Supreme Court freezes bank accounts of real estate firm, its directors; issues warrants

The Supreme Court has frozen the bank accounts of Haryana-based Parsvnath Developers and its directors and issued bailable warrants against the real estate firm’s leadership after taking note of two decades long struggle by senior citizens to secure possession of their houses.

While hearing the matter on Monday, a Bench headed by Chief Justice of India Surya Kant came down heavily on the authorities in Haryana for failing to enforce orders passed by the Haryana Real Estate Regulatory Authority (HRERA) against the real estate firm, PTI reported.

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The apex court stated that the matter exposes serious concerns regarding the effectiveness of the Real Estate (Regulation and Development) Act, 2016, in securing relief for homebuyers.

During the hearing, the top court expressed concern over the “slumber” of regulatory authorities and even suggested a “collusion” between the builder and the Haryana state machinery.

After considering the matter, the Bench, also comprising Justices Joymalya Bagchi and V Mohana, decided to freeze the bank accounts of Parsvnath Hessa Developers Pvt Ltd, Parsvnath Developers Ltd as well as the personal accounts of their managing directors and directors with immediate effect.

“The bank accounts of Respondent number 2 and 3 companies as well as personal accounts of MDs/ Directors/ officers shall remain frozen till further orders. Since the builders are operating mainly in Haryana, we direct the chief secretary of Haryana, the Director General of Police and all collectors, commissioners, Superintendent of police and all Banks to comply with these directions and submit compliance affidavits,” read the top court’s order in the case.

CJI Surya Kant noted that the Bench prima facie was further satisfied that state authorities, especially the Collector and the local police, are “either colluding with the builder or have failed to discharge their official responsibilities”.

The matter came to light after a plea was filed by a cancer survivor, named Rita Tikku, and Lokaish Tikku as they invested their life savings into the “Parsvnath Exotica” project in Gurugram’s Sector 53, according to PTI report.

After considering the petition, the Supreme Court issued notices to the Haryana government, Parsvnath Hessa Developers Pvt Ltd through its managing director, Parsvnath Developers Pvt Ltd, the district magistrate of Gurugram and Haryana’s Department of Town Country Planning.

Further, it told the Haryana chief secretary, the DGP, all district collectors and police commissioners to ensure strict compliance with the order and later submit affidavits in this regard.

“Meanwhile, bailable warrants are issued against respondent No 2 and 3 (Parsvnath Hessa Developers Pvt Ltd and Parsvnath Developers Pvt Ltd) and their Directors. It is made clear that if they don’t enter appearance, this court would be constrained to issue NBWs (non-bailable warrants) to secure their presence (before it),” the bench stated.