Mumbai Court Refuses Pre-Arrest Bail to Flat Developers Accused of Defrauding Investors of ₹26 Crore

The special MPID court in Thane denied pre-arrest bail to the partners of Ravi Developers and two of their employees, citing a prima facie case of the alleged offenses. The court observed that the accused, Jayesh Tokershi Shah, Ketan Tokershi Shah, Sonal Jayesh Shah, Ravindra Girdhari Rana, and Machindra Bapu Samrut, appeared to have committed the alleged crimes.

The accused had sought pre-arrest bail in connection with a case registered at Kashimira police station, following a complaint from Ajendra Manoharrao Joshi. The complaint alleges cheating, criminal breach of trust, and forgery under the Indian Penal Code, as well as violations of the Maharashtra Protection of Interest of Depositors (in Financial Establishments) Act, 1999 (MPID Act) and the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management, and Transfer) Act, 1963 (MOFA).

Joshi had booked a flat in the Gaurav Aster building on Mira Road in 2020 and paid ₹46.10 lakh after signing an agreement with the developers. However, the commencement certificate (CC) for the project was canceled by the municipal corporation shortly after the agreement was signed. Despite this, the developers continued to accept money and did not provide Joshi with the flat or a refund, prompting him to file an FIR.

The developers’ lawyer, Poonam Jadhav-Hande, argued that the dispute was civil rather than criminal and claimed that the urban land minister had directed the issuance of the CC. She asserted that there was no intention to defraud.

However, Special Public Prosecutor VR Chandane and intervenor advocate Kunal Jhafor argued against granting bail, citing the accused’s criminal history and the fact that they accepted payment and executed agreements despite the canceled CC. They contended that this demonstrated an intention to deceive investors.

The court emphasized the need for custodial interrogation to thoroughly investigate the case, including how the investors’ money was used. The judge noted that additional floors were constructed illegally and that the total amount defrauded was approximately ₹26 crore, affecting 76 purchasers. The court affirmed that the accused were correctly charged under the MPID Act.

The court concluded that given the seriousness of the offenses and the need for custodial interrogation, anticipatory bail was not appropriate in this case.

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