Mumbai Crime: Versova society hit by Rs 3.87-crore fraud

Sanjeev Enclave society on JP Road. The building came up in 1994. Pic/Anurag Ahire

The former office-bearers and ex-manager of a Versova housing society have been accused of siphoning off Rs 3.87 crore from maintenance and other collections over 6 years. The police had earlier booked the manager following a court order, but a recent probe by the Deputy Registrar Co-operative Societies found connivance by the previous managing committee including the chairman. Sanjeev Enclave society on JP Road has 13 floors and 78 flats.

The embezzlement episode unfolded in 2016 after a flat owner spotted some discrepancies in the payment and deposits in the society's bank account. While a new committee was appointed in February of that year, the manager abruptly stopped reporting to work in November, raising suspicion. The new committee roped in two auditing firms to check their books from 2011 to 2015.

"The audit report given by both the firms was shocking as the manager allegedly didn't deposit around Rs 20.13 lakh from 2011 to November 2016 paid by residents towards maintenance and other dues. The society filed a complaint at an Andheri court which directed the Versova police to register an FIR against manager Prakash Palav," a resident told mid-day.

Also read: Vendor chops off Thane assistant municipal commissioner's fingers

The resident said Sanjeev Enclave came up in 1994 and the society collected maintenance charges between Rs 4,000 and Rs 5,000 per flat during the period of scrutiny. Members also paid additional charges for events and functions from time to time. Following an FIR against Palav in 2018, the Deputy Registrar Co-operative Society ordered a re-audit which showed that Rs 7.64 lakh had been gobbled up in 2015-16. This prompted the authority to conduct a detailed inquiry in September 2020 under section 83 of Maharashtra Co-operative Societies Act, 1960.

Advocate Avdhoot Raorane who conducted the inquiry found massive discrepancies in the accounts. He scrutinised 1,127 vouchers, 334 chequebook entries and other documents to find that the fraud was Rs 3.87 crore. "I called each and every person from the committee, members, all the employees working in the building and concluded that a massive fraud had happened in the society. Many times, cash given by residents as maintenance was not deposited in the bank, repair works shown on paper never happened but vouchers and bills were generated." The previous committee had seven members and one of them has passed away, said a resident.

Fraud factory

The report says that Palav and other office-bearers were involved in the fraud. Money which was spent to celebrate a festival in the society was released twice. Lakhs of rupees were moved from banks on the pretext of putting them in fixed deposits but FDs were never created. Fake signs of a watchman, sweepers were used to withdraw money as salary. Advocate Raorane also pointed out that a panel of auditors engaged by the then committee pushed all the illegalities under the carpet. He said in the report that money must have been transferred to some other banks which needs to be investigated.

Baseless charges

SA Qureshi, who was the secretary from 2011 to 2016, said an inquiry is going on and the matter is in the court and the competent authority. "I would not like to comment on the proceedings or about anything as of now." Ashok Jain, who was the chairman during that period said, "The entire allegation against me and committee members is baseless. The manager has done the fraud, not us. The new committee is trying to frame us. Inquiry is going on and the truth will come out."

Trust broken

Vijay Kumar Halan, current chairman of the society, told mid-day, "This is not an easy task. Who would like to prosecute people living in their own society, but they have broken the trust of all members. When we started the inquiry we found the previous committee had misplaced all the papers. They used to demand cash instead of cheques or direct transfer. I've lived here for the past 21 years and I feel really bad as this happened all the while we were here." As per rules, authorities will first try to fix liability on the guilty before ordering criminal prosecution.

78
No. of flats in Sanjeev Enclave housing society