Raheja Developers BUSTED in Sting Operation By Cobrapost Regarding Black Money

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BREAKING NEWS !!
Sting operation of Raheja Developers reveals how they accept black money in Dubai, and how they under-report the prices to rob the exchequer. Caught on tape are Kartik & Chetan in the Raheja Developers offices …
If they have so much money then why are their projects so late, incomplete, and severely deficient in services? Maybe because most of the money has already been parked abroad instead of being spent on the projects …
Full report of sting on 35 builders is here http://cobrapost.com/index.php/news-detail?nid=7290&cid=23
You can read our full report on Raheja's Grimes & Crimes here http://www.qubrex.com/open-letter-to-housing-minister-about-naredco-chairman-navin-raheja and you can read about how 43 buyers in Raheja Atharva have sued the builder in National Consumer Commission http://comments.gurgaonscoop.com/2014/11/17/forty-three-43-raheja-atharva-buyers-sue-raheja-developers-gurgaon-in-national-consumer-commission-court-case/, one case has been filed by Mr Arunesh Madan of Navodaya, and more cases are in pipeline from Vedaanta & Navodaya.
Warm regards,
Sanjay


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8 comments
qbtpl1
qbtpl1 moderator

Cobrapost has helpfully transcribed the sting operation video http://cobrapost.com/index.php/news-detail?nid=7299&cid=23


Karthik Ramachandran, director-cum-CEO, Raheja Developers; and Chetan, property dealer, Saket, New Delhi


Synonymous with real estate in the country, Raheja Developers need no introduction. When the Cobrapost correspondent proposes to buy 60 units of residential property for a big politician from south India, director-cum-CEO Karthik Ramachandran would not talk business until he meets the client. In such big deals, he tells the correspondent, “It is very necessary that we understand who the customer is.” How big a black component can he adjust in the deal? Ramachandran replies in this typical way to a straight question: “Aap bolo (You tell me) … you give me an offer .. you give me an offer that is there … unka kya hai? (what does he want?) … what is in his mind?”


The correspondent tells him that the politician wants the black money component to be 40-50 per cent of the unit sale price that has been quoted between Rs. 1.5 crore and Rs. 2 crore. Ramachandran is forthcoming but non-committal: “Wo dekh lenge jab deal structure hoga we will see that … waise as an organization we don’t (That we will see … when we will structure the deal we will see that, although as an organization we don’t).” Then there are KYC norms to be met, he says, and then, he goes on to add, “We can structure … we can structure.” He is willing but leaves the issue open.


As the parleys move on, Ramachandran expresses his apprehension pointing to the mobile phone the correspondent is carrying: “Aaj kal ke log kya karte hain … asie hi aa jaate hain aise hi jaise aapne Galaxy rakha hai ye rakha hai (Nowadays people just walk in … as you have kept here this Galaxy).” It is this fear of being exposed by a journalist who walks in posing as a customer that has held Ramachandran back, as he admits, little realizing that this is exactly what is going to happen. “Business discussion mein hum log bahut bol deta hoon … main aise hi bol deta hoon ki don’t worry structure kar sakte hain … kal TV pe ayega ki Raheja CEO … (During business discussion, we usually say a lot of things … I too say don’t worry we can structure it … tomorrow it will be shown on TV that Raheja CEO …).”


But Ramachandran warms up eventually. He admits that adjusting 50 per cent black money in the deal is not a big deal. Explaining that it is simply a matter of being prepared for such a deal, his colleague Chetan adds: “It’s just a mutual agreement aapko bhi pata hai Raheja ko bhi pata hai (It’s just a mutual agreement … you know it so does Raheja).”


Now, Ramachandran is willing to accept the black component of the deal in Dubai where he stays with his family. Look where Ramachandran is asking for the money to be paid: “Bahar kahin de do (Give the money anywhere abroad).” Where? Replies the Raheja CEO, “Dubai.” He goes on to add: “Done deal … done.” Raheja has an office there. So, receiving money there is no problem. It can be collected even in Sharjah. Listen to what Ramachandran claims on camera: “Sharjah mein koi problem nahi hai aap jab bolenge hum pahunch jayenge wahan (There is no problem in Sharjah … when you tell us we will be there).”


All things settled, Ramachandran leaves it to Chetan to deal with their big-ticket client’s front man. Since black money is involved, Chetan explains, they will underinvoice the deal to bring it at par with the prevalent circle rates, and black money is adjusted accordingly. Chetan goes on to claim: “Maine waise kal bhi aapko comfort diya tha ki hum karte hain … toh I am a living example ki ye sab possible hai … kaise karna hai uska procedure main aapko samjha doonga (I had comforted you yesterday that we do it [deal in black money] … I am a living example [to tell you] that this is all possible … how it has to be done, I will explain it to you).”


Finally, Chetan commits to accommodate 50 per cent of black money in the deal. He assures the Cobrapost correspondent: “Inse main 50 boloonga (I will tell him to adjust 50 per cent).” It will be convenient to both parties.


Replying to a mail from Cobrapost asking whether Raheja Developers accept black money while selling properties, Dimple Bhardwaj, general manager, Corp. Communications, Raheja Developers Limited, said: “Please be informed we do not indulge in such malpractises at all, as an ethical organisation.”

ranisantosh77
ranisantosh77

It is quite evident from the video where Kartik Ramachandran is repeatedly saying that as an organization we do not entertain or indulge into such practices at all. for records, please be informed that he left the organization one and a half years ago and went back to his home town in Dubai.

Regards

Dimple Bhardwaj, GM, Corp. Communication, RDL

qbtpl1
qbtpl1 moderator

@ranisantosh77 Ms. Bhardwaj. Please don't try to defend the indefensible. 


You know what goes on, and this was in Raheja Developer offices not in Mr Kartik's home. Also, in one of the sting camera frames Mr Harinder Dhillon (Sr VP of RDL who been with the company from 2005 onwards) is clearly visible when the "conspirators" come out of the conference room at the Raheja Developers offices in Saket. And another tax raid happened in 2010 in which Tax evasion worth Rs 80 crore was unearthed. http://timesofindia.indiatimes.com/city/chandigarh/Tax-evasion-worth-Rs-80cr-unearthed/articleshow/5586071.cms This was in 2010. Will you blame that on Mr Kartik too, esp when he was not even working with RDL then? 


And are you saying that black money never exchanged in any deals by Rahejas - can you state that on an Affidavit? 



ranisantosh77
ranisantosh77

@qbtpl1 @ranisantosh77  : Dear Sanjay


I am not defending my organization. I am just representing the facts. the conversation clearly shows that Kartik is repeatedly denying the reporter that we as a principle do not deal into all this. Harinder was never part of the discussion. And there is no other IT investigation except 2010. I don't need  to give any affidavit for the same please.

qbtpl1
qbtpl1 moderator

@ranisantosh77 @qbtpl1 The denial part is Drama 101. Even the narrator in the Cobrapost sting video says that, and Mr Kartik acknowledges that all his denial-baazi was in case there are hidden cameras. He  is very specific, and damning about the Raptor ECC connection for accepting money in Dubai. He also is willing to sell 60 RDL plots/flats in part cash, and to think that the cash part would be for his personal use and not that of the Raheja's coffers is preposterous. 


Many people know that the reporter's experience was not unusual, but unfortunately no one can come out to say it without suffering themselves. A good review of RDL books, and checking the trail of the apartment/plot deals and the transfer history, of the process of purchasing of land deals, and of how the money is being used to fund purchases of land-banks - all this needs to be investigated by the Income Tax Authorities, as CBDT has ordered. 


Best wishes in this investigation, and the court cases from aggrieved buyers that are coming your way....

ranisantosh77
ranisantosh77

@qbtpl1 @ranisantosh77  I would like to reiterate what I replied a day before that Kartik has been repeatedly saying that we do not deal with all this which is conclusive of us not being involved into any such thing. we are professionals and adhere to systems.

qbtpl1
qbtpl1 moderator

@ranisantosh77 @qbtpl1  


Ms. Dimple Bhardwaj, AGM, Corp Com.


Dimple, despite your attempts to distance yourself from Kartik, the basic issue of black money still remains. And unless a thorough investigation is done the needle of suspicion shall point towards you and the company.


In other companies Black money could be a root cause for all these problems that builders face regarding their performance. Imagine that a company has calculated the profitable selling price to be Rs 7000 per square feet for selling its project. As long as the company takes all the money in cheque or white money, it will go into the accounts of the company. Now if the company sells the same in black money 50-50, it means that the company books will only show receipts of Rs 3500 per square feet, while another Rs 70 lakhs will be in cash (assuming a 2000 sq.ft apartment) and off the company books. What happens to this Rs 70 lakhs in cash is what causes projects to be late, and their quality poor. 


There is no accounting for this Rs 70 lakhs (per apartment or plot) of black money, and it is definitely not stored in the developer offices ! Some may be kept for the company to use in paying bribes, if needed, but chances are that it is used to buy more land-banks for future projects. And much of it may go into the personal pockets of top directors. How would the company then have enough funds for its projects when huge amounts of money have been siphoned off? 


If the company does not have sufficient funds it then tries to extort more money from the existing customers if new customers cannot be found. Some of the steps include adhoc charges, extremely high maintenance charges, denial of delay compensation on flimsy grounds, threats of charging escalation, not making the club, commerical areas, common areas, and not completing the individual apartments till the customer makes life impossible for them. All this may be due to the money crunch in the company as money has been siphoned off by keeping it off the company books. While the individual employees of the company live life in maharaja style - the  company itself suffers. The buyers suffer as the money paid by them has not been used to building their property, but diverted for miscellaneous activities.


Whether this was happening at Raheja Developers will only be known after a detailed investigation, and it matters not whether it was kartik or someone else who disclosed this.

ranisantosh77
ranisantosh77

@qbtpl1 I would like to request you to please stop being judgmental on all this and let the authorities decide upon the facts....thanks

Trackbacks

  1. […] by Cobrapost in 2014, it seems that the operations of the Raheja Group were international. http://comments.gurgaonscoop.com/2014/11/27/raheja-developers-busted-in-sting-operation-by-cobrapost…  In addition to international hawala operations spanning Dubai and Sharjah, they were also […]