In a scathing order, the Bombay High Court has directed a high-level inquiry into how a developer with "hardly any amounts" in his bank accounts was permitted to undertake major Slum Rehabilitation Authority (SRA) projects and sell nearly 531 flats. The court expressed shock and termed the situation "shameful" for the SRA, highlighting serious concerns of professional negligence and potential financial malpractice.
Court's Conscience 'Shocked' by Developer's Financial Disclosures
The bench of Justices Girish S Kulkarni and Aarti A Sathe was hearing a plea filed by slum dweller Vijay Namdev Gujar, represented by senior advocate Prasad Dhakephalkar and advocate Abhinav Bhatkar. The petition alleged that Darshan Developers had defaulted on paying transit rent to eligible slum dwellers in Kandivali and was delaying the allotment of tenements in the developed premises.
On December 23, the HC had directed the developer to deposit Rs 2.9 crore with the SRA within ten days. It also ordered the proprietors, Pravin Vikram Satra and Darshan Pravin Satra, to file detailed affidavits disclosing their movable and immovable properties, bank account details, other projects in Mumbai, and income tax returns for the last four years.
Upon reviewing the affidavits on December 24, the court stated its conscience was "shocked." The affidavits revealed that the developer had "meagre amounts in six bank accounts." Justice Kulkarni orally remarked, "Even an employee in the subordinate Government Services would have a better financial standing in the bank accounts." The court found it astonishing that an entity with such minimal financial backing had managed to sell 531 units, including 1BHK and 2BHK flats and commercial premises.
HC Flags 'Bogus' Front, Potential Money Laundering
The bench raised alarming doubts about the developer's true credentials. It noted that Pravin Satra's affidavit was "brazenly dishonest" and failed to disclose the bank accounts where the proceeds from the massive flat sales were received.
"It seems completely bogus and 100% case of financial money laundering. Can a person who has meagre amounts be a developer and sell 531 flats?" Justice Kulkarni observed. The court stated it was "afraid to even presume that he can be called a developer."
The HC expressed a strong apprehension that the named developer "appears to be merely a front," and the actual parties executing the slum redevelopment projects were unknown third parties. It criticized the SRA for being either "unaware" of this or "kept in the dark," calling such professional negligence unacceptable.
Stringent Directives and Ongoing Probe
Consequently, the High Court issued a series of stringent directives. It ordered the CEO of the SRA to personally examine the appointment of Darshan Developers in all ongoing SRA projects in Mumbai and Thane. The CEO must submit an inquiry report on whether the developer genuinely undertook these projects and identify the "third parties" involved.
The court also initiated steps for false affidavit proceedings against Pravin Satra. It appointed a court receiver for the properties in question and stated that the SRA was free to lodge a criminal complaint if fraud on government authorities was established.
Furthermore, the SRA CEO was asked to seek an expert opinion on whether this developer should be accepted for any SRA project in the future, a move the court said would protect both slum dwellers and prospective flat purchasers. The court has posted the matter for further hearing on January 9.
The High Court underscored that the intent seemed to be litigation at the cost of poor slum dwellers, for whom transit rent is a right to shelter under Article 21 of the Constitution. This case has put the SRA's oversight mechanisms under severe judicial scrutiny.
