SC pulls up banks over alleged nexus with builders in real estate cases

New Delhi: The Supreme Court Thursday asked various lenders-State Bank of India (SBI), UCO Bank, HDFC Bank, ICICI Bank, and Sammaan Capital-to give necessary sanctions for prosecution of their officers who have been prima facie found involved in what it described as "unholy" nexus involving builders and financial institutions.

The property companies allegedly involved include Supertech Ltd, and these financial institutions (FIs) in the NCR and a few other major cities.

Also Read: Plea on consumers 'right to know': Supreme Court grants six weeks to states, others to file responses


The Central Bureau of Investigation (CBI) has been probing the nexus between banks or FIs and builders-cum-developers with respect to real estate projects where homebuyers have paid substantial amounts and projects have either not been launched or construction is yet to start.

A bench led by Chief Justice of India Surya Kant have asked the banks to give sanction in two weeks, failing which they will have to give their explanations to the court.

The apex court also asked the Director General of Police from Uttar Pradesh, Tamil Nadu, Maharashtra, Punjab and Karnataka to consider and provide additional police officers to the CBI on deputation to complete the probe. The requisite officers shall be nominated as early as possible and not later than 10 days, it said, adding that any delay will be taken seriously.

Also Read: Rajya Sabha Passes Bill to Raise Supreme Court Judges' Strength to 38

ED Lens

The CBI has also been asked to share details with the Enforcement Directorate (ED) related to the cases so that the ED can initiate its probe in respect of the proceeds of crime involved in these real estate projects, the CJI said.

Besides, the CBI has also been asked to investigate the allegations against Ozone Group in Karnataka, Rudra Buildwell Projects, and Omaxe Group in Uttar Pradesh.

The CBI shall also examine whether banks have consciously signed agreements to create mortgages in absence of lessees to whom land was leased, the court said, while asking the agency to file its status report in respect of the probe relating to the banks and financial institutions.