Mumbai: Another housing scam, involving 11,500 homes, hangs fire in high court

Karrm Residency complex wears a deserted look since the developer has stopped the work few years ago

Around 11,500 flat buyers have found themselves bang in the middle of a massive housing complex scam involving a single developer. The buyers have now approached the Bombay High Court, as their complaints and FIRs with state authorities have yielded no action. Notably, the developer employed Bollywood celebrities as brand ambassadors to lure lower middle-class buyers. This case involves forged documents and plans to build buyer trust. The high court has scheduled the next hearing for September 12.

In a criminal writ petition filed under Article 226 of the Constitution, petitioners (nineteen in total), along with numerous other flat purchasers primarily from the lower middle class, have been ensnared in purchasing flats within projects by M/s Karrm Infrastructure (Pvt) Ltd and its directors.

Leakage inside the flat of whistleblower Prabhuram Giri in Karrm Residency

These projects include Karrm Residency at Dhasai village in Shahapur; Karrm Panchtatva at Kasagaon in Shahpur; and Karrm Brahmaand at Kelwe Road in Palghar.
The projects in detail

Karrm Residency: This project comprises four sectors with a total of 3,140 flats. Although the project was set for completion by December 2014, numerous amenities remain incomplete even today.

Karrm Panchtatva: Phase 1, 2, and 3 at Kasgaon, Shahpur District. Phase one structures have not progressed beyond the plinth level, while phases 2 and 3 are barren land.

Prabhuram Giri, the whistleblower and sole resident in the entire complex, and Vivekanand Dhavse another flat buyer and whistleblower

Karrm Brahmaand Affordable Homes: This project in Kelve Road, Palghar, was meant to encompass over 5,000 flats and shops. Despite nearly 4,500 flats/units being sold, construction has not yet commenced.

8 petitioners from Shahpur

Among the eight petitioners from the Shahpur project, Prabhuram Giri, 60, also the whistleblower and petitioner no. 1, resides in the Nirbhay building, Karrm Residency Sector 3- Shahapur. He purchased one BHK flat on the fourth floor, flat no. 401, on July 25, 2013, for Rs 16.35 lakh.

Swati Dhavse is another petitioner from the same project, sector 3. She secured the flat no. 101 in Building Aarju, C wing, by entering an agreement on April 3, 2012, for R8.55 lakh, having paid the entire consideration.

The boundary wall on the agricultural plot at Karrm Residency

Rajendera Chavan, 56, petitioner no. 5, booked flat no. 2 of Aachal building B wing on March 9, 2017, for R30 lakh, with a partial consideration of R3 lakh paid. He is yet to get possession of the house.

Possession pending

Nagina Singh, a 54-year-old school assistant teacher from Bhandup (petitioner no. 4), bought flat no. 301 in Vaayu B wing on April 16, 2012 for Rs 11.86 lakh, with a bank loan and currently ongoing EMIs. However, she's still awaiting possession of the flat.

Pump room below the overhead water tank constructed by the developer; (right) main security cabin at Karrm Residency

The sale agreement between the developer and flat purchasers (petitioners 1 to 8) contained vital documents like the non-agriculture (NA) certificate, advocate-issued title clearance, and necessary permissions. This underscores the accused's apparent commitment to fulfil promised amenities and ensure a peaceful handover.

Tip of the iceberg

Giri and fellow petitioners revealed that in the case of Karrm Residency Sector 3, the construction quality was deplorable, rendering the entire structure dilapidated and the promised amenities absent. The construction abruptly halted in 2018, leaving the site unfinished. The lack of essential facilities, such as an approach road, street lights, sewage treatment plants, water connections, and even lifts, underscore the incomplete state of the project.

Giri exclaimed, "Another flat buyer received a letter from the developer dated January 29, 2014, to pay interest to the developer for infrastructure maintenance, water meter, electricity, etc." This revelation was deeply unsettling.

Irregularities uncovered

Giri delved into the legitimacy of permissions granted and unearthed alarming revelations. The non-agriculture (NA) certificate linked to the sale agreement, purportedly from 2011, is fraudulent. Recent data indicates that parts of the land used for Karrm Residency are still agricultural land.

Moreover, the completion certificate for the project, issued on February 29, 2016, and July 25, 2017, by Dhasai Gram Panchayat, is invalidated. Giri's inquiries revealed that the certificate was cancelled in July 2017 due to resolution no. 52/3.

Giri pursued this under the Right to Information (RTI) Act and learned that only the collector / town planning authorities had the authority to issue completion certificates (CC) and occupation certificates (OC). Dhasai Gram Panchayat lacked this power, rendering the CC and OC issued to Karrm Residency invalid.

Concerns intensify

Notably, parts of the complex, including a 60-foot upper water tank and sections of the project, were constructed on agricultural plots, calims the petition. The project's authenticity is questioned, with flat buyers fearing the dispossession of their investments.

Architectural abandonment

Architectural inspection revealed incomplete construction, absence of water supply and metres, lack of electricity supply and metres, deficient sewage treatment, incomplete elevator/lift installation, and missing street lights.

In essence, the project's integrity is compromised, leaving flat buyers grappling with incomplete amenities and the spectre of dislocation.

COVID lockdown

Vivekanand Dhavse, 61, a businessman residing in Dombivli West, purchased a flat at Karrm Residency, Shahpur, for his wife Swati. He recounted, "We pursued the developer before the COVID-19 lockdown, but excuses followed. Post-lockdown, seeking help from district officials and police led to cold responses."

Dhavse shared an incident where a senior police officer rebuked him for inquiring about the FIR's progress. Instead of addressing the developer's whereabouts, the officer offered tea to a suspect named in the FIR. Dhavse emphasised that thousands of lower-middle-class flat buyers are victims of a massive housing scam, worth thousands of crores, and continue their fight for justice in a state plagued by such deceit.

Legal insights

Senior Criminal Advocate Niteen Pradhan represented the petitioners in the high court, who was assited by Advocate Ameeta Kuttikrishnan.. Kuttikrishnan revealed, "Most buyers are lower middle class, often from the service sector. Many took home loans from banks, only to discover later that the developer took loans in their names from multiple institutions. Even those who repaid loans are receiving recovery notices from other banks. This merits a serious police and state investigation."

The HC recently heard the case and directed all respondents to submit status reports. The order dated June 15 stated that officers familiar with the cases should appear on the next date with investigation records. The next hearing is scheduled for September 12.

8
No. of petitioners from Shahpur

3
No. of projects that were underway