Consumer court forces real estate company to return money to investors

Consumer court asks real estate company to return the money of investors as it failed to deliver on its promises.

By: Express News Service | New Delhi | Published: November 2, 2015 7:37:42 pm

Following what is possibly a first-of-its-kind order by a consumer court, hundreds of investors, majority of them middle and lower-middle class persons, have started receiving back money that they paid to a real estate company – M/s A J S Builders, which had promised to provide them houses in the National Capital Region (NCR) but without delivering on its promise. In fact, the company had collected “hundreds of crores” of rupees from consumers after promising to provide them flats, etc, on lands, some of which had already been acquired by the government, in Sonepat, Gurgaon and Indirapuram.

The Forum had recently compiled all claims against the erring company and has ordered part-payment, to begin with, of amounts paid by them from money collected through sale of assets of the company.

In its order, the New Delhi Consumer Disputes Redressal Forum comprising president C K Chaturvedi and members S R Chaudhary and Ritu Garodia had imposed penalty of imprisonment for three years under the Consumer Protection Act, 1986, on Madhu Singh, director of the company for failing to satisfy the decree order passed by the Forum.

Madhu Singh had earlier been absconding for years and chased by consumers and police for the offences of cheating and dishonor of cheques issued by her to consumers all over India. She was finally arrested in 2012 and sent to jail. After she appeared before the Forum on production warrants issued by New Delhi District Forum, she claimed to be unaware of all cases and decrees passed against her. She was provided with a list of 198 cases, in which she had to return the money to satisfy the decrees.

However, after she got bail from court, she remained untraceable for about two years. When she was finally nabbed, she claimed that she had no assets or cash to pay back the investors, following which she was told that she could remain in jail in the almost 200 cases pending against her. Faced with this prospect, she disclosed that she had some land in Sonepat which could be sold. She also submitted papers to prove her rights over the property, following which the commission appointed a court commissioner, who was directed to meet the District Collector and examine records with the Tehsildar, etc.

During the process, the court commissioner came to know about some properties owned by Madhu Singh, about which she had not apprised the Forum.

In July last year, the Forum sent Madhu Singh to jail for three years for non-delivery of flats for over nine years to the buyers and failing to implement its previous order for providing compensation.

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