Cash Payment of Rs. 1.3 Crore to builder lands victim to soup

A complainant Richbond Finvest Services paid Rs. 1.3 crore in cash to M/s Niraj Kakad Constructions at the interest rate of 24%. When they dragged the builder to MahaRERA (Maharashtra Real Estate Regulatory Authority), nobody knew that it would cause trouble to them and land into soup. Evidence for them stumbled out as case proceedings continued.

Earlier this month, an order was issued in which Vijay Satbir Singh, MahaRERA member, directed the Income Tax Department to investigate the funding source and tax evasion, if any.
According to the real estate experts, this case is rare and first of its kind. Here, cash is found by the authority which is paid to a builder. Since complainant was found as an investor, not flat buyer, the complaint was also dismissed. In the state RERA, the officials added the regulatory authority can fulfill complaints just from genuine buyers. In Chembur, Richbond Finvest Services invested in Devi Kakad Solitaire, a residential

project. It paid Rs. 75 lakh for each of two flats. For his investment, the builder signed a contract to pay 24% as interest every year and offered these flats to him if he fails to repay the loan whose deadline was March 31, 2016. Since the builder couldn’t meet their promise, investor asked for his money back along with registration or compensation of agreement of sale and interest. In his response before the authority, the builder disputed claim and said they have paid only Rs. 10 lakh for each flat and didn’t pay the rest of the amount. Then, Richbond Finvest produced receipts of the full amount of Rs. 75 lakh for each flat which is signed by the builder. But it showed that Rs. 65 lakh for each was paid in cash and rest of the amount through cheques.

The order said, “The facts made it clear in this case that complainant paid Rs. 1.5 crore to the builder in his project for investment… and both parties decided mutually not to register it for sale. On the record, the documents showed that complainant’s status in this project is that of investor, instead of genuine home buyer.”