MUMBAI: Sixteen years after two sets of homebuyers booked flats in a Govandi housing project and allegedly paid the builder ₹ 4.67 crore, a special Maharashtra Protection of Interest of Depositors (MPID) court has ordered the Govandi police to register FIRs against Mishal Constructions Pvt Ltd and its directors/promoters for allegedly failing to hand over possession of the flats or refund their money.
Subsequently, the police filed ‘C’ summary reports, citing the buyers’ pending proceedings before RERA. It held that RERA proceedings and criminal proceedings under the MPID Act operate in different spheres. The court reached the same conclusion in the Sidharthan case, rejecting the police report and ordering an FIR against the builder and its two promoters.
The complaints had been pending since 2023. In October 2024, the court directed the Govandi police to conduct preliminary inquiries and register FIRs if the allegations were found to be well-founded. Because of restrictions under RERA, a criminal court could not take cognisance of the allegations unless there was a complaint from the regulatory authority or its authorised representative, the police reasoned that. Because of the RERA proceedings, in the Mehta case, the judge criticised the police for not registering an FIR.
“The provisions of RERA Act and MPID Act will operate in a different domain,” the court said, adding that once allegations disclose a cognisable offence, the police are required to register an FIR and investigate. The court described the police’s interpretation as a “totally erroneous and misconceived proposition of law” and said the allegations should have been investigated.
It held that pending proceedings before the Maharashtra Real Estate Regulatory Authority (RERA) cannot prevent criminal action under the MPID Act, while directing the police to register FIRs against the company and its promoters Ajitkumar Jain and Navinkumar Jain. The court’s orders, passed on Tuesday by designated judge Vikram R Jagdale, also rejected the police’s closure reports.
Investigation and Response
The judge also held that approaching RERA did not prevent the homebuyers from seeking criminal investigation.
Relying on the MPID Act’s overriding provision, the court said its provisions takes precedence where there was conflict with other laws.
