints and their responses — keep a paper trail.
• Make no mistake: absence of original documents can cripple your case. Preserve them.

How the Police Behave in Such Cases

In builder fraud cases, police often treat it as a civil dispute — "go to civil court" is a common refrain. They may summon the builder, get a token settlement (like the three cheques here), and close the file. If you are out of state, they may be even less proactive. That's why you must push through superiors (SP) or go directly to the Magistrate. Police bias is real — document every interaction. A specialised lawyer knows how to handle this pressure and escalate when needed.

Timeline of Legal Process

• Private complaint under Section 175(3) BNSS: Filing to summons — 2 to 4 months. Police may be directed to investigate within 60 days.
• Cheque bounce case (Section 143 NI Act): Filing to summons — 1 to 3 months. Trial takes 6 to 12 months. Judgment and execution — another 6 months.
• Criminal trial for cheating (Section 318 BNS): Investigation + chargesheet — 3 to 6 months. Framing of charges — 2 to 3 months. Trial — 6 to 12 months. Judgment — 1 to 2 months. Appeal — 12 to 18 months.
• Settlement out of court: Can happen at any stage — often after summons are issued, the builder feels pressure and negotiates.
• Execution of decree for money recovery: If civil suit is filed, execution can take 6 to 12 months after judgment.

How Long Will the Investigation Take?

Under BNSS, police must complete investigation within 60 days for offences punishable with up to 10 years, and 90 days for more serious offences. For Section 318 BNS, the maximum is 90 days. If they delay, you can approach the Magistrate to direct investigation or take cognizance directly. Realistically, expect 3 to 6 months for a full investigation given typical police workload.

Understanding the Costs

The total cost of a matter like this varies significantly from one case to the next — it depends on the complexity of the dispute, the forum involved, the number of hearings, and the specific facts of your situation. There is no single fixed figure that applies to everyone.

A professional advocate can give you an accurate estimate only after reviewing all your facts and documents in a consultation.

Can the Matter Be Settled Out of Court?

Yes. Cheque bounce cases under the NI Act are compoundable — meaning you can settle with the builder at any stage. The court will record the compromise and acquit the accused. For the cheating case under Section 318 BNS, it is compoundable only if the parties agree and the court permits. In Rajesh's case, settlement happened after summons were issued — the builder paid the full amount plus interest. Settlement is advisable when you get your full money back. Do not settle for less because of desperation — you will lose the legal pressure needed to recover the balance.

Common Mistakes People Make

• Engaging a lawyer without domain experience: A general practitioner may not know how to handle police bias or file under Section 175(3) BNSS. Domain-specific experience with builder fraud and cheque bounce matters leads to faster, better outcomes.
• Signing documents you don't understand: Rajesh signed a Tamil letter without reading it — that nearly closed his case. Always have your lawyer review any document before signing.
• Handing over original documents: Never give originals to the builder or police unless a court orders it. They are your strongest evidence.
• Delaying legal action: Waiting years to file complaints weakens your case. Limitation for cheque bounce is 30 days from the return memo, and for cheating, it's 3 years from the offence.
• Posting aggressively on social media: It can pressure the builder, but it also gives them evidence to claim defamation. Use it carefully and under legal advice.
• Settling for less out of frustration: Accepting ₹10 lakh against ₹20 lakh is a loss. Hold out for full recovery with court backing.

FAQs People Normally Have

Can I file a case from another city if the builder is in Pune?

Yes. For cheque bounce, the case is filed where the cheque was presented — that is your bank branch in your city. For cheating, file where the builder operates or property is located. A lawyer can represent you remotely in many cases.

What if the builder keeps delaying by returning the same cheques?

File a complaint under Section 143 NI Act for each dishonoured cheque. The builder cannot stop you from pursuing criminal action. The court will take note of the repeated dishonour.

How long does a cheque bounce case take?

Typically 6 to 18 months from filing to judgment. But if the builder settles after summons, it can resolve within 3 to 6 months. The aim is to pressure the builder early.

Can I recover more than my original payment?

Yes. Under the NI Act, you can claim the cheque amount plus interest (usually 9-18% per annum) and costs. In criminal cases, the court may order compensation beyond the cheque amount in egregious cases.

Is it worth going to court when the amount is modest?

For amounts like ₹20 lakh, absolutely. But even for smaller amounts, the legal process itself can pressure the builder. Plus, a favourable order means you get your money back through recovery proceedings — often more effective than police complaints alone.

This article is general legal information, not legal advice. Consult a qualified advocate about your specific situation.

Advocate Sudhir Rao, Supreme Court of India

Facing a similar matter? Speak to a Delhi criminal defence lawyer — Advocate Sudhir Rao appears in bail, trial and appellate matters before the Delhi District Courts, the Delhi High Court and the Supreme Court of India.