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On Feb 18, 2010 the Times of India published a small news item in it’s Chandigarh edition (not in the Gurgaon or Delhi Editions, where Raheja has most of his projects or where Raheja Developers have their office) on page 3 “Tax evasion worth Rs 80 crore unearthed.” It was about search and seizure operations on a builder and informed that “detection of tax evasion worth Rs 80 crore came during scrutiny of purchase orders and payments made for purchase of iron and steel used for construction.” http://timesofindia.indiatimes.com/city/chandigarh/Tax-evasion-worth-Rs-80cr-unearthed/articleshow/5586071.cms “During scrutiny, it was found that the firms never existed. The Raheja Group would make payment in the bogus firms and the entire amount would be withdrawn by group employees the next day.”
No newspaper has printed anything about the progress of the story in the last five-and-a-half years, and one would have expected that the investigation would have been “managed” by the builder. In a heartwarming tale, a thorough investigation was done by the Commissioner of Income Tax (CIT), and the Honorable Delhi High Court in an order dated 10 February 2014 has quashed the shield granted to the errant builder by the Income Tax Settlement Committee of immunity from imposition of penalty and prosecution. http://www.delhicourts.nic.in/feb14/Commissioner%20of%20Income%20Tax%20Vs.pdf with hyperlinks version at http://indiankanoon.org/doc/166191533/
The builder, Raheja Developers, is today knocking at the doors of the Honorable Supreme Court with a Special Leave Petition (SLP 17333 of 2014) pleading for continued immunity from imposition of penalty and prosecution by the Commissioner of Income Tax, with likely listing of the case on August 24, 2015. If the Honorable Supreme Court upholds the order of the High Court dated 10 February 2014 then the money trail can be followed. How this Rs 117.83 crore, that came back to Rahejas “under-the-table,” flowed in the Indian economy would be of great interest to the Supreme Court-appointed Special Investigation Team (SIT) on black money.
And it should be of great interest to the Ministry of Housing and Urban Poverty Alleviation, Govt. of India, under whose aegis is the National Real Estate Development Council, NAREDCO, that this Mr Navin Raheja is the Chairman of the august body. Is Mr Venkaiah Naidu, the Chief Patron of NAREDCO http://www.naredco.in/, aware that the Chairman of NAREDCO is a self-confessed tax chor, who presented false evidence, and committed perjury in the court of justice?
A close reading of the High Court order shows that the case turned against Raheja Developers because of the weak ethics and character flaws of the company’s management. The Honorable High Court determined that Mr Navin Raheja knew all along that the billing of Rs 117.98 crores was fake, but he chose to give false explanations all the way down his slippery slope. One “cannot be permitted to turn honest in installments,” observed the court. It is fascinating how the essential character of the top management can be exposed in a case about the dry subject of taxes, and how the same character flaws explain the crisis situation that the company stands at today.
Over 600 buyers have sued Raheja Developers across projects Raheja Atharva, Raheja Vedaanta, Raheja Navodaya, and Raheja Atlantis at the National Consumer Disputes Redressal Commission (NCDRC), and buyers in Raheja Shilas and Raheja Sampada are gearing up to do the same. The facts raised in this case of “bogus bills for steel and cement” have relevance to the cases at NCDRC, and can bring into question everything from 15% escalation costs to 11% increase in super area demanded by the Rahejas – all pivoted on the fact whether you can trust this builder and his statements at all.
And to make matters worse, fire system inspections on the Atharva & Vedaanta sites have revealed problems that show that these two sites are incomplete and unsafe, and probably have gotten Occupation Certificates by corrupt means. A news report on India News (Metro Channel) can be seen here https://www.youtube.com/watch?v=_IsloudOTUM They are tragedies waiting to happen as Rahejas force buyers to take possession and move into incomplete & unsafe buildings, after submitting to their extortionary demands of lakhs of rupees.
If the honorable courts deem the sites are “not fit for occupation,” and if the Occupation Certificates are cancelled for both the Atharva & Vedaanta sites, Raheja Developers are looking at a financial hit of over Rs 400 crores. It would be a fit outcome, because so far builders like Mr Navin Raheja have gotten away with far too much. Can these builders be allowed to sleep in peace while thousands of buyers work for the first 15 days of the month to just pay their monthly EMI to fill the coffers of the likes of Rahejas, and then feel cheated every moment for the remaining 15 days of the month.
1. CHEATING THE TAXMAN
On 10 February 2010 a search was conducted in the business & residential premises of Raheja Developers, including that of Mr Navin Raheja. Several incriminating documents, cash and other materials were seized. The incriminating documents contained evidence to show that the purchase of cement and steel aggregating to Rs.117.98 crores from 5 parties in Gurgaon and Delhi was bogus or false.
Rahejas then decided to approach the Income Tax Settlement Commission (ITSC) which had vast powers, including the power to grant immunity to Rahejas from penalty and prosecution by the Commissioner of Income Tax (CIT). On 16 December 2011 Rahejas filed an application with the Income Tax Settlement Commission (ITSC) accepting that Rs 39.53 crores of the Rs 117.98 crores were bogus purchases. It meant that Rs 78.45 crores were genuine purchases by Rahejas. IT Settlement Commission then called for reports from the Commissioner of Income Tax (CIT).
The CIT progressively demolished Rahejas claims in a series of reports submitted to the ITSC, step by step. Instead of throwing themselves at the mercy of the courts for leniency, Mr Navin Raheja & Raheja Developers took the ITSC for a grand ride with lies after lies. That seems to be the fundamental DNA of this Raheja Group. By the time the last report was submitted by the CIT on 8 January 2013, it was shown conclusively that the whole amount of Rs 117.98 was bogus and fake purchases – not the Rs 39.53 crores that Rahejas had claimed in their settlement application.
The ITSC, in its meeting on 8 February 2013, decided that Raheja should pay the tax on the full amount of Rs 117.98 crores. ITSC also decided not to penalize Rahejas, and gave them immunity from prosecution. This is what Mr Navin Raheja must have wanted and got; given that Rahejas had been completely cornered with incontrovertible evidence in a series of investigative reports by the CIT.
The COMMISSIONER OF INCOME TAX (CENTRAL)-II (CIT) disagreed with the INCOME TAX SETTLEMENT COMMITTEE (ITSC) and called into question the granting of immunity to Raheja Developers from imposition of penalty and prosecution. A case was filed by the CIT against ITSC (WP(C) 5262 of 2013) at the Delhi High Court. The Honorable Delhi High Court quashed the immunity from imposition of penalty & prosecution granted by ITSC to Rahejas on 10 February 2014. Rahejas appealed this quashing of their immunity at the Honorable Supreme Court by filing a Special Leave Petition (No 17333 of 2014) that is likely to come up for listing for the 3rd time on 24 August 2015.
In the meantime, CIT approached the Honorable High Court for some clarifications about the implementation of their 10 Feb 2014 order that quashed the immunity granted by Income Tax Settlement Commission. In an order dated 17 November 2014 the high court issued clarifications, subject to the final decision of the Honorable Supreme Court in the SLP No 17333/2014 filed by Rahejas. Appearing for ITSC and defending immunity cover granted to Rahejas was Senior Advocate, Mr Salman Khurshid, who was also India’s Minister of External Affairs from 28 October 2012 to 26 October 2014.
The 10 February 2014 order that Mr Navin Raheja has approached the Supreme Court to overturn hinges on his (or the Company’s) character, and what it took for the ITSC to convince Mr Navin Raheja to accept the full truth that the WHOLE AMOUNT of Rs 117.98 crores was concealed income. Mr Navin Raheja was fully aware of this fact from day one “yet (Rahejas) consciously chose not to offer the aforesaid amount as additional income – i.e. income which was not disclosed before the assessing officer – in the application filed before the ITSC under Section 245(1).” For over a year Mr Navin Raheja offered falsehoods and fake evidence in his defence at the Court of Justice, i.e. Income Tax Settlement Commission. Rahejas did not come with clean hands to the IT Settlement Commission.
- Rahejas “submitted certificates by a chartered engineer and a registered valuer in respect of some of the buildings constructed by it, on the basis of which it was argued that the cement and steel actually consumed in the construction was less than what was shown in the books of account by only 15% and therefore the additional income disclosed by it in the settlement application would cover such excess consumption.: ALL LIES. At this Stage Rahejas had accepted only Rs 43.78 crores of the total Rs 117.98 crores as bogus and fake.
- Rahejas even submitted a chart in which they claimed to separate the bogus receipts from the genuine receipts, and sought to show that Rs 74.20 crores were genuine receipts. ALL LIES.
- Rahejas also submitted details of vehicles that were allegedly used to carry the cement, steel, and iron rods. ALL LIES. CIT later submitted a report stating “that verification from the road transport authorities revealed that there was no proof that the registration numbers of the vehicles mentioned in the bills were used for transporting the cement and steel; in some cases, the registration numbers were those of two-wheelers which were incapable of transporting the goods and in some cases the registration numbers were found to be of those vehicles registered with the transport authorities later than the relevant period in which they were claimed to have transported the goods. Some of the transport operators also stated, on cross verification with them, that they did not transport any material for the assessee (Raheja Developers).”
- Over the period of one year the CIT showed that “the parties from whom the applicant (Raheja Developers) had claimed to have made purchases of cement and steel were not trading in those goods at all.” ALL LIES. “One Ashok Oberoi, the proprietor of all those concerns had stated on oath to this effect and had also admitted that they had issued bogus bills of steel, cement and TMT bars to the assessee (Raheja Developers) without actually supplying those materials and that they had charged commission from the assessee at the rate of 10 to 15 paise per hundred rupees for issuing those bills.”
Only after each one of his lies was demolished one by one, and there was just no way out for the cornered Mr Navin Raheja, did he accept the truth. “It was only at that stage, when cornered and when it was unable to rebut the evidence and the facts established by the evidence, that Raheja Developers came forward to accept that the whole amount of Rs 117.98 crores was bogus and fake.
The Honorable High Court observed that “we fail to see any spirit of settlement; In the circumstances, the assessee (Raheja Developers) cannot be said to have “co-operated” in the proceedings before the ITSC.” “This conduct of the assessee (Rahejas), far from showing co-operation in the proceedings before the ITSC, shows defiance and an attitude of a fence-sitter.” Rahejas “sat on the fence” and tested the majesty of law. “In other words the assessee (Raheja Developers) waited till the last moment to make the additional offer.”
And, that is why the Honorable High Court upheld the quashing of the immunity granted to Rahejas from imposition of penalty and prosecution.
It is necessary that Rahejas be prosecuted to the fullest extent of the law, and if the CMD or any of his employees have indulged in criminal matters, they should be suitably punished. If no prosecution happens, and only a financial tax burden (or penalty) is imposed, it won’t be any deterrent, because Rahejas will simply pass on any financial burdens onto their aggrieved and hapless buyers.
2. CHEATING THE BUYERS
Buyers of Raheja properties were recently stunned to receive demands of escalation charges to the tune of almost 15% from Raheja Developers, running into lakhs of rupees for every buyer. This additional demand for escalation is many months after the “final” demand letter had been received by buyers on receipt of Occupation Certificate, which even asked for stamp duty charges to be paid within 30 days at that time. One year has passed for Raheja Atharva buyers, and over 9 months in the case of Raheja Vedaanta, since the “final” demand letter and yet not a single property has been registered in favour of the buyers till date. The chances are very high that Rahejas knew that they would not be able to do the registration of the properties, and yet they demanded the money immediately.
Eventually the District Town Planner (DTP), on basis of complaints of some buyers had to issue a “comply or else” notice to Rahejas on June 15, 2015. The DTP wrote “despite clear instructions to you (Raheja Developers) vide email dated 13.2.2015 and 3.3.2015, wherein you were required to execute conveyance deed / registration within 30 days from orders dated 3.3.2015. However, as highlighted above, it seems you have not complied upon the orders issued by the Authority in letter and spirit. You are hereby directed to sort out the matter within 5 days and submit the compliance report within 7 days from the issuance of this letter failing which necessary action shall be initiated.”
Just like in the case of the ITSC, Rahejas had to be cornered before they complied. And even today they have probably only partially complied. They have returned the money only to people who have complained, and may still holding the money of the others who are ignorant and not seized of this issue. They are still sitting on the fence regarding the others – just like the Honorable High Court had observed in the Tax evasion case. After all, it is in the Raheja Developers DNA to cheat as their court case about the Rs 117.98 crores has shown.
To rub salt in the grave wounds of its buyers, Rahejas have now sent letters increasing the super area by 11%, in addition to the escalation costs (i.e., price over and above the one specified in the Builder Buyer Agreement) to the tune of 15%. The total effect of these two new demands has been a 27% increase in the cost of the flat!! So if the buyers thought the basic price of Raheja Atharva or Vedaanta apartment was Rs 1 crore when they purchased it, the builder is today demanding Rs 1.27crores!! With a conservative estimate of Rs 15 lakhs per apartment, and approximately 2000 apartments in Atharva, Vedaanta, and Navodaya, Mr Navin Raheja is virtually extorting Rs 300 crores from his buyers. Dreaded gangsters like Neeraj Bawana and Vikas Lagarpuria would cower in shame in front of such huge heists.
Experts like us (http://Qubrex.com/contact-us/) in the real estate trade know that these extra charges are bogus, fake, and just thin air – just like the bills of steel, cement, and iron roads that are part of the WP(C) 5262/2013 case at the Honorable Delhi High Court. The buyers surely cannot rely on the internal calculations of the Rahejas, and their calculations need to be verified by independent and qualified experts.
The escalation and super area calculations are complex, and have further been complicated because Rahejas revised their building plans many times, even after they had signed Builder Buyer Agreements with some buyers. In majority of the cases the plans were modified substantially without the consent of the existing buyers, and without communication to the buyers about the ultimate impact of super area and escalations costs to them. In addition to breaking a bunch of laws, this is just plain cheating.
After promising to initial buyers that the Atharva project would have only 450 apartments, Rahejas constructed 700 apartments in the same patch of land. Couple of towers in Atharva were not even made, even though buyers have Builder-Buyer Agreements for allottment in these non-existent towers!! And, after launching Raheja Navodaya and selling out a large part of it, they changed everything including the location of the towers – and inserted a new “project” called Sampada in it; all not only without consent, but also despite dissent in majority of the buyers.
The implication of all these major changes is that Rahejas initial estimate of the bill of materials for construction when Rahejas signed the majority of Builder Buyer Agreements has changed. So, not only the initial numbers on which the calculations were made, but even the architecture of those calculations has changed. If escalation costs are being calculated just on basis of some price indices it is wrong; the change in architecture of the calculations due to the modified building plans need to be taken into account. And, by the way, the price indices during the period of construction have actually fallen, and there is just NO WAY increased 25%. Only if the prices of the input have increased 25% can Rahejas pass on 15% after absorbing 10% themselves. There is a good chance that just like the Rahejas lied to the Income Tax Settlement Commission, they are lying to their buyers. That may be the reason that despite many requests by buyers for Raheja sharing their calculations with them, Rahejas are stonewalling them.
Then is the joke of the super area 11% increase. How stupid do the Rahejas think their buyers are. Busy the buyers may be with other parts of their life, but stupid they are not. And Rahejas will soon find that out. Firstly, Rahejas could increase their super area by a maximum of 5%, and beyond that they were bound to get the consent of the buyers. Needless to say, Rahejas got no consent. Secondly, there is no standard definition of super area, and that is why builders like Rahejas think they can cheat their customers with impunity. Any increase in “super area” is most probably illegal because, firstly, the builder cannot legally sell more than the sanctioned area and, secondly, the Haryana Revenue Department cannot register more area than the Haryana Urban Development Authority has sanctioned in the first place. The chances are that Rahejas are lying about the increase, and just because the Revenue Department & HUDA do not collate their records (a classic case of left hand not knowing what the right hand is doing) Rahejas think they can drive the truck of deception through this gap. That is probably why Rahejas are not sharing their calculations despite the repeated requests of many buyers. To understand this fraud of super area, please look at this article that was posted by the Federation of Apartment Owners Association called “Lets catch Super Chor = Your Super Area” at http://archive.is/CvRZe
DEFINITIONS: The super area is composed of built up-area and common areas, where built-up area is composed of the carpet area and thickness of walls. http://articles.economictimes.indiatimes.com/2012-09-24/news/34062116_1_carpet-area-built-up-area-premium-fsi
The increased super area demand by Rahejas is also surprising because the common areas are not even fully ready in Atharva or Vedaanta. And then, with this increase in “super area,” though your carpet area, or the area that is usable within the apartment, remains exactly the same, unusable and “common areas” (or loading) has increased dramatically. To wit, for 2251 sq.ft and 1640 sq.ft apartments in Atharva the loading was 62%. With increase in super area by 11% it has now fallen to 55.8%. That is all the usable space that you get. And your common areas (wall thickness remains substantially same) have increased from 38% to 44.2% !! Amazing duplicity. Did Rahejas really increase the common areas so much – are these visible areas? It would be interesting as to how Raheja is making 1+1 equal to 3. http://www.squareyards.com/gurgaon-residential-property/raheja-atharva-apartment-3bhk+sq-2251sqft/244/1303/unit
In addition to Raheja’s suspect calculations, that MUST be verified by independent experts, there is the problem of inflated bill of materials in Raheja projects. The Court Case regarding bogus bills for cement, steel, and iron rods shows that the buyers cannot trust a single bill presented by Rahejas. In the Rs 117.98 crore case, not a single bill (or supporting documents that Rahejas later provided to the ITSC) was genuine. Daal main kaala nahi, Raheja ki daal hi kaali thi. How many more such fake bills exist on basis of which Rahejas are asking for “escalation” costs.
Even the “independent” experts, chartered engineer and registered valuer, proved to be biased towards Rahejas in the Tax Evasion case, and so any explanations by Rahejas or his “experts” should be unacceptable to the buyers.
Rahejas are charging high prices for shoddy work and products, and below standard specifications. There are already strong indications that Rahejas are providing electricity meters at highly inflated costs. Given the fact that in the Tax evasion case all the five firms from which Raheja Developers was buying steel, cement, and iron rods were FAKE & BOGUS, how can one trust that the firms from which Rahejas are buying now are genuine. As the Honorable High Court observed “the address of the account holders mentioned in the bank statement of the five firms were found to be fictitious as also the names of the persons who introduced the account holders” in the tax evasion case.
Cheating seems to be in the DNA of Raheja Developers as the Tax Evasion case shows, and it is highly unlikely that it has changed. In fact it, seems to have accelerated. A sting operation by Cobrapost, discussed a little later, seems to prove the criminal behaviour of Rahejas was unabated as recently as in 2014. If Rahejas could get fake bills, could they not get fake OCs and NOCs? There is enough evidence to show that Raheja Developers have false fire No Objection Certificates for the Atharva and Vendaanta projects, and that even the Occupation Certificates for both these residential projects are false and pre-mature.
The Fire Department has sent Objection letters to Rahejas for both Atharva & Vedaanta, with strict riders that the Fire NOC (which by the way has already lapsed in both the projects) will not be renewed till the deficiencies are addressed. And the deficiencies are very very severe. This issue has been discussed in the article here http://comments.gurgaonscoop.com/2015/07/25/how-cheat-builders-like-raheja-developers-navin-raheja-have-caused-crash-of-confidence-in-real-estate-market/ and you can find the Letter of Objections from the Fire Department for Atharva & Vedaanta projects here.
One of the most severe shortcomings is that the Connecting Roads to the Vedaanta & Atharva complexes are missing! In the drawings that Rahejas submitted to the authorities there are supposed to be 12m wide road to Vedaanta, and 24m wide road to Atharva (though 2 Karam road is provided inexplicably in Town & Country Planning licence). But, in reality, there are only 3m (or 11ft) Kuchha roads! Without the road how are Fire Engines supposed to reach into the complex if a fire breaks out. The projects are tragedies waiting to happen, and is a fit case to be prosecuted under IPC Section 336 (Act endangering life or personal safety of others). How was the Fire certificate obtained despite this glaring and fatal violation, and further how was the Occupation Certificate obtained from Shri Anurag Rastogi, IAS (then DG of Town & Country Planning) that certified the project as complete and habitable.
The answer why Mr Raheja did not develop the roads even though it is without a shred of doubt his company’s responsibility lies in their DNA of cheating. They did exactly the same badmashi in the past, and got away in a project called Tata Raisina Residency. They got licences for a project in Sector 59 (Number 201 of 2007), and being unable to sell it themselves roped in Tata Housing to develop the project. Tata Housng took over the project execution and marketing and delivered it, only to realize that there was no connecting road!! You can read comments from reader about this “missing connecting road” here. http://forbesindia.com/article/big-bet/how-tata-housing-reinvented-itself/35785/1#posturcomment
And the story of the false Fire NOCs is not new. Rahejas are incorrigible and repeat offenders, and until they are punished this behaviour will not stop. That is why Adam Smith’s observation is so pertinent – “Mercy to the guilty is cruelty to the innocent.” A big fire broke out in Raheja Atlantis in 2009, and the fire fighting systems were found to be non-functional. http://timesofindia.indiatimes.com/city/delhi/Panic-after-fire-in-Gurgaon-highrise/articleshow/4804699.cms Mr Raheja somehow managed that crisis, and instead of learning to be careful he probably took the lesson that he could manage more fires too; the complaints by residents to concerned authorities be damned.
No lessons were learnt by Raheja Developers from the Atlantis Fire. In fact, they increased the number of violations in the Atharva & Vedaanta project !! Ms Dimple Bhardwaj, GM Corporate Communications, Raheja Developers, who is also quoted in the Times of India on Atlantis fire article as saying “the fire was a minor one,” had this to add as recently as Dec 2014 – “on the link thing, please excuse me for being rude…I am sensible enough not to waste my time on useless people like you. if somebody”s AC catches fire and thus the whole flat, how can you held me responsible for that….o come on!!” http://fyre.it/DCjNpW.4 Ranisantosh77 is the twitter handle used by Dimple Bhardwaj See http://www.livefyre.com/profile/69416268/ and https://twitter.com/ranisantosh77
These are the images from the apartment in Raheja Atlantis, after the “minor fire” according to Ms Dimple Bhardwaj, GM Corporate Communications, Raheja Developers.
It seems that in the psychopathic desire for great fortunes, Mr Navin Raheja has ceased to care for the safety and well being of his buyers. They are just another source of money to him. If one goose laying golden eggs is killed, so what; there are many others in queue. And that is probably why he even went ahead and got premature and false Occupation Certificates even though the buildings were certifiably incomplete and unsafe. Mr Navin Raheja was so careless that he did not even make an effort to complete, within the stipulated 90 days, the conditions for his Occupation Certificate in Atharva issued to him by Mr Anurag Rastogi, IAS. The District Town Planner had to recently write to Rahejas after complaints by buyers that the conditions of his Occupation Certificate granted one year ago were still unmet. It seems in an Andher Nagri Chaupat Raja situation, there is no one from the Govt who can ensure and enforce compliance.
Mr Navin Raheja also seems to be becoming more and more brazen about his crimes, and is pushing his luck as far as he can. Just because he has been able to get away almost scot-free so far with just minor financial implications, he may be thinking that he can continue to get away every time. When buyers first raised questions about the fake fire certificates, Mr Raheja was indignant, and dared the buyers to get the certificates checked ANYWHERE. He also threatened dangerous consequences once the allegations were proved wrong. Thankfully for the buyers, the allegations were absolutely true.
And there is a very bitter irony in the situation of the buyers. The irony is that if any penalties are imposed on Raheja Developers, these penalties will indirectly have to be paid by the buyers. The builder is just going to pass this cost to the buyers, rather than taking it out from his profits. This may partially explain the extortionary demands of “increased super area” and “escalations costs.”
And the double irony for the buyers is that they are probably, indirectly, already paying the legal fees for the personal crimes of the Chariman and some of his employees in cases like the one at Honorable High Court, the SLP at the Honorable Supreme Court, and even the 25+ cases at the National Consumer Commission. Many of the personal criminal actions of the CMD and employees (IPC Section 120B and 34 can be applied) should be defended by their own funds, not that of the Limited Company. Since when has a Ltd Company started defending criminal actions of the employees; the allegations are not simple civil / contractual disputes or misunderstandings, but serious crimes. The organization has no business defending these criminals.
And the triple irony: Raheja Developers must be really laughing at how they first cheat the buyers, and then use that same money cheated from buyers to fight cases against those very buyers who accuse them of cheating. The buyers must have gotten the first shock when they realized that the “reputed” Rahejas were actually cheating them, and then an even more powerful after-shock when they realized that these were not the “reputed” Rahejas from the South!!
THE FAULT LIES NOT IN OUR STARS, BUT LIES IN OUR SYSTEM ITSELF.
Even the Honorable High Court made a caustic observation about Rahejas, and wrote in the 10 Feb 2014 order that “the spirit of settlement was (is) absolutely lacking; it may not be without justification to say that the assessee (Raheja Developers) was indulging in abuse of a well-intentioned statutory provision.” This behaviour is also evident in the Rahejas “relationship” with the buyers where they are seeking to invoke the text of the Builder-Buyers Agreement with devious intentions, abhorable conduct, and maliciously exploiting submarine clauses. They are also abusing the dominant position that they hold against the buyer by virtue of having collected tens of lakhs rupees from each buyer in payments till date. And as the case is progressing, henchmen of Navin Raheja like Harinder Dhillon are flying across the world making offers of “handsome exits” to buyers who are helping lead the cavalry charge against this corrupt & morally degenerate builder. Instead of mending his ways, the corrupt and rapacious builder is trying to bend the buyers.
But now, finally the tide maybe turning. Over 600 buyers are suing Raheja Developers in National Consumer Commission, and may finally prove Navin Raheja’s arrogance and over-confidence misplaced. The buyers are also getting ready to expand the fight for justice to other platforms. The fight is worth lakhs of rupees to each buyer, and that is why they must do their best to ensure its win. They should pay their membership fee to the Associations, and contribute information and knowledge to help strengthen the buyers network.
3. FOLLOW THE MONEY TRAIL
The amount of “black money” that Mr Navin Raheja and some of his employees had siphoned off from the company from 2004 to 2010 on basis of fake and bogus bills for steel, cement, and iron rods amounted to Rs 117.98 crores. Where did all this money go in those intervening years before Mr Raheja was busted in 2010. Did this practice really stop after 2010? These are huge sums of money and that is why Mr Navin Raheja and Raheja Developers need to be prosecuted, and appropriate penalty imposed on them. This is for the Honorable Supreme Court to now decide.
The amount of fake and bogus bills amounted to Rs 117.98 crores. For every fake bill of Rs 100, the agents charged 10 to 15 paise according to Court documents. At an average cost of 12 paise per Rs 100, the amount that the Rahejas paid to the agents is approximately Rs 15 lakhs. This implies that Rahejas made payments to five bogus firms for Rs 117.98 crores, and got back under-the-table Rs 117.83 crores. That is a HUGE AMOUNT OF BLACK MONEY.
The Honorable Delhi High Court in their 10 February 2004 order was probably charitable about the money trail with their remark “there was no information forthcoming as to the destination of those funds leading to the inference that they (funds) came back to the till of the assessee (Raheja Developers); the addresses given by those firms were found to be non-existent. The Honorable High Court order is also silent about the company officials who were a part of this conspiracy, and who are equally guilty of any civil or criminal matters that were done. There seems to be a big web of conspiracy, and their tentacles are deep and wide in society. In bringing out the truth of these dangerous practices in real estate we have felt this invisible web far and wide.
The huge sums of money involved, with the possibility that more of it might have continued after 2010, make it essential that the money trail be followed. Such large (HUMUNGOUS) amounts of money in the hands of a small group of owners in a private company can do great damage to society and our country. A perusal of the website http://www.ipaidabribe.com/ (I Paid A Bribe.com) which collects field reports of bribes paid by consumers all over India shows that 117.83 crores can unduly influence HUGE number of public servants, and paid news & sponsorships in media can buy a lot of positive coverage (and supress negative coverage). Suspiciously, some public servants seem disinclined to act against Rahejas, and some have gone out of their way to help the Rahejas. It would not out-of-place to see if Prevention of Corruption Act is applicable here, for which there has to be a thorough prosecution to follow the money trail.
After the Honorable High Court’s “inference that they (i.e.funds) came back to the till of the assessee (Navin Raheja & Raheja Developers),” there is a chance that they funds either ended up in personal possession of the group and its employees, or were kept on the books of Raheja Developers via a parallel accounting system. To get to the truth, we must “follow the money” as it was done in unravelling the Watergate Scandal. “The key was the secret campaign cash, and it should all be traced,” Woodward said to Senator Sam Ervin. How Rahejas pumped over Rs 118 crores of black money into the Indian Economy would reveal a lot of how this whole system works.
- IF THE MONEY CAME BACK ON THE COMPANY BOOKS: The funds could have come back to the company books, and maintained in a parallel accounting system. The sums of money are huge and managing it is not an amateur’s play. And to what purpose was it used. It has to be for purposes that Raheja Developers could not write cheques for, because if they could they would be writing these genuine cheques rather than the fake & bogus ones for steel, cement, and iron rods. This money was most probably used to buy favors from public servants and government authorities, and also influence the media. And, what a story would unravel if this was true, and if the Honorable Supreme Court upholds the Delhi High Court order to allow prosecution and imposition of penalty on Raheja Developers we might be able to get to the bottom of the story.
- IF THE MONEY CAME BACK OFF THE COMPANY BOOKS: If the funds came back to Mr Navin Raheja and the company employees, and they were kept off the books, then they were most probably used for personal enrichment and spending. It would be interesting to see what personal passions consumed such large amounts of money. What was done to the money stolen from the lifetime savings of buyers, and if any of that money ended up in the dens of vice.
And based on a sting operation 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-regarding-black-money/ In addition to international hawala operations spanning Dubai and Sharjah, they were also under-invoicing properties to collect the difference in cash, and at the same time cheat the exchequer. http://fyre.it/4ByNWE.4 Central Bureau of Direct Taxes had ordered an investigation based on this, but the result have so far not been made public. You can see the video here https://www.youtube.com/watch?v=C3WFFYDvliA
Lies, lies, and yet no one seems to raise these questons publicly of the Rahejas. Ms Dimple Bhardwaj is great at managing the media in her job as GM of Corporate Communications. You won’t see a Sanjeev Ahuja or Rao Jaswant Singh (Bureau Chiefs in Gurgaon of HT and TOI) asking Mr Navin Raheja any uncomfortable questions; though each of them has the other on speed dial. Best Friends Forever.
No one seems to follow these stories to their logical end. People who start probing into the activities are soon compromised or neutralized. And the Rahejas play the victim in an Oscar deserving performance. Competitors are trying to run them down. People who speak against them are failed extortionists or blackmailers. Buyers complaining against them are greedy investors who have now turned against them because the markets are down. Buyers are defaulters who have not made payments in time, and are now trying to browbeat the company. Etc. etc. It is always some else’s mistake. Even the connecting roads in Atharva & Vedaanta, which via RTIs and other sources has shown to be the responsibility of Rahejas, is not their responsibility according to them.
Without the restraints of a free and unbridled press, Raheja seems to justify everything in his quest for a great fortune. In a recent interview on NDTV Mr Raheja belittles the Honorable National Green Tribunal (NGT) saying that “jab buildinge almost tyaar ho gaye to Okhla Bird Sanctuary ki yaad aa gaye…. ab aap ko ek chhota sa Okhla Bird sanctuary yaad aa gaya.” You can see Mr Navin Raheja’s extended rambling answer here https://youtu.be/giRz_r11JAE?t=11m44s
In another interview on NDTV http://www.ndtv.com/video/player/property-india/property-india-land-acquisition-ordinance/351881 he dismisses the rights of landowners coldly. Siding with the land acquirers, Mr Navin Raheja reasoned that for the benefit of 99% of India’s population if the land of the remaining 1% was acquired with/without their consent & adequate compensation, it was okay as 99% of the population was benefiting. It was okay to sacrifice 1% if 99% were benefiting.
- Right here, in this perverted logic of a psychotic mind lies the clue to the DNA of Raheja Developers, which Mr Raheja has been repeating many times on multiple platforms.
- Firstly, 1% looks small, but then the population of India is around 120 crore. So, in absolute numbers it means sacrificing 1.2 crore people. That is 12 million people.
- Secondly, what stops Mr Navin Raheja from justifying sacrificing 2% for the benefit of remaining 98%, or sacrificing 3% for the benefit of remaining 97% …. and on till he can justify sacrificing 99% of the people for the benefit of 1% special people like him.
With Mr Raheja’s way of thinking, it is quite possible to justify sacrificing the rights of only a few buyers. On the slippery slope, beyond a certain point, people who think of other people as objects can indulge in very narcissistic and dangerous behaviour. “The dark side of self-obsessed fraudsters is that they see other people as objects,” Ms Frankel is quoted in an article in the Economist on the “Biggest Fraud in History.” http://www.economist.com/news/christmas-specials/21568583-biggest-fraud-history-warning-professional-and-amateur-investors “It is not that they consciously ignore others’ feelings, as selfish people do; rather, others do not figure at all. This is what makes narcissists such as MacGregor really dangerous. He showed no concern for his settlers. They were merely an extra source of funds …” Raheja Developers Ltd looks at its buyers as just another source of funds, and that probably explains the one-sided and avarice dripping clauses.
For too long people have being saying “builders will be builders,” like saying “boys will be boys.” If you want a house, have to pass through this muck of real estate and getting shafted by the builders. That is how low the image of realtors is to begin with. But, boys can be boys till a limit, after which it is not okay. And it seems that builders have crossed that limit. After taking hundreds of crores each from the buyers, the builders are now turning renegade. It is no longer okay. There is a limit beyond which it is not okay to justify things, and now it is not okay to say that “builders will builders.”
Maybe Mr Navin Raheja should offer himself to become the 1% sacrificed to revive the real estate market for the remaining 99%. Letting the law takes its own course would be a good start for the Rahejas. Otherwise there is no stopping the open loot that real-estate seems to have become for some of these builders. So far the builders have not had to fear jail, and there are no punitive and exemplary damages, and that is why crime still pays. In a simple cost/benefit analysis it seems that the builders are calculating that after committing 100 crimes, getting caught in a few, and paying penalty in some, they will still come out ahead. That why “The Central Board of Direct Taxes (CBDT), in a recent missive to its field officials, has stressed the need to instill the fear of “incarceration and consequent loss of liberty and social opprobrium” among tax evaders by way of speedy prosecution and penalties. http://indianexpress.com/article/india/india-others/not-just-raids-need-fear-of-jail-to-scare-tax-evaders-cbdt/
The matter of whether Mr Navin Raheja and other employees of Raheja Developers should be prosecuted and penalty imposed on them, is coming up at the Supreme Court and is very important. Maybe 3rd parties like Buyers Associations and NGOs should implead themselves into this Rahejas case of Special Leave Petition (Number 17333 of 2014), to bring to the notice of the Honorable Court the modus operandi of such notorious builders. The SLP is likely to be listed on 24 August 2015 at the Honorable Supreme Court.
A full and detailed audit and enquiry is the need of the hour. We need to follow the money trail, and let it take us to where-ever and who-ever it leads to. There should be prosecution on all fronts, and exemplary penalty should be imposed if guilt is established.
4. PROSECUTION, PENALTY & DETERRENCE
The Special Leave Petitions of Raheja Developers against the Commissioner of Income Tax (SLP(C) No 17333 of 2014 and SLP(C) No 5442 of 2015 at the Honorable Supreme Court) is to regain the immunity against penalty & prosecution given to the Rahejas in the impugned order of the Income Tax Settlement Commission (ITSC) on 8 February 2013. The immunity granted by ITSC was quashed in a 10 February 2014 order by the Honorable Delhi High Court, and Rahejas are appealing against that order. Rahejas want immunity from imposition of penalty and prosecution.
The orders of the Honorable Supreme Court are going to be final & binding in regards to the immunity granted to Rahejas, but in the meantime it is pertinent to ask the question of whether penalty and prosecution serve a larger purpose in deterring tax cheats. The Central Board of Direct Taxes (India’s top-most body on Income Taxes) believes so, and in an advisory issued recently specifically stated that “The searches have become limited to mere detection of tax evasion, and that too mostly based on admission,” adding that “repeat searches in same groups within a short span of time showed that they were not an effective tool to deter tax evaders.” http://indianexpress.com/article/india/india-others/not-just-raids-need-fear-of-jail-to-scare-tax-evaders-cbdt
When a strain of virus becomes virulent and no longer responds to older methods, then new treatment methods are needed. Only a thorough prosecution and investigation will dissuade this builder, and others, from cheating the exchequer in the future.
INVESTIGATION & PROSECUTION: It is essential that after thorough investigations the errant builders should be comprehensively prosecuted. The money trail should be followed, which in the case of Rahejas Rs 117.98 crores should not be difficult even though so many years have elapsed since the seizure. Like a rat on a dissection table, the underbelly and corruption of the real estate sector needs to be studied. It is essential to study the real estate sector as it contributes 6-7% to the GDP (which is HUGE), and has a cascading effect on over 250 ancillary industries.
The Supreme Court appointed Special Investigation Team (SIT) to check the black money menace could also turn their attention to Raheja Developers. The Cobrapost Sting operation that exposed the international dimensions of Raheja Developers hawala operations & black money are already under investigation by the Central Board of Direct Taxes (http://www.financialexpress.com/article/economy/blackmoney-cbdt-orders-probe-against-select-real-estate-firms/13999/) and would be of interest to the Income Tax Department that recently took out large advertisements in the newspapers about black money.
Even Prime Minister Narendra Modi declared that “Corruption is a Termite which Needs Injection of Medicine,” from the ramparts of the Red Fort on India’s 69th Independence day. http://www.ndtv.com/india-news/corruption-is-a-termite-needs-injection-of-medicine-pm-modi-at-red-fort-1207559/ It would be a good idea to start by injecting the medicine in builders like Mr Navin Raheja (also Chairman of NAREDCO) and Raheja Developers.
The respected Prime Minister Shri Narendra Modi should also consider applying Prevention of Corruption Act, 1988, to the cases surrounding Navin Raheja and ORS. It is impossible that builders like Navin Raheja have benefitted to the tune of hundreds of crores of rupees without the active or passive support of public servants. False fire fitness certificates have been procured by Raheja Developers from the FIRE Department. They have also procured pre-mature and false Occupation Certificates from Directorate of Town & Country Planning (DTCP). The false OC was enabled by false reports by field officers in departments like the Haryana Urban Development Agency (HUDA). Even National Highway Authority of India (NHAI) effectively allowed them illegal access from the National Highway 8, after cutting through a Green Belt, for a long time.
Even the highly trumpted Slum Rehabilitation Scheme, where Navin Raheja is planning “Navin” Minar residential project three times taller than the historic Qutub Minar, is mired in allegations of a scam to the tune of Rs 1000 crores in collusion with Delhi Development Authority (DDA). Before elections Ms Meenakshi Lekhi of Bhartiya Janta Party had demanded a “CBI probe” into this scam of Rahejas & DDA, but somehow this demand lost steam. A Prevention of Corruption Act investigation into the Kathputli Colony Scam would be pertinent and timely, and a good place for the PM to administer his medicine for corruption.
Big announcements aside, the reality is that, like Ms Lekhi, Prime Minister Narendra Modi has let down the buyers affected by the criminalities of Rahejas. The PMO and BJP have not put in sufficient effort to make their own promises come true. In particular we point to the complaint made to the Prime Minister’s Office with great hope in December 2014 by the Buyers Association of Raheja Atharva. On 18 December 2014 the Prime Minister’s Office wrote to the Chief Secretary of Haryana to look “into the (Raheja Developers) matter and a report sent to this (PMO) office, expeditiously.” EXPEDITIOUSLY means “acting done with speed and efficiency.” But, eight loooong months later, nothing has happened. Is this how long it takes the top bureaucrat of Haryana to respond to the PMO? Does this non-response by CS of Haryana reflect the weakness of the Prime Minister’s Office or does it reflect the strength of the Rahejas?
We seem to have been clinging to the mistaken notion of power and majesty of the Prime Minister’s power. Since childhood we had this notion that the most powerful person in India is the one who is in the Prime Minister’s Office. He or she could enter any geographic facility in India, any army cantonment, any nuclear facility, any school or college, or any business facility at any time with a moment’s notice. An aeroplane is available at his or her beck and call to fly to anywhere. And he or she has the power to call upon the best experts in any field and subject matter. Yet, the order from this Prime Minister’s Office is lying unattended for 8 months in the office of the Chief Secretary of one of the many states of this great nation of India; actually in a state that is currently being ruled by the PM’s own party, the Bhartiya Janta Party.
It is a monumental tragedy that the most powerful office in Haryana, i.e. Chief Secretary, has not been able to act on the order of the most powerful office in India. If we were to look for faults in the system, this would be a good place to start. What is it that takes away from the power and majesty of our public offices. The fault certainly lies in our systems, and not in our stars; no matter how superstitious we are.
The result of no action against Mr Navin Raheja and Raheja Developers is that the Prime Minister, Union Minister Venkaiah Naidu, and Chief Secretary of Haryana are enabling Mr Raheja to continue as the Chairman of the National Real Estate Development Council (NAREDCO). Is it the right decision to let Mr Navin Raheja be the face of, and to represent, thousands of builders in India’s top builder association.
PM Shri Narendra Modi & UM (and NAREDCO Patron) Shri Venkaiah Naidu should immediately ask Mr Navin Raheja to resign from the Chairmanship of NAREDCO, till the time is name is cleared and the serious cases against him disposed off. Mr Navin Raheja’s continued Chairmanship of NAREDCO has a corrosive effect on the Raheja buyers because the undue influence and access this chair provides, and also has a corrosive effect on all buyers affected by the lobbying of NAREDCO and pernicious influence the Chairman has on the Ministry of Housing and Urban Poverty Alleviation, Govt of India.
- Mr Navin Raheja as NAREDCO Chairman has opposed the Real Estate Regulation Bill. “We opposed the bill in the current form. Bill is not practical and it is one sided, in favour of consumers,” NAREDCO president Navin Raheja told PTI. http://profit.ndtv.com/news/real-estate/article-builders-oppose-real-estate-regulatory-bill-316250
- Mr Raheja has also opposed the Escrow Account provision in the bill giving rambling and non-sensical justifications. See https://youtu.be/giRz_r11JAE?t=6m56s
- Then was the illegal, unconstitutional, and mishevious suggestion that if the buyers approached the Real Estate Regulator, then all other legal options should be closed to them. “The association sought that all consumer complaints should be addressed to the proposed real estate regulator and no other authorities should attend their complains,” Mr Raheja said. http://profit.ndtv.com/news/real-estate/article-builders-oppose-real-estate-regulatory-bill-316250
- On top of that the initial stance was to keep the commercial real estate out of the purview of the bill. Commercial real estate is where there is more ghapala than residential real estate, but as the buyers are not “Consumers” and can’t approach the consumer courts, their options for relief are fewer. “Commercial real estate must not be brought under another suffocating regulatory control. This would not be of much help and will be rather an impediment in business,” Mr Navin Raheja had been claiming in 2014 http://www.naredco.in/news-updates-details.asp?id=10698&prYear=2014&xmon=Jul&st=1&links=nw2
- NAREDCO is also running realty management courses that are suppposed to train real estate agents, sales persons and commercial and customer-care executives. What sort of role-model and ethics will these people follow in their lives when they learn that the top man of NAREDCO is successful probably because of the highly unethical practices that he has employed in his personal business of Raheja Developers. http://naredco.in/news-updates-details.asp?id=13795&prYear=2015
Is it the right decision to let the Mr Navin Raheja continue as the Chairman even as he is a self-confessed tax chor, and against whom over 600 buyers have filed over 25 cases at the National Consumer Disputes Redressal Commission; the latest case of around 35 buyers in Atharva being filed just a few days ago? Based on court documents, RTI documents, and other incontrovertible evidences, some of the Indian Penal Code sections under which Mr Navin Raheja and Raheja Developers could be prosecuted are as follows: https://en.wikipedia.org/wiki/List_of_sections_of_Indian_Penal_Code
- IPC Section 177. Furnishing false information
- IPC Section 200. Using as true such declaration knowing it to be false
- IPC Section 336. Act endangering life or personal safety of others
- IPC Section 418. Cheating with knowledge that wrongful loss may ensue to person whose interest offender is bound to protect
- IPC Section 464. Making a false document
- IPC Section 25. “Fraudulently”
- IPC Section 383. Extortion
- IPC Section 415. Cheating
- IPC Section 425. Mischief
- IPC Section 477A. Falsification of accounts
- IPC Section 24. “Dishonestly”
- IPC Section 120A. Definition of criminal conspiracy
- IPC Section 34. Acts done by several persons in furtherance of common intention
- Haryana Fire Service Act, 2009, Sections 31 & 32 http://ulbharyana.gov.in/wp-content/Data/act/HaryanaFireServiceAct.pdf
PENALTY & PENITENTIARY: Just collecting the tax due from tax chors like Raheja Developers, or even imposing small penalties, is just not cutting it anymore. Even the CBDT has realized it and has told its officials to change their mindset “from using searches as a revenue augmenting tool to creating credible deterrence by sustainable penalties and prosecution so that “potential evaders desist from crossing the red line”. http://indianexpress.com/article/india/india-others/not-just-raids-need-fear-of-jail-to-scare-tax-evaders-cbdt The penalties should be sustainable and high enough to prevent the tax chors from crossing the red line again and again.
So far, in his public appearances, Mr Raheja has seemed to be unruffled by all these actions against him. He seems to be confident of beating all these adverse situations in his business. He knows that few buyers take the fight to the end, and the public servants really don’t have anything of their own invested in these situations. So, he just waits, like the High Court observed, on the fence. He makes the offers in installments testing the patience of the quarry, and with this basic strategy he has gotten quite far, and gets off quite easily.
Recently, Raheja’s henchmen like Harinder Dhillon have been flying all across the world to make deals for “handsome exits” to buyers who have been actively pursuing their cases against him – but so far they have had little success.
Rahejas have also tried to muffle our voice, and with false and fake documents got our youtube channel with over 350+ videos shut down. Initially the police were helping us in these cybercrimes by Rahejas, but after Mr Raheja’s counter-complaint the police seems to have stopped their investigation. It seems that Rahejas still have remnants of their power & influence working for them.
The reason why Mr Navin Raheja seems unruffled is because he is stinking rich, and everything that he wanted to get done had a price – a price he could easily pay. Mr Raheja is also probably betting that no matter what penalties that the Honorable High Courts & Consumer Courts may impose he will be easily pay them off. In addition to the wealth in hand, they have “projects over 60 million sq.ft at various stages of execution,” and “projects spanning over 900 acres of land at various stages of deliberations.” At a conservative estimate of Rs 1000 per sq.ft profit, the value of 60 million sq.ft is Rs 6000 crore – and even more adding the value of 900 acres of land. For perspective, a residential project like Atharva or Vedaanta is only 1 to 2 million sq.ft in size (or 10-20 acres) – and he has 60 million sq.ft in various stages of execution (and 900 acres of land)!! How a failed scooter dealer was able to amass such immense wealth is another story for another day.
The immense wealth of Navin Raheja and Raheja Developers seems to infuse them with a surreal belief in their immunity from any of the “adverse” situations that their business is passing through. Everything that has a price can and will be bought. That is why the fear of financial penalties is not a deterrence. Even if the NCDRC were to impose penalties running into Rs 400-500 crores, the Rahejas could easily absorb that. Only the fear of penitentiary may provide some element of deterrence.
Fear of penitentiary, or jail, does seem to work. Parsvnath Developers were dilly-dallying paying the amount due to the buyer despite court orders. But, when the exasperated Honorable Judge ordered the immediate arrest of Mr Pradeep Jain, and deportation to Tihar Jail, Mr Jain swung into action. Within 15 minutes a demand draft for approx Rs 15 lakhs was produced and handed over to the harrassed buyer, with due apologies to the Honorable Court.
DETERRENCE & JUSTICE: The parliamentarians and decision makers are coming around to the notion that only the prospect of jail time can curb the obnoxious and ravenous greed of the builders. That is why after many flip-flops and strong resistance by builder lobbies like NAREDCO (surprise, surprise!!) and CREDAI, the latest is that the Real Estate (Regulation and Development) Bill will retain the provisions to send errant builders to jail.
Even the Haryana Lokayukta wants criminal cases to be filed against builders in the Rs 10,618 crore tax evasion scam by builders, developers and traders in Haryana, particularly in Gurgaon and Faridabad. http://news.qubrex.com/2015/03/24/lokayukta-wants-criminal-cases-in-rs-10k-cr-tax-scam-times-of-india-19-mar-2015/ This scam was unearthed by a Special Investigation Team (SIT). “Investigations have also revealed that senior bureaucrats, industrialists and developers even tried to derail the SIT probe into the value added tax/sales tax evasion scam, adding that it has links to Delhi, Rajasthan, Punjab and other states.” “The Lokayukta observed that the Rs 10,000 crore tax scam merits criminal as well as departmental action.”
The Central Board of Direct Taxes has also observed that jail, and fear of incarceration, is essential for deterrence. CBDT wrote in its advisory that “deviant assessees take minor financial hiccups in their stride and promptly return to their wayward ways. What scares them is the fear of incarceration and consequent loss of liberty and social opprobrium that it brings. It is to this fear that a search or survey action must address itself,” the advisory said. http://indianexpress.com/article/india/india-others/not-just-raids-need-fear-of-jail-to-scare-tax-evaders-cbdt/
It is time for the Rahejas to wake-up and repent. The buyers can now clearly see through the duplicity of the Rahejas. The observations made about the character of Raheja Developers by the Honorable Delhi High Court are now clearly evident to one and all. The Raheja buyers have organized themselves in large numbers, have engaged experts, collected information via RTIs, and have enough financial wherewithal to match Raheja Developers step to step. Other platforms where Rahejas are being engaged will soon be made public.
The case of Rahejas and their abuse of customers is going national. This is a landmark fight, and its after-effects will be felt in real estate all over India.
5. ANNEXURE: Timeline of Raheja’s Rs 117.98 crore Tax Evasion Case
- 10 February 2010 – Search Conducted on premises of Raheja Developers
- 16 December 2011 – Rahejas file application before Settlement Commission accepting Rs 39.53 crore of Rs 117.98 as bogus purchases.
- 2 February 2012 – Letter from CIT to ITSC that parties from whom applicant had claimed to have made purchases of cement and steel were not trading in those goods at all.
- 24 September 2012 – Report Submitted by CIT to ITSC
- 17 October 2012 – CIT files another report after which Rahejas accept Rs 43.78 crores of 117.98 crore as bogus purchases.
- 18 October 2012 – CIT directed by ITSC to carry out further enquiries.
- 16 November 2012 CIT records statement of Ashok Oberoi that all bills issued to Rahejas were bogus.
- 10 December 2012 — CIT files another report that stated that Ashok Oberoi had earlier statements of all bills raised by Rahejas were bogus.
- 8 January 2013 – Final report to the ITSC that verification of transport information revealed that all claims by Rahejas were false.
- 10 January 2013 – ITSC had a hearing in which Rahejas were not able to controvert any findings recorded in the CIT Reports
- 15 January 2013 – Last hearing of ITSC in which Rahejas accepted that not 39.53, and not 43.78 crores, but that the whole amount of 117.98 was bogus purchases.
- 8 February 2013 – Order passed by the ITSC granting immunity from prosecution and penalty
- 23 August 2013 – Case filed in Delhi High Court by CIT (COMMISSIONER OF INCOME TAX (CENTRAL)-II) Against INCOME TAX SETTLEMENT COMMISSION and 1st order issued.
- 10 February, 2014 – Order by Delhi High Court setting aside the immunity from prosecution and penalty on Raheja Developers.
- 8 September 2014 CIT seeks Clarification on Order W.P.(C) 5262/2013 Passed on 10 Feburary 2014
- 17th November 2014 – WP(C) disposed off by Delhi High Court issuing clarifications on its 10 February 2014 order, subject to the final decision of the Honorable Supreme Court in S.L.P. No.17333/2014
- 24 August 2015 – Likely listing date for Raheja Special Leave Petition SLP(C) NO. 17333/2014 against the CIT (ref Order of 10 Feb 2014 of Delhi High Court). The Case was first listed on 30 July 2015 (WITH APPLN. (S) FOR PERMISSION TO PLACE ADDL. DOCUMENTS ON RECORD) and second time on 27 Oct 2014 (WITH APPLN. (S) FOR PERMISSION TO PLACE ADDL. DOCUMENTS ON RECORD AND INTERIM RELIEF AND OFFICE REPORT).