Thousands of homebuyers who have been paying EMIs for flats they never received may finally see faster action after the Supreme Court pulled up the Central Bureau of Investigation (CBI) for delays in investigating alleged fraud linked to subvention schemes.

The court said prolonging the investigation would only increase the hardship faced by buyers who have already suffered due to stalled housing projects and financial stress.

The case involves more than 1,200 homebuyers from Delhi-NCR, particularly from projects in Noida, Greater Noida and Gurugram, who approached the court after being forced by banks to repay loans even though their flats were never delivered.

A bench headed by Chief Justice Surya Kant, along with Justices Joymalya Bagchi and Vipul M Pancholi, directed the CBI to speed up its investigation and convert preliminary enquiries into full criminal cases wherever necessary.

 “This court cannot wait indefinitely for the conclusion of the investigation. Delays will only lead to more agony for the homebuyers who have already been harassed by builders and developers, apparently in collusion with financial institutions and banks,” the bench said.

Many of these buyers had purchased homes under a subvention scheme, which was marketed as a buyer-friendly payment plan.

Under this arrangement:

·         The bank releases the loan amount directly to the builder after the buyer books a flat.

·         The builder promises to pay the EMIs on the loan until the home is completed and handed over.

·         Once the buyer receives possession, the responsibility of paying EMIs shifts to the buyer.

·         However, in many cases, builders allegedly stopped paying EMIs after receiving the loan amount. Banks then turned to the buyers — who were the third party in the agreement — and demanded that they start paying the instalments.

·         This left many families stuck paying both rent and EMIs, while the promised homes remained incomplete.

The Supreme Court expressed concern that the investigation was moving too slowly and warned that delays would only worsen the situation for homebuyers. 

The court directed the CBI to continue investigating all the cases and convert preliminary enquiries into full criminal investigations wherever necessary.

It also rejected a proposal by the CBI to transfer some cases to state agencies, saying the central agency should complete the probe itself.

The court made it clear that it cannot wait indefinitely for the investigation to conclude, especially when thousands of families are already under financial and emotional stress. 

Another concern raised during the hearing was the possible involvement of banks in approving loans under these schemes.

The court asked why bank officials had not been investigated more thoroughly, especially since the loans were sanctioned directly to developers. 

It asked the CBI to file an affidavit detailing the progress of the probe and provide a timeline for completing the investigation.

The court also directed the agency to examine a report submitted earlier by amicus curiae (court-appointed advisor) Rajiv Jain, which highlighted the alleged involvement of banks, developers and even officials from development authorities.