Published On : Wed, Feb 10th, 2016

First City – caught in legal wrangles

File Photo

File Photo

Nagpur: Six years ago with a view to curb unethical practices, the apex body of real estate business in the state, the Maharashtra Chamber of Housing Industry (MCHI), had directed all its members not to book flats without receiving the commencement certificate (CC) from the authorities.

The then MCHI secretary Sunil Mantri had commented “Apart from giving this instruction to our members, we have also decided to let builders have stalls in our exhibitions only if they have the CC of their projects.” He noted that this is a statutory requirement under the Maharashtra Ownership Flats Act (MOFA) and that it will be implemented strictly.

The MCHI had also come down harshly on another practice of many builders – they could not sell flats on the basis of super-built up area but had to do it on carpet area only. This was due to a public outcry against the sale of as high as 40% of built-up area leading the state government to warn builders of action if they did not sell flats on the basis of their carpet area only.

Speaking on the issue, Atul Shirodkar of Reatox – Builder of First City and having other projects in Mumbai had remarked: “I have made it clear in my brochures and advertisements that the flats will be sold strictly on carpet basis. In fact, I am asking the buyers to themselves measure the area of their flats before making the final payment.” He added that several builders had called him up and “accused him of spoiling the real estate market”.

“But I have decided to strictly follow the law” Shirodkar said.

These words must have come back to haunt Atul Shirodkar who had managed to ‘win’ the ambitious MIHAN First City project in Nagpur the second capital of Maharashtra against stiff competition. This would have been his first project in the area and he would naturally have wanted it to be a ‘show case’ for more to come.

Instead, in no time, all he was doing in Nagpur was filing cases – court cases! We might have got the order wrong but these are the cases he has filed/ settled/ lost/ still fighting in the Nagpur Bench of the Bombay High Court:

  1. Defamation case against newspaper Hitavada, who as we mentioned yesterday went against them tongs and hammers. ( Settled out of court, some say with the intervention of prominent Nagpur politician Nitin Gadkari.)
  2. Case against MADC when the First City project was withdrawn from them when it began getting delayed and exceeded the agreed upon time frame. ( This case they lost in High Court and later in Supreme Court also… their project was about 40% complete by then and lot of money had been invested; by both buyers and Reatox).
  3. And now the case they have filed in Nagpur High Court asking for the quashing of the FIRs registered against him due to a criminal complain made by one of the Buyers.
  4. Vijaya Bank case vis a vis Reatox/ Chaurangi when they sought to auction the First city land. ( Settled out of court with the intervention of Gadkari and Fadnavis as reported by us yesterday).

In case No. 3 which was up for its first hearing today, NT learnt that Shirodkar has made the buyer ( Gagandeep Kohli), the Maharashtra Government and MADC co respondents. We also learnt from the Crime branch of Nagpur police that FIRs have been registered against IPC 406, 409, 420 and 434 against the Builder. These are all related to cheating, criminal breach of trust specially regarding property etc. The case is being handled directly under the supervision of ACP Dipali and officer Katak Dhond who are reputed to be very upright and perfect in their investigations.

On the other hand, Shirodkar has roped in Advocate Sunil Manohar, former Advocate General of Maharashtra to fight on his behalf.

In its hearing today, the case that was to heard in the court of Justice Dharmadhikari and Justice Deshpande was adjourned since notices haven’t yet been served on all respondents.

There was a buzz among Buyers about the case and hope that something positive will emerge out of it. Even they are against the land being auctioned by Vijaya Bank since that will mean their hopes of getting their flats being killed forever.

We had quoted a figure of approx Rs. 60 crores as having been invested and paid up by flat owners yesterday. From what NT gathered today, it could actually be as high as 90 or 100 crores. Some NRI buyers have paid up Rs. 70 + lakhs already. Some have bought multiple flats hoping to join them and get a bigger residence.

Speaking to undersigned one affected buyer Kuldeep Singh Bindra said that it was his late father Subhedar Joginder Singh who had invested almost Rs. 10 lakhs in a flat in First city. Subhedar Joginder had retired from the army in 1973 after fighting the 1971 Indo – Pak war. He was looking forward to his own ‘luxury address’ in the city over 2 decades afterwards. When he learnt to his dismay in 2014 that the flat construction was indefinitely held up, his son says ” my father died of shock and grief”.

The son is now 65 years old himself and runs a small auto spare parts shop. First City is not his only disappointment in MIHAN. He and 14 other partners had bought 23 acres of land on Wardha road which was acquired by the State Government for MIHAN. For peanuts, he says.

“This MIHAN project which was supposed to make us in Nagpur rich and prosperous has only brought grief and misery and losses in my life” he laments.

Is there a light at the end of the tunnel for Joginder at least?

Sunita Mudliyar – Associate Editor