As per case facts, Primezone Developers, involved in construction, faced financial difficulties, leading Mr. Ranjeev Agarwal to invest and assume control. Subsequently, it was alleged that Mr. Agarwal had laundered ...
No Acts & Articles mentioned in this case
sns/sbw 1-apeal-337-2026+-J.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
CRIMINAL APPELLATE JURISDICTION
CRIMINAL APPEAL NO.337 OF 2026
Primezone Developers Private
Limited, A Company registered
under the Companies Act 1956
Having its registered office at 109-
110, Main Market Sector-8, Urban
Estate Karnal Haryana 132001. … Appellant
V/s.
1. State of Maharashtra, through
Public Prosecutor, H.C.A.S. Bombay.
2. Competent Authority under MPID
Act, Mumbai, Having its office at 3
rd
floor, D.D. Building, Old Custom
House, Mumbai 400 001.
3. Economic Offence Wing,
through Senior Police Inspector,
Unit-V, Crime Branch, Mumbai
400 001.
4. Quiker Realty Ltd.
Ramon House, 169, Backbay
Reclamation, HT Parekh Marg,
Churchgate, Mumbai 400 002.
5. Rudraveerya Developers Limited
a company registered under the
Companies Act 1956, and having its
registered office at 375, Third Floor,
Block – B, Plot No.7, Vardhman Grand,
Plaza, Mangalam Place, Near M2K,
Sector-3, Rohini, New Delhi. … Respondents
WITH
INTERIM APPLICATION NO.2323 OF 2025
IN
CRIMINAL APPEAL NO.337 OF 2026
1/73
SUMEDH
NAMDEO
SONAWANE
Digitally
signed by
SUMEDH
NAMDEO
SONAWANE
Date:
2026.05.08
16:07:33
+0530
sns/sbw 1-apeal-337-2026+-J.doc
Rudraveerya Developers Limited
a company registered under the
Companies Act 1956, and having its
registered office at 375, Third Floor,
Block – B, Plot No.7, Vardhman Grand,
Plaza, Mangalam Place, Near M2K,
Sector-3, Rohini, New Delhi. … Applicant
In the matter of:
Primezone Developers Private
Limited, A Company registered
under the Companies Act 1956
Having its registered office at 109-
110, Main Market Sector-8, Urban
Estate Karnal Haryana 132001. … Appellant
V/s.
1. State of Maharashtra,
Through Public Prosecutor, H.C.
Appellate Side Bombay.
2. The Competent Authority
under MPID Act, Mumbai,
having its office at 3
rd
floor,
D.D. Building, Old Custom House,
Mumbai 400 001.
3. Economic Offence Wing,
through Senior Police Inspector,
Unit-V, Crime Branch, Mumbai
400 001.
4. Quiker Realty Ltd.
Ramon House, 169, Backbay
Reclamation, HT Parekh Marg,
Churchgate, Mumbai 400 002.
5. Rudraveerya Developers Limited
a company registered under the
Companies Act 1956, and having its
registered office at 375, Third Floor,
Block – B, Plot No.7, Vardhman Grand,
Plaza, Mangalam Place, Near M2K,
Sector-3, Rohini, New Delhi. … Respondents
2/73
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WITH
INTERIM APPLICATION NO.2469 OF 2023
IN
CRIMINAL APPEAL NO.337 OF 2026
Primezone Developers Private
Limited, A Company registered
under the Companies Act 1956
Having its registered office at 109-
110, Main Market Sector-8, Urban
Estate Karnal Haryana 132001. … Applicant
V/s.
1. The State of Maharashtra,
through Public Prosecutor,
High Court, Bombay.
2. Competent Authority,
MPID Act, having its office at 3
rd
floor, DD Building, Old Custom
House, Mumbai 400 001.
3. Economic Offence Wing,
through Senior Police Inspector,
Unit-V, Crime Branch, Mumbai
400 001.
4. Rudraveerya Developers Limited
A Company registered under the
Companies Act 1956,
having registered office
at 375, TF Block-B, Plot No.7,
Vardhaman Grand Plaza,
Mangalam Place, Near M2K, Sector-3,
Rohini, New Delhi.
5. Mrs. Jaiwanti w/o. Sh. Roshan Lal,
Aged: 32 years, House No.1089-78/2,
Basant Vihar, District- Karnal- 132001.
6. Mr. Satya Narain Shastri S/o.
Sh. Nanak Chand, Aged: 52 years,
House No.375, Ward No.5, Assandh,
District Karnal – 132001.
3/73
sns/sbw 1-apeal-337-2026+-J.doc
7. Mr. Surinder Kumar S/o.
Sh. Sewa Ram, Aged: 31 years,
Mahabir, Electronics, Ward No.13,
Dairy Mohalla, Tarori,
District Karnal – 132001.
8. Mr. Suresh Kumar S/o.
Sewa Ram, Aged: 42 years, Mahabir,
Electronics, Ward No.13, Dairy Mohalla,
Tarori, District Karnal – 132001.
9. Mr. Rakesh Kumar S/o Sh. Chander
Bhan Virmani, Aged: 39 years,
House No. 2088, Sector 7, U.E.,
District Karnal – 132001.
Through General Power of Attorney
Mr. Munish Kumar Ahuja S/o Sh. Jagdish
Lal Ahuja, 72A, Near F.C.I, Ram Nagar,
Karnal – 132001
10. Mr. Roshan Lal S/o Sh. Nanak
Chand, Aged: 63 years,
House No. 1069-78/2(10),
Basant Vihar, Karnal – 132001
11. Mrs. Meenakshi, W/o Dr. Rajesh
Kumar, Aged: 49 years, C/O om
Hospital Ram Nagar, Assandh,
District Karnal – 132001.
12. Mr. Munish Kumar, S/o Inder Singh,
Aged: 29 years, House No. 154,
M.C. Colony, Near Rohtak Road,
Bhiwani 127021.
13. Mr. Sayed Zafer Ali, S/o Sh. Syed
Zahid Ali, Aged: 49 years,
Village – Phaphrana, Tehsil-Assandh,
District Karnal – 132001.
14. Ms. Ranjana Bhalla, W/o Sh. Somnath
Bhalla, Aged: 52 years, House No. 65,
Ward No. 7, Tehsil-Assandh,
District Karnal – 132001.
15. Mr. Jatinder Singh, Aged: 39 years,
House No. 228, Thambu, Village & P.O.
4/73
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Jaishinghpura, Tehsil: Assandh,
District Karnal – 132001.
16. Mr. Vijay Kumar Gaur, S/o
Sh. Krishan Dev, Aged: 30 years,
Vivekananda Vidya Niketan,
Kaithal Road, Assandh,
District Karnal – 132001.
17. Mr. Mahabir Sharma, S/o
Sh. Nanak Chand, Aged: 69 years,
House No. 7, Ward No. 5, Assandh,
District Karnal – 132001.
18. Mr. Harpreet Singh, S/o
Sh. Nirmal Singh, Aged: 49 years,
Flat No. G-6, Plot No. 22, New
Aadarsh Apartment, Sector 10,
Dwarka, New Delhi – 110075.
19. Mrs. Maya Devi, W/o
Sh. Subhash Chander, Aged: 59 years,
House No. 29, village Goli,
Block-4, Tehsil- Assandh,
District Karnal – 132001.
20. Mr. Mastan Singh, S/o Tarlok Singh,
Aged:40 years, House No. 48,
Village Malakpur, Block No. 3, Tehsil,
Saffidon, District Jind, (Haryana).
21. Mr. Raghbir Singh, S/o
Aged: 32 years,
Sh. Amar Singh, Village and P.O. Jalmana,
Tehsil Assandh, District Karnal – 132001.
22. Mr. Aakash Chauhan, S/o Ram
Swaroop Chauhan, Aged: 49 years,
having address at House No. 844,
Sheesh Mahal, Kot Mohalla,
Karnal – 132001.
23. Dr. Dharamveer Singh, Aged: 52 years,
having address at House No.55,
Block No. 41, Village P.O. Theh Bahari,
District Kaithal, Haryana.
5/73
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24. Mr. Surinder Kumar, Aged:49 years,
having address @ Ward 5,
Near Ganesh Mandir, Assandh,
District Karnal 132001.
25. Mr. Sandeep Turan, Aged: 49 years,
having address at village and P.O. Popda,
Tehsil Assandh, District Karnal – 132001.
26. Mr. Sarwan Kumar, Aged: 32 years,
having address at Ward No. 12,
Assandh, District Karnal – 132001.
27. Mr. Vijay Pal, Aged: 49 years,
having address at H. No. 41,
Village Chochra, Block No.2, Assandh,
District Karnal – 132001.
28. Naresh Chaudhary, Aged 49 years,
having address at village Bazid
Roran, Bazida, Roran (16),
District Karnal – 132001.
29. Mr. Netrapal, Aged: 47 years,
having address at House No. 106,
Ward No. 4, Chopre Wali Gali, Assandh,
District Karnal – 132001.
30. Mr. Mahinder Singh, (Deceased)
through LR Karampal S/o Late Sh. Mohinder
Singh, having address at House No.88,
Ward No. 12, Malikpur Road, Assandh,
District Karnal – 132039.
31. Mr. Munesh Kumar, Aged: 27 years,
having address @ Civil Hospital, Assandh,
District Karnal – 132001.
32. Mr. Ghanshyam Dass Garg,
Aged: 27 years, having address at H. No. 195,
Ward No. 13, Geeta Colony, Assandh,
District Karnal – 132001.
33. Ms. Amarjeet Kaur, Aged: 59 years,
having address at House No. 56, Ward No.9,
Dr. Bansal Wali Gali, Assandh,
District Karnal – 132001.
6/73
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34. Ms. Meena Rani, Aged: 49 years,
Address at House No. 217,
Ward No. 5, Assandh,
District Karnal – 132001
35. Mrs. Devender kaur, Aged: 42 years,
Santokh Singh, House No. 55,
village & P.O. Khanda Kheri(83), Assandh,
District Karnal – 132001.
36. Mr. Raj Kumar Chhabra, Aged 69 years,
having address at House No. 145-L,
Model Town, Karnal – 132001.
37. Jagdish Singh, Aged: 49 years,
having address at V.P.O. New Jinda,
Tehsil Assandh, District- Karnal.
38. Ms. Mamta Chahal, Aged: 49 years,
having address at HAFED Sugar Mill,
Village, Phaphrana, Assandh,
Karnal, Haryana.
39. Union Bank of India,
A body corporate constituted
under the Banking Companies
(Acquisition & transfer of undertakings
Act V, 1970) and having head Office
at 239, Vidhan Bhavan Marg, Back Bay
Reclamation, Nariman Point,
Mumbai 400021 and branch
officer at Karnal Haryana Branch having
address at SCO 11, Sector 9, Urban Estate,
Karnal Haryana 132001.
40. National Spot Exchange Limited,
A Company incorporated under
Companies Act 1956 having its registered
officer at FT Towers, Suren Road,
Andheri (E) Mumbai 400093.
41. Quiker Realty Ltd.
Ramon House 169, Back boy Reclamation,
H.T Parekh Marg,
Churchgate, Mumbai 400020. … Respondents
7/73
sns/sbw 1-apeal-337-2026+-J.doc
WITH
INTERIM APPLICATION NO.1166 OF 2026
IN
CRIMINAL APPEAL NO.337 OF 2026
Primezone Developers Private
Limited, A company registered
under the Companies Act 1956
Having its registered office at
109-110, Main Market Sector -8,
Urban Estate, Karnal Haryana 132001. … Applicant
V/s.
1. The State of Maharashtra
through Public Prosecutor,
High Court A.S. Bombay.
2. Competent Authority,
MPID Act, having its office at 3
rd
floor,
DD Building, Old Custom House,
Mumbai 400001.
3. Economic Offence Wing,
through Senior Police Inspector,
Unit- V, Crime Branch,
Mumbai 400001.
4. Quiker Realty Ltd.
Ramon House, 169, Backbay
Reclamation, HT Parekh Marg,
Churchgate, Mumbai 400002. … Respondents
WITH
INTERIM APPLICATION NO.1330 OF 2026
IN
CRIMINAL APPEAL NO.337 OF 2026
Rudraveerya Developers Limited
a company registered under the
8/73
sns/sbw 1-apeal-337-2026+-J.doc
Companies Act 1956, and having its
registered office at 375, Third Floor,
Block – B, Plot No. 7, Vardhaman Grand,
Plaza, Mangalam Place, Near M2K,
Sector – 3, Rohini, New Delhi. … Applicant
In the matter of:-
Primezone Developers Private
Limited, A Company registered
under the Companies Act 1956
Having its registered office at 109-
10, Main Market Sector-8, Urban
Estate, Karnal Haryana 132001. ….Appellant
V/s.
1. The State of Maharashtra
Through Public Prosecutor H.C
Appellate Side Bombay.
2. Competent Authority
under MPID Act, Mumbai,
having its office at 3
rd
Floor,
D.D. Building, Old Custom House,
Mumbai-400001
3. Economic Offence Wing
through Senior Police
Inspector, Unit- V, Crime
Branch, Mumbai 400001.
4. Quiker Realty Ltd.
Ramon House, 169,
Backbay Reclamation, HT
Parekh Marg, Churchgate,
Mumbai – 400002. … Respondents
9/73
sns/sbw 1-apeal-337-2026+-J.doc
WITH
CRIMINAL APPEAL NO.633 OF 2022
Union Bank of India,
A body corporate constituted under
Banking Companies (Acquisition &
Transfer of undertakings) Act, 1970
Having its Registered office at Union
Bank Bhavan, 239, Vidhan Bhavan Marg,
Nariman Point, Mumbai- 400 021
Maharashtra. India.
Having its branch office at
ASA Ram Market, Model Town.
Karnal, Haryana -132001.
Through Mr. Sanjay Kumar
S/o. Kedar Prasad, presently
at Mumbai – Chief Manager. … Appellant
V/s.
1. The State of Maharashtra
through Economic Offenses Wing
EOW Crime Branch, New Building,
3
rd
Floor, Near Crawford Market,
Commissioner office compound,
Mumbai- 400001.
2. The Deputy Collector & Competent
Authority (NSEL)
The Deputy Collector (Land Acquisition),
Mumbai City, and The Competent
Authority appointed under MPID Act,
Having office address at 3
rd
Floor,
MPID branch. Old Custom House,
Fort, Mumbai -400001.
3. National Spot Exchange Limited
Having its corporate/registered office at
6
th
floor. Chintamani Plaza.
Chakala, Andheri-Kurla Road,
Andheri(East), Mumbai 4000 099. … Respondents
10/73
sns/sbw 1-apeal-337-2026+-J.doc
WITH
CRIMINAL APPEAL NO.932 OF 2022
1. Mrs. Jaiwanti W/o
Sh. Roshan Lal, Aged: 42 years,
House No. 1089-78/2, Basant Vihar,
District Karnal – 132001.
2. Mr. Satya Narain Shastri
S/o Sh. Nanak Chand, Aged: 65 Years,
House No. 375, Ward No. 5, Assandh,
District Karnal – 132001.
3. Mr. Surinder Kumar
S/o Sh. Sewa Ram, Aged: 51 years,
Mahabir Electronics, Ward No. 13,
Diary Mohalla, Tarori,
District Karnal – 132001.
4. Mr. Suresh Kumar S/o
Sh. Sewa Ram, Aged: 48 years,
Mahabir Electronics, Ward No. 13,
Dairy Mohalla, Tarori,
District Karnal – 132001.
5. Mr. Rakesh Kumar S/o
Sh. Chander Bhan Virmani,
House No. 2088, Sector -7, U.E.,
District Karnal – 132001.
Through General Power of
Attorney Mr. Munish Kumar
Ahuja S/o Sh. Jagdish Lal
Ahuja, Aged: 37 years,
72A, Near F.C.I, Ram
Nagar, Karnal- 132001
6. Mr. Roshan Lal S/o
Sh. Nanak Chand, Aged: 47 years,
House No. 1069-78/2(10), Basant
Vihar, Karnal- 132001.
7. Mrs. Meenakshi W/o
Dr. Rajesh Kumar, Aged: 39 years,
11/73
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Co. Om Hospital Ram Nagar, Assandh,
District Karnal – 132001.
8. Mr. Munish Kumar S/o Sh. Inder
Singh, Aged: 37 years, House
No. 154, M.C. Colony, Near
Rohtak Road, Bhiwani- 127021.
9. Mr. Sayed Zafer Ali S/o Sh. Syed
Zahid Ali, Aged 52 years,
Village – Phaphrana,
Tehsil – Assandh,
District Karnal – 132001.
10. Ms. Ranjana Bhalla W/o
Sh. Somnath Bhalla, Aged: 56 years,
House No. 65, Ward No.7,
Tehsil Assandh,
District Karnal – 132001.
11. Ms. Jatinder Singh S/o
Sh. Randhir Singh, Aged: 32 years,
House No. 228, Thambu,
Village & P.O. Jaishinghpura,
Tehsil : Assandh,
District Karnal – 132001.
12. Mr. Vijay Kumar Gaur S/o
Sh. Krishan Dev, Aged: 52 years,
C/o Vivekananda Vidya Niketan,
Kaithal Road, Assandh,
District Karnal – 132001.
13. Mr. Mahabir Sharma S/o
Sh. Nanak Chand, Aged: 53 years,
House No. 7, Ward No. 5, Assandh,
District Karnal – 132001.
14. Mr. Harpreet Singh S/o
Sh. Nirmal Singh, Aged: 45 years,
Flat No. G-6, Plot No. 22,
New Aadarsh Apartment,
Sector – 10, Dwarka,
12/73
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New Delhi -110075.
15. Mrs. Maya Devi W/o
Sh. Subhash Chander, Aged: 62 years,
House No. 29, Village – Goli,
Block 4, Tehsil- Assandh,
District Karnal – 132001.
16. Mr. Mastan Singh S/o
Sh. Tarlok singh, Aged: 63 years,
House No. 48, Village Malakpur,
Block No. 3, Tehsil: Saffidon,
District. Jind (Haryana).
17. Mr. Raghbir Singh, S/o
Sh. Amar Singh, Aged: 52 years,
Village and P.O. Jalmana,
Tehsil – Assandh,
District Karnal – 132001.
18. Mr. Aakash Chauhan S/o
Sh. Ram Swaroop Chauhan,
Aged: 28 years, House No. 844,
Sheesh Mahal, Kot Mohalla, Karnal 132001,
19. Dr. Dharamveer Singh S/o
Devata Ram, Aged: 40 years,
House No.55, Block No.41,
Village P.O. ThehBahari,
District Kaithal Haryana.
20. Mr. Surinder Kumar S/o
Sh. Nanak Chand, Aged: 45 years,
Ward No.5, Near Ganesh Mandir,
Assandh, District Karnal – 132001.
21. Mr. Sandeep Turan S/o
Sh. Satya Pal, Aged: 42 years,
Village and P.O. Popda,
Tahsil : Assandh,
District Karnal – 132001.
22. Mr. Sarwan Kumar S/o
13/73
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Sh. Madan Lal, Aged: 48 years,
Ward No. 12, Assandh,
District Karnal – 132001.
23. Mr. Vijay Pal S/o Sh. Prithi,
Aged: 42 years, H.No. 41, Village
Chochra, Block No.2,
Tehsil: Assandh,
District Karnal – 132001.
24. Mr. Naresh Chaudhary S/o
Sh. Bir Singh, Aged: 34 years,
Village: Bazid Roran,
Bazida Roran (16)
District Karnal – 132001.
25. Mr. Nerapal S/o Sh. Mam
Chand, Aged: 38 years,
House No. 106, Ward No.4,
Chopre Wali Gali, Assandh,
District Karnal – 132001.
26. Mr. Mahinder Singh (Deceased)
Aged: 38 years, through LR Karampal
S/o Lata Sh. Mohinder Singh,
House No.88, Ward No. 12,
Malikpur Road, Assandh,
District Karnal – 132039.
27. Mr. Munesh Kumar S/o
Sh. Brij Bhushan, Aged: 46 years,
C/O Civil Hospital, Assandh,
District Karnal – 132001.
28. Mr. Ghanshyam Dass Garg S/o
Sh. Ram Kumar, Aged: 52 years,
H.No. 195, Ward No. 13,
Geeta Colony, Assandh,
District Karnal – 132001.
29. Ms. Amarjeet Kaur W/o
Sh. Virender Singh, Aged: 39 years,
House No. 56, Ward No.9,
Dr. Bansal Wali Gali, Assandh,
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District Karnal – 132001.
30. Ms. Meena Rani D/o
Sh. Gian Chand, Aged: 38 years,
House No. 217, Ward No.5,
Assandh, District Karnal – 132001.
31. Mrs. Devender Kaur W/o
Santokh Singh, Aged: 61 years,
House No.55, Village & P.O.
Khandakheri (83),
Tehsil : Assandh,
District Karnal – 132001.
32. Mr. Raj Kumar Chhabra S/o
Sh. Sai Dass Chhabra, Aged: 61 years,
House No. 145-L, Model Town,
Karnal- 1321001.
33. Sh. Jagdish Singh S/o
Sh. Mohar Singh, Aged: 48 years,
V.P.O. New Jinda,
Tahsil Assandh,
District- Karnal.
34. Ms. Mamta Chahal D/o
Sh. Balwan Singh, Aged: 33 years,
C/O HAFED Sugar Mill,
Village, Phaphrana,
Assandh, Karnal, Haryana. … Appellants
V/s.
1. Competent Authority under MPID
Act, Mumbai, having its office at 3
rd
floor, D.D. Building, Old Custom
House, Mumbai 400 001.
2. Economic Offence Wing,
through Senior Police Inspector,
Unit-V, Crime Branch, Mumbai
400 001.
15/73
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4. Prime Zone Developers Private
Limited, A Company registered
under the Companies Act 1956
Having its registered office at 109-
110, Main Market Sector-8, Urban
Estate Karnal Haryana 132001.
5. Rudraveerya Developers Limited
a company registered under the
Companies Act 1956, and having its
registered office at 375, Third Floor,
Block – B, Plot No.7, Vardhman Grand,
Plaza, Mangalam Place, Near M2K,
Sector-3, Rohini, New Delhi.
6. Sub-Registrar/Tehsildar,
Tehsil Assandh, District Karnal,
State- Haryana.
7. The State of Maharashtra … Respondent
WITH
INTERIM APPLICATION NO.720 OF 2021
IN
CRIMINAL APPEAL NO.932 OF 2022
1. Mrs. Jaiwanti W/o
Sh. Roshan Lal, Aged: 42 years,
House No. 1089-78/2, Basant Vihar,
District Karnal – 132001.
2. Mr. Satya Narain Shastri S/o
Sh. Nanak Chand, Aged: 65 years,
House No. 375, Ward No. 5, Assandh,
District Karnal – 132001.
3. Mr. Surinder Kumar S/o
Sh. Sewa Ram, Aged: 51 years,
Mahabir Electronics, Ward No. 13,
Dairy Mohalla, Tarori,
District Karnal – 132001.
16/73
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4. Mr. Suresh Kumar S/o
Sh. Sewa Ram, Aged: 48 years,
Mahabir Electronics, Ward No. 13,
Dairy Mohalla, Tarori,
District Karnal – 132001.
5. Mr. Rakesh Kumar S/o
Sh. Chander Bhan Virmani,
House No. 2088, Sector -7, U.E.,
District Karnal – 132001
Nagar, Karnal- 132001.
6. Mr. Roshan Lal S/o
Sh. Nanak Chand, Aged: 47 years,
House No. 1069-78/2(10), Basant
Vihar, Karnal- 132001.
7. Mrs. Meenakshi W/o
Dr. Rajesh Kumar, Aged: 38 years,
Om Hospital Ram Nagar, Assandh,
District Karnal – 132001.
8. Mr. Munish Kumar S/o Sh. Inder
Singh, Aged: 37 years, House
No. 154, M.C. Colony, Near
Rohtak Road, Bhiwani- 127021.
9. Mr. Sayed Zafer Ali S/o
Sh. Syed Zahid Ali, Aged: 42 years,
Village – Phaphrana,
Tehsil – Assandh,
District Karnal – 132001.
10. Ms. Ranjana Bhalla W/o
Sh. Somnath Bhalla, Aged: 56 years,
House No. 65, Ward No. 7,
Tehsil -Assandh,
District Karnal – 132001.
11. Mr. Jatinder Singh S/o
Sh. Randhir Singh, Aged: 32 years,
House No. 228, Thambu,
Village & P.O. Jaishinghpura,
17/73
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Tehsil : Assandh,
District Karnal – 132001.
12. Mr. Vijay Kumar Gaur S/o
Sh. Krishan Dev, Aged: 52 years,
C/O Vivekananda Vidya Niketan,
Kaithal Road, Assandh,
District Karnal – 132001.
13. Mr. Mahabir Sharma S/O
Sh. Nanak Chand, Aged: 53 years,
House No. 7, Ward No. 5, Assandh,
District Karnal – 132001.
14. Mr. Harpreet Singh S/o
Sh. Nirmal Singh, Aged: 45 years,
Flat No. G-6, Plot No. 22,
New Aadarsh Apartment,
Sector – 10, Dwarka,
New Delhi -11075.
15. Mrs. Maya Devi W/o
Sh. Subhash Chander, Aged: 62 years,
House No. 29, Village – Goli,
Block 4, Tehsil- Assandh,
District Karnal – 132001.
16. Mr. Mastan Singh S/o
Sh. Tarlok Singh, Aged: 63 years,
House No. 48, Village
Malakpur, Block No. 3,
Tehsil: Saffidon,
District Jind (Haryana).
17. Mr. Raghbir Singh S/o
Sh. Amar Singh, Aged: 52 years,
Village and P.O. Jalmana,
Tehsil – Assandh,
District Karnal – 132001.
18. Mr. Aakash Chauhan S/o
Sh. Ram Swaroop Chauhan,
Aged: 28 years, House No. 844,
18/73
sns/sbw 1-apeal-337-2026+-J.doc
Sheesh Mahal, Kot Mohalla,
District Karnal – 132001.
19. Dr. Dharamveer Singh S/o
Devata Ram, Aged: 40 years,
House No.55, Block No.41,
Village P.O. ThehBahari
District- Kaithal Haryana.
20. Mr. Surinder Kumar S/o
Sh. Nanak Chand, Aged: 45 years,
Ward No. 5, Near Ganesh
Mandir, Assandh,
District Karnal – 132001.
21. Mr. Sandeep Turan S/o
Sh. Satya Pal, Aged: 42 years,
Village and P. O. Popda,
Tehsil : Assandh,
District Karnal – 132001.
22. Mr. Sarwan Kumar S/o
Sh. Madan Lal, Aged: 48 years
Ward No.12, Assandh,
District Karnal – 132001.
23. Mr. Vijay Pal S/o Sh. Prithi,
Aged: 42 years, H.No. 41, Village
Chochra, Block No. 2,
Tehsil: Assandh,
District Karnal – 132001.
24. Mr. Naresh Chaudhary S/o
Sh. Bir Singh, Aged: 34 years,
Village: Bazid Roran,
BazidaRoran(16),
District Karnal – 132001.
25. Mr. Netrapal S/o Sh. Mam
Chand, Aged: 38 years,
House No. 106, Ward No.4,
Chopre Wali Gali, Assandh,
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District Karnal – 132001.
26. Mr. Mahinder Singh (Deceased)
Aged: 38 years, through
LR Karampal S/o Late Sh. Mohinder
Singh, House No.88, Ward No.12,
Malikpur Road, Assandh,
District Karnal – 132001.
27. Mr. Munesh Kumar S/o
Sh. Brij Bhushan, Aged: 46 years,
C/O Civil Hospital, Assandh,
District Karnal – 132001.
28. Mr. Ghanshyam Dass Garg S/o
Sh. Ram Kumar, Aged: 52 years,
H.No. 195, Ward No. 13,
Geeta Colony, Assandh,
District Karnal – 132001.
29. Ms. Amarjeet Kaur W/o
Sh. Virender Singh, Aged: 39 years,
House No. 56, Ward No. 9,
Dr. Bansal Wali Gali, Assandh,
District Karnal – 132001.
30. Ms. Meena Rani D/o
Sh. Gian Chand, Aged: 38 years,
House No. 217, Ward No. 5,
Assandh, District Karnal – 132001.
31. Mrs. Devender Kaur W/o
Santokh singh, Aged: 61 years,
House No. 55, Village & P. O.
Khanda Kheri(83)
Tehsil : Assandh,
District Karnal – 132001.
32. Mr. Raj Kumar Chhabra S/o
Sh. Sai Dass Chhabra,
House No. 145-L, Model Town,
Karnal- 132001.
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33. Sh. Jagdish Singh S/o
Sh. Mohar Singh, Aged: 48 years,
V.P.O. New Jinda, Tehsil Assandh,
District – Karnal
34. Ms. Mamta Chahal D/o
Sh. Balwan Singh, Aged: 33 years,
C/O HAFED Sugar Mill,
Village, Phaphrana,
Assandh, Karnal, Haryana. … Appellants
V/s.
1. Competent Authority under MPID
Act, Mumbai, Having its office at 3
rd
floor, D.D. Building, Old Custom
House, Mumbai 400 001.
2. Economic Offence Wing,
through Senior Police Inspector,
Unit-V, Crime Branch, Mumbai
400 001.
4. Prime Zone Developers Private
Limited, A Company registered
under the Companies Act 1956
Having its registered office at 109-
110, Main Market Sector-8, Urban
Estate Karnal Haryana 132001.
5. Rudraveerya Developers Limited
a company registered under the
Companies Act 1956, and having its
registered office at 375, Third Floor,
Block – B, Plot No.7, Vardhman Grand,
Plaza, Mangalam Place, Near M2K,
Sector-3, Rohini, New Delhi.
6. Sub-Registrar/Tehsildar,
Tehsil Assandh, District Karnal,
State- Haryana. … Respondents
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______________________________________
Mr. Arshad Shaikh, Senior Advocate a/w. Mr. Ranjit Agashe, Mr. Rajendra
Jain, Mr. Pranil Lahigade, Mr. Aniket Pardeshi i/by Ms. Vinsha Acharya for
the Appellant in APEAL/337/2026.
Mr. Atul Rajadhyaksha, Senior Advocate a/w. Mr. Avinash Avhad, S.P.P. for
Respondent Nos.1 and 2 in APEAL/337/2026.
Mr. Avinash Avhad, S.P.P. for Respondent No.3 in APEAL/337/2026.
Mr. Avinash Avhad, S.P.P. for Respondent Nos.1 and 2 in APEAL/633/2022.
Mr. Girish Godbole, Senior Advocate a/w. Ms. Pooja Gera, Mr. Vikas Poojary
i/by PDS Legal for Respondent No.5 in APEAL/337/2026.
Mr. Arvind Lakhawat a/w. Mr. Nimeet Sharma, Mr. Vinit Vaidya, Ms. Jalpa
Shah i/by MZM Legal LLP for Respondent No.40-NSEL.
Mr. Munish Kumar i/by Mr. Ninad Muzumdar for the Appellant in
APEAL/932/2022.
Mr. Nainesh Amin i/by N.N. Amin & Co. for the Appellant in
APEAL/633/2022 and for Respondent No.39 in APEAL/337/2026.
_____________________________________________
CORAM : A. S. GADKARI AND
KAMAL KHATA, JJ.
RESERVED ON : 29
th
April, 2026.
PRONOUNCED ON : 8
th
May, 2026
Judgment (Per : Kamal Khata, J) :-
CRIMINAL APPEAL NO.337 OF 2026
1) By this Appeal under Section 11 of the Maharashtra Protection
of Interest of Depositors (In Financial Establishments) Act, 1999 (‘MPID
Act’), the Appellant has impugned Judgment and Order dated 6
th
February,
2018 (“the impugned Order”).
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Brief Facts:
2) The Appellant Primezone Developers Limited (‘Primezone’) is
engaged in construction of residential complexes. The Appellant
commenced construction of a complex named “Prime Residential” at Sector
32, District Karnal, Haryana and “Prime City” at Sector 10, Assandh, District
Karnal, Haryana in the year 2011. The investments for acquiring the
properties were out of the personal incomes of the Directors namely Mr.
Anil Kumar and Mr. Sohan Singh. The Appellant was in need of finances
sometime in the year 2013. One Mr. Ranjeev Agarwal offered to invest. The
Companies Directors on behalf of the Company and Mr. Ranjeev Agarwal
executed various documents including Memorandum of
Understanding/Agreement and Indemnity Bond thereby transferring the
shareholding, management and control of the Appellant Company to Mr.
Ranjeev Agarwal. At this time there were no proceedings under the
Prevention of Money Laundering Act, 2002 and/or MPID Act against Mr.
Ranjeev Agarwal. Mr. Ranjeev Agarwal was appointed Chairman and
Managing Director of the Appellant in December 2012 and thereafter
assumed control of the Appellant. Neither the erstwhile Directors, Mr. Anil
Kumar or Mr. Sohan Singh or the plot/flat purchasers in the residential
project were aware that, the investment brought in by Mr. Ranjeev Agarwal
was tainted. No sooner Mr. Ranjeev Agarwal assumed the control of the
Appellant, not only he but also the erstwhile Directors Mr. Anil Kumar and
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Mr. Sohan Singh were impleaded in the proceedings initiated by the
Enforcement Directorate under Section 3 read with Section 4 of the
Prevention of Money Laundering Act, 2002, before the Special PMLA Court
at Sessions Court, Greater Mumbai. Subsequently, an Attachment Order
came to be passed on 4
th
August, 2014, whereby the two properties “Prime
Residential” and “Prime City” came to be attached.
3) The Appellant was neither made a party to the proceedings nor
served with any Notice of such Attachment. No sooner the erstwhile
Directors came to know about the Order of Attachment, they attempted to
defend and protect the rights of not only the Appellant but also the flat
purchasers in the two properties. Notably, the Directors, Mr. Anil Kumar and
Mr. Sohan Singh are neither named as accused in the FIR in the predicate
offence in MPID Act nor are they charge-sheeted under the predicate
offences registered by EOW, Unit V, Mumbai.
4) Mr. Shaikh, learned senior counsel appearing for Primezone
submitted that, Mr. Ranjeev Agarwal is alleged to have laundered monies as
CFO of Dunar Foods Ltd. and Director of PD Agro Processor Pvt. Ltd. to the
tune of Rs. 31 crores allegedly received from National Spot Exchange
Limited (“NSEL”) in the account of PD Agro Processor Pvt. Ltd. and has
invested the amounts in the Appellant Company. Mr. Ranjeev Agarwal has
vide his statement to the Enforcement Directorate absolved the Directors as
well as the Appellant Company of any role in the tainted transaction
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concerning repayment of monies received from the Trading Cum Clearing
Members of NSEL. He submitted that, the Attachment Order dated 4
th
August, 2014, passed by the Special PMLA Court in case No.4 of 2015 has
been challenged before the PMLA, Appellate Tribunal at New Delhi which is
pending. He submitted that, the Appellate Tribunal has issued Notice. That,
Mr. Ranjeev Agarwal has absconded and thereby the Appellant Company
has been suffering immensely. The erstwhile Directors have removed Mr.
Ranjeev Agarwal from the Appellant Company vide a requisite Board
Resolution.
4.1) Mr. Shaikh submitted that, by the impugned Order dated 6
th
February, 2018, the attachment of the two properties have been made
absolute and the properties vest with the Competent Authority in MPID
Special Case No.1 of 2014. The Appellant after having been made aware of
the impugned Order, had immediately sent Notices to all the Respondents,
through their Advocate’s communication dated 23
rd
July 2020 calling upon
them to desist from taking any further action. In these aforesaid
circumstances, the present Appeal is filed challenging the impugned Order.
4.2) Mr. Shaikh raised several objections which are as under:
(i) The Competent Authority did not ensure pasting of the auction
Notice on the Appellant’s property.
(ii) Sections 4 to 7 of the MPID Act would relate to assets acquired by a
financial establishment out of deposits standing in its name, if it were not,
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then, it would be benamidar.
(iii) There is no allegation that, the Appellant Company is a financial
establishment.
(iv) The Appellant’s name is recorded in the land records and persons
participating in the auction cannot secure title over the Appellant’s property.
(v) The two properties are mortgaged with the Bank.
(vi) The monies received by the Appellant are in lieu of the transfer of
shares. If at all the tainted money has to be traced and recovered it could be
through sell of shares and not the Appellant’s properties.
(vii) The Appellant’s properties were purchased out of the personal
incomes of the two Directors Mr. Anil Kumar and Mr. Sohan Singh.
(viii) There was no attachment under Section 8 of the MPID Act.
(ix) The impugned Order is contrary to Rule 9 of MPID Rules.
(x) The rights of homebuyers in the two properties are affected in view of
the said attachments.
4.3) Mr. Shaikh further submitted that, the Appellant’s property has
also been attached under an Order dated 4
th
August, 2014 passed by the
Special Court, Mumbai, in PMLA Case No.4 of 2015. He submitted that, the
said Order has been challenged and the matter is
sub-judice. He submitted
that, the impugned Order was passed without the MPID Court having been
informed about the Attachment Order dated 4
th
August, 2014 and
consequently appears to have been obtained by playing a fraud on the
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Court.
4.4) In view of the above, he submitted that the Appeal be allowed.
5) Mr. Atul Rajadhyaksha, learned senior counsel appearing for
Respondent Nos.1 and 2 raised a preliminary objection to the
maintainability of the Appeal on the ground that, the subject properties
were sold in auction to Respondent No.5 and a Sale Certificate has also
been issued, therefore, the Appellant cannot challenge the Order at such a
belated stage.
5.1) He invited our attention to some facts as under:
(I) Mr. Ranjeev Agarwal was arrested by EOW, Unit V of Mumbai Police
on 21
st
October, 2014 in connection with offence under Sections 120(B),
409, 465, 467, 468, 471, 474, 477(A) of Indian Penal Code, 1860 (‘IPC’)
and Sections 3 and 4 of the MPID Act in Crime No.89 of 2013. From
October 2008 to July 2013, the NSEL allowed 25 members who are named
as accused to trade on the exchange as sellers, these members in
connivance with NSEL traded fictitious stocks by raising fake documents.
When the investments grew substantially, the NSEL failed to honour its
commitments and caused a wrongful loss of approximately Rs.5600 crores
to more than 13,000 investors.
(ii) Mr. Ranjeev Agarwal posed an amount of Rs.633.49 crores to NSEL in
respect of Settlement Account for trading of Paddy. Mr. Ranjeev Agarwal
has siphoned off Rs. 31 crores from PD Agro Processors and utilized it by
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investing in M/s. Prime Zone Developers and M/s. Sky High Infraland Pvt.
Ltd. which were engaged in construction activities.
(iii) The properties of M/s. Prime Zone Developers and M/s. Sky High
Infraland Pvt. Ltd. are attached under the provisions of Section 4 of the
MPID Act. Upon his arrest, he granted consent before the Special Court for
sale of his properties for repayment of the amount due from him. On the
basis of the said undertaking, the MPID Court granted bail by its Order
dated 10
th
November, 2014. He, however, failed to comply with the
undertaking and consequently, the State filed an Application for
cancellation of his bail. The MPID Court cancelled the bail by its Order
dated 20
th
February, 2017. He was again arrested and thereafter, he once
again applied for bail which was granted by the MPID Court on 8
th
November 2019. By the said Order, the Court directed Mr. Ranjeev Agarwal
to comply with the undertaking. Instead of complying with the Order, Mr.
Ranjeev Agarwal filed a Miscellaneous Application bearing No.450 of 2021
for modification of the Order. The Application stated that, he was unable to
comply with the undertaking and conditions, since his properties worth
more than Rs. 40 crores has been seized. The Application was rejected by
Order dated 3
rd
September, 2021.
5.2) Mr. Ranjeev Agarwal filed another Application bearing No.221
of 2021 before the High Court for modification of Order dated 8
th
November, 2018. By the said Application, he furnished an undertaking to
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deposit Rs.2,00,000/- and stated that, he intended to comply with the
undertaking by liquidating the assets of M/s. Prime Zone Developers as well
as his personal properties. He also stated that, he will not take any
objection in the auction process of property belonging to M/s. P.D. Agro
Processor Pvt. Ltd. Since no objection was raised during the hearing the
MPID Court made the attachment of Mr. Ranjeev Agarwal’s properties
absolute under Section 7 of the MPID Act by an Order dated 6
th
February,
2018. The subject properties were sold in auction and purchase by
Rudraveerya Developers Ltd, the Respondent No.5 in Interim Application
No.2323 of 2025. It was later granted a Sale Certificate on 31
st
August,
2020 and accordingly, the subject property stood fully transferred in the
name of Respondent No.5
5.3) Mr. Rajadhyaksha submitted that, it was open for the Appellant
to approach the MPID Court under Section 9 of the MPID Act and to give
security in lieu of such attachment, by depositing the amount of Rs.31
crores that were invested in the Appellant Company by Mr. Ranjeev
Agarwal and seek release of the property.
5.4) He submitted that, the present Appeal challenging the
impugned Order would be an abuse of process, with an intent only to delay
the proceedings, inasmuch as the Appellant has failed to deposit the
amount of Rs.31 crores, invested by Mr. Ranjeev Agarwal in the Appellant
Company. He further submitted that, the Government of Maharashtra had
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appointed Quiker Realty Ltd., the Respondent No.4 in the present Appeal,
as Valuers and Auctioneers for the properties attached in the NSEL case.
5.5) Quiker Realty Ltd. had carried out site inspection of the subject
land admeasuring approximately 35.768 acres located at Assandh Road,
Tehsil Assandh, District Karnal, Haryana. The Valuer used “Valuation by
Income Approach using Discounted Cash Flow” method for valuation of the
subject land. The method of valuation ascertains not only the present worth
but also future benefits of the property after its full development value is
calculated after reducing the total expenditure for the same. As per the said
methodology, the estimated freehold value was assessed at RS.74.74 crores.
The estimated distressed sale value was Rs.56 crores and the circle rate
value was Rs.95 crores. In June, 2020, when Quiker Realty Ltd. was asked
to submit a valuation report in respect of the subject land, the valuation
was done on “As is where is basis”. This method entailed determining the
value by using the direct sales comparison method. The value of the subject
land was determined at Rs.10.41 crores as on 30
th
June, 2020.
5.6) Mr. Rajadhyaksha explained the difference between the two
methods of valuation. In the first method namely, “Valuation by Income
Approach using Discounted Cash Flow” method, the total amount of
auction price is not paid by the auction purchaser and is paid as and when
the property is developed. On the other hand, as per “As is where is basis”
method, the auction purchaser is required to pay the entire auction price at
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the time of signing of the auction purchaser document. He submitted that,
most of the Government auctions, Bank auctions are done “As is where is
basis” method.
5.7) Upon the auction Notice published on 13
th
July, 2020, 4 bids
were received for the purchase of the subject property. Respondent No.5
was declared as the successful bidder. The successful bidder made the entire
payment on 28
th
August, 2020 and the Sale Certificate was issued to them
on 31
st
August 2020.
5.8) Mr. Rajadhyaksha submits that, the Appellant failed to take any
objection before the MPID Court with regard to the valuation of the subject
property. It was only during the oral arguments that, the Appellant
contended that the subject property was worth Rs.60 crores and has been
sold at a meager price of Rs.10 crores. He submitted that, there is no basis
of such contention. He submitted that, although the Appellant claims the
property to be worth more than Rs.60 crores, he has only offered Rs.15
crores to the Government of Maharashtra. In view of the aforesaid he
submits that, the Appeal deserves to be dismissed.
6) Mr. Girish Godbole learned senior counsel for Respondent No.5
submits that, the auction Notice was issued in July 2020 and yet the
Appellant consciously waited until the entire process was completed for
filing the present Appeal. He submitted that, the Appeal only challenges the
Order of absolute Attachment but fails to challenge the auction or the Sale
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Certificate that was issued. The Appeal, therefore, is rendered infructuous.
He invited our attention to the Notary Stamp on the Appeal being dated
18
th
August, 2020 which is before issuance of the Sale Certificate in favour
of Respondent No.5, but the Appeal was lodged only in December 2020
before this Court.
6.1) Mr. Godbole submits that, the Appellant has admitted receipt
of tainted funds as investments in the Company. He invited our attention to
the statements of Mr. Ranjeev Agarwal which is extracted hereinbelow for
ready reference:
“i. “I had an offer to take over a real estate project from one
Shri Anil Kumar Gupta, who was Director and promoter of
M/s. Prime Zone Developers Pvt. Ltd. …………… It was
agreed between us that he would exit from the company and
all shares of the company would be transferred in my name.
The total deal for taking over the project of M/s. Prime Zone
Developers Pvt. Ltd. was approx. Rs. 6 Crores. Between May
2012 to September 2012, an amount of Rs. 31.10 Crores was
transferred from the bank account of M/s. PD Agro
Processors Pvt. Ltd. to the account of Shri Anil Kumar and
then from Shri Anil Kumar to the account of M/s Prime Zone
Developers Pvt. Ltd. ……….
The said funds of Rs. 31.10
Crores diverted to M/s Prime Zone Developers Pvt. Ltd from
M/s PD Agro Processors Pvt. Ltd. were received from NSEL
and were utilised by me to procure the project and to
purchase land from farmers for the project at Assand, District
Karnal.
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ii. “When it was agreed between us that the project of “Prime
City” and consequentially the company M/s Prime Zone
Developers Pvt. Ltd. was to be taken over by me, there was
an urgent need of finances for development of land of the
said project. I convinced Shri Anil Kumar Gupta to become a
member of NSEL and accordingly did all the documentation
with the assistance of Shri Amit Mukherjee. After becoming
member, I effected all the trades to generate around Rs. 7
Crores which were utilised for making payments towards
development expenses. After receipts from M/s. PD Agro
processors Pvt. Ltd., the said amounts were returned back
with interest and NSEL outstanding was nullified. Due to roll
over of trades, the total turnover of the Settlement Account of
Shri Anil Kumar works out to approx. Rs. 40 Crores.”
iii. In his statement, Mr. Anil Kumar has also confirmed the
receipt of monies as above. He has further stated that while
the purchase of 35 Acres of land was contemplated and
consideration amount of Rs. 69.5 Lacs per Acre was to be
paid to the owners within 11 months, the financiers
withdrew from the Project and it was difficult to make
payment to farmers within 11 months due to which he
reached out to Mr. Aggarwal for finance. He further admitted
that funds were received from the account of PD Agro
Processors Pvt. Ltd. to his personal account.
iv. These admissions are directly contrary to what is claimed
in the Appeal. Mr. Sohan Singh and Mr. Anil Kumar have
affirmed the Appeal.”
6.2) Mr. Godbole submitted that, some of the proceeds of crime
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generated in the NSEL scam was deposited in the Appellant Company and
was utilized to pay the consideration for the subject properties. He
accordingly submitted that, the submissions that the subject properties were
acquired by Mr. Anil Kumar and Mr. Sohan Singh through untainted funds
is incorrect. He referred to the decision of the Hon’ble Supreme Court in the
case of
Ravindra Shah vs. State of Maharashtra (SLP (Cr.) Diary No.10560
of 2023)
to explain the scope of attachment under the MPID Act.
6.3) He further submitted that, admittedly an amount of Rs.31
crores was received by the Appellant by diversion of investors’ funds from
M/s. PD Agro Processors Pvt. Ltd. in 2012. He submitted that, the Appellant
offered Rs.15 crores consideration to re-purchase the entire land after 12
years of having admittedly received and utilized the sum of Rs.31 crores.
6.4) Mr. Godbole submitted that, the Appellant had sold plots in the
subject property to homebuyers who filed claims before Competent
Authority. However, no objections were raised by any homebuyer before the
MPID Court and before the auction. He invited our attention to the
dismissal of the Appellant’s Application before the PMLA Appellate
Tribunal, New Delhi. The Application for condonation of delay of 1530 days
came to be dismissed by an Order dated 3
rd
October, 2023 which also
resulted in dismissal of Appeal challenging the Order of Attachment of the
subject property made by Enforcement Directorate vide PAO dated 28
th
February, 2014 confirmed on 4
th
August, 2014. He submitted that, by
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suppression of these facts before this Court, only exhibits the conduct of the
Appellant who has attempted to mislead this Court and consequently, has
approached this Court with unclean hands. He submits that, on this ground
alone the Appeal deserves to be dismissed with costs.
6.5) He further submitted that, the Respondents had acquired rights
in the subject property pursuant to a lawful process under an auction
conducted as per the MPID Act. He invited our attention to some
undisputed facts as under:
“i.
By Notification dated 28.08.2014 published by the Home
Department, Government of Maharashtra under the MPID
Act, the Subject Property was attached in exercise of powers
conferred under Section 4(1) and Section 5(1) of the MPID
Act.
ii. As recorded in the Order of 06.02.2018, on
19.04.2015, an affidavit under Section 5(3) of MPID Act was
filed to make the attachment absolute of the properties
attached under notification dated 28.08.2014. Despite service
of notice, the concerned parties did not appear nor raised
objections. Therefore, in accordance with Section 7(4), the
attachment was made absolute.
iii. On 14.05.2018, a Public Notice for registering claims
was issued.
iv. On 16.11.2018, the first Notice for Auction was issued
with reserve price of Rs. 60 Crores was issued by the Ld.
Competent Authority.
v. Since no bids were received, a second Auction Notice
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was issued on 11.01.2019 with the same reserve price of Rs.
60 Crores.
vi. A third auction Notice was issued on 15.07.2019 for an
open bid auction. No reserve price was mentioned on this
Notice and bid deposit was specified to be Rs. 10 Lacs.
vii. A fourth auction Notice dated 13.07.2020 was issued
with EMD mentioned as Rs. 50,00,000.
viii. The Ld. Competent Authority was informed of receipt
of 4 bids.
ix. The Competent Authority approved the bid of
Rudraveerya Developers as the H1 Bidder and issued the
“Intimation of successful bidder.” On 10.08.2020.
x. On 30.08.2020, a Sale Certificate was issued by the
Competent Authority.
xi. The amount of Rs. 10,09,00,000/- paid by Respondent
No. 5 has been retained by the Ld. Competent Authority.
Additionally, Stamp duty of Rs. 50,54,000 has been paid by
Respondent No. 5
6.6) Mr. Godbole submitted that, the Sale is neither fraudulent nor
collusive and the Appeals do not question the same. He submitted that, the
entire purchase consideration of Rs.10,09,00,000/- has been paid prior to
the issuance of the Sale Certificate. An amount of Rs.50,45,000/- is paid
towards stamp duty and Rs.50,000/- is paid towards registration charges.
He submitted that, upon issuance of Sale Certificate in accordance with the
Order of the MPID Court, the Sale has become final. In support of his
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contention that, upon issuance of Sale Certificate, the Sale is final, he refers
to the Judgment of our High Court in
Lemon Seeds Hospitality Pvt. Ltd. vs.
Union of India & Ors (Writ Petition No.3248 of 2024)
. He relies upon the
decision of the Hon’ble Supreme Court in the case of
State of Punjab & Anr.
vs. M/s. Ferrous Alloy Forgings P. Ltd. & Ors. (Civil Appeal No.12527 of
2024 decided on 19
th
November, 2024)
to submit that, the Sale Certificate
does not require registration under Section 17(1) of the Registration Act.
He submitted that, the said Judgment was followed by this Court in the
cases of
Vishal Laxman Arkal vs. Inspector General of Registration & Ors.
reported in 2025 SCC OnLine Bom 4727 and S. Arvind Kumar vs.
Government of India reported in (2007) 5 SCC 745
.
6.7) Mr. Godbole submitted that, the High Court must not look into
the aspect of valuation after 5 years of completion of auction and issuance
of Sale Certificate inasmuch there was no allegation of fraud or collusion.
He relied upon the Judgments in the cases of
Janak Raj vs. Gurdial Singh
reported in AIR 1967 SC 608 and Janatha Textiles & Ors. vs. Tax Recovery
Officer
reported in (2008) 12 SCC 582, whereby the Court observed that, a
third-party auction purchasers’ interest in the auction property must be
protected even if the underlying decree is set aside or otherwise.
6.8) He submits that, Respondent No.5 is an absolute stranger to
the proceedings and the Sale in his favour must be protected in view of the
aforesaid Judgments. Relying upon a recent Judgment of the Supreme
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Court in
Om Sakthi Sekar vs. V. Sukumar & Ors. (Civil Appeal No.3362 of
2026)
to submit that, the Hon’ble Supreme Court has not deviated from the
aforesaid position of law. He submitted that, the said Judgment observed
that, the Hon’ble High Court had neither set aside the auction sale nor
questioned the participation of the auction purchaser but had confined the
direction to reconsideration of the issue of valuation. Such a limited
direction without disturbing the Sale in favour of the auction purchaser was
found to be legally tenable by the Hon’ble Apex Court. It was specifically
noted that, consideration of issue of valuation did not render the auction
void.
6.9) Mr. Godbole submitted that, the Court must consider the two
parties before it. On the one hand is the auction purchaser who has
acquired rights in the subject property pursuant to a valid Sale conducted
under the MPID Act and on the other hand, the Appellant Company, whose
management was involved in illegal transactions concerning money it
received from NSEL scam. According to him, the present Appeal is nothing
but a belated challenge to an impugned Order dated 6
th
February, 2018, by
which the subject properties attachment was made absolute.
6.10) According to him the contention of the Appellant regarding
their being a gap between the valuation conducted by the Competent
Authority in 2018 vis-a-vis the valuation in 2020 is not only based on
suppression of material facts but is grossly misleading. He submitted that,
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the Appellant has deliberately suppressed that, the gap between the two
valuations that was highlighted by the Appellant being Rs.60 crores in 2018
as against Rs.10 crores in 2020 did not take into account that just a few
months after the first valuation exercise was conducted, the Town and
Country Planning Authority, Haryana, Chandigarh had cancelled the license
bearing license No.120 of 2012 dated 10
th
December 2012 which was
issued in favour of the Appellant for development of a residential plotted
colony over the subject property. Notably, the license was valid upto 9
th
December, 2016 and was required to be renewed, which the Appellant had
failed to do. He pointed out that,
(i) the Valuation Report described the access and connectivity of the
plot as well as marketability. He submitted that, the Report recorded
“Assand is not planned nor is there any residential housing
development like that of neighboring cities like Karnal and Panipat”.
City comprises of population of mostly lower middle class and middle
class projected population of Assand is 1.17 lakhs by the year 2031
compared to the 42,000 as per census 2001
(ii) The Valuation Report of 5
th
May, 2018 specified “current usage” of
the plot to be proposed residential plotted development and applied
the income approach / discounted cash flow method. It presumed
that, the project would generate future cash flows.
6.11) Notably, the license of the Appellant had not been cancelled at
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the time of 2018 valuation. Apparently, the cancellation of the license took
place few months later on 9
th
October, 2018. He submitted that, despite
having the license since 2012, the Appellants only did road mapping on the
subject plot and no other construction activity had been done till the date of
inspection. Thus, at the time of the second valuation, there was no valid
license for the said land.
6.12) Mr. Godbole drew our attention to the fact that, when two
auctions were conducted with the reserve price of Rs.60 crores, the same
yielded no bidders. According to him, it only demonstrated that the earlier
valuation was not aligned with the ground reality. On the other hand, when
the valuation exercise was conducted again in 2020, there was no
subsisting license in favor of the appellant. The methodology adopted by
the Valuer was different. The Valuation Report of 2
nd
July, 2020 specified the
current usage to be agriculture and applied the direct sales approach. The
approach, thus, estimated the value of the subject property by comparing
recent sales / listings of similar interest in the properties located in the
surrounding area. The third Valuation Report submitted on 22
nd
October,
2024 corroborated that, the valuation done in 2020 was apt. The Report
recorded that, the property was a “vacant barren land” and fell within
agricultural land use zone. It applied the sales comparison approach and
arrived at a distress value of Rs.13.2 crores for the said property. It
submitted that, the outstanding dues on the subject land as on 31
st
January
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2019, was Rs.42.15 crore on account of pending EDC dues and that as on
today would certainly be more.
6.13) According to Mr. Godbole, the liabilities were not considered
during the earlier valuation process and notably, the purchaser is required
to bear these additional expenses. He further contended that, the first
valuation by Quiker Reality in May 2018 was incorrect for the following
reasons:
“i. as the
usage of the land was considered’ proposed
residential plotted development’
without substantiating the
status of the license from the DTCP, Haryana.
ii. The report
further failed to consider the liabilities
attached with the land/license,
ignore the master plan zone
usage of the land.
iii. The
usage of the land appearing in the sale deeds (the
only document available with the valuer) and proceeded to
determine the value of the land on the basis of the market
value.
iv. The report hence was a
hypothetical based on
Discounted Cash Flow (DCF) method and was completely
inappropriate.”
6.14) According to Mr. Godbole, a fruitful attempt was made to
determine the fair value of the land on an “As is where is basis” in the
second Valuation Report dated 30
th
June, 2020. The reasons in support of
his contention are as under:
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“i. Valuer
aligned the current usage of the land with the
zoned usage.
ii. the usage of the land (agriculture) shown in the sale
deeds
and determine the value on the basis of circle rate.
iii.
No license was there on the land for development of
the colony as the same was cancelled on 09.10.2018 by the
Director, Town and country Planning, Haryana.
iv. The approach adopted by the valuer i.e. Direct Sale
Approach has led to the realistic value of the land i.e. Rs.
8,39,98,125/- and which led to successful auction of the
land.”
6.15) A fresh valuation in the year 2024 also assesses the property at
Rs.13.2 crore confirming the earlier valuation of 2020 to be realistic and
factually correct. It also demonstrates that, the valuation conducted in 2018
was purely hypothetical and not based on correct facts. In support of the
valuations, he contended that, even from the perspective of the Appellant
and as stated in the Affidavit-in-Reply by the Appellant itself, they had
offered Rs.15 crores towards the property that too in installments. The
amount included other debts and facilities availed of by the Appellant and
not towards the price of the property. He therefore submitted that, the value
offered by the Respondent No.5 was correct in all forms. He accordingly
submitted that, the Appeal deserves to be dismissed.
7) Mr. Lakhawat learned Counsel appearing for Respondent
No.40-NSEL in Interim Application No.2469 of 2023 was also in favor of
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setting aside the Sale. He highlighted that, the earlier auction that was
conducted did not give wide publicity. He submitted that, there was a vast
difference between the first valuation Report done by Quiker and the fourth
Valuation Report, instead of the value rising it had devalued the property.
Even in 2024, the market value was shown to be Rs.21 crores. He drew our
attention to the facts that, Rs.7 crores were claimed by flat buyers, a sum of
Rs.7.45 crores was due towards the bank loan, in addition thereto, the dues
of the Government were to be paid.
7.1) He argued that, the land was contagious and all the Khasara
Numbers were a part of the same contagious land. It, therefore, could not
be contended that, each piece and parcel of the land would have to be
considered and valued separately. He further submitted that, the license for
commercial exploitation of the land could always be renewed and
therefore, the subsequent valuation by Quiker on the basis that the land
was agricultural could not be countenanced. He submitted that, while the
circle rate, namely, the ready reckoner rate was considered for the
valuation, the same would be unrealistic, since the market value of the land
is always higher. He submitted that, save and except in certain parts of the
Country the ready reckoner rates or the circle rate in other parts of the
country would always be lower than the market value. According to him,
therefore, the Court must consider setting aside the sale and re-auctioning
the said property.
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APPEAL NO.633 OF 2022
8) The Appellant-Union Bank of India has preferred the Appeal
seeking to set aside the impugned Order dated 6
th
October, 2021 and to
declare that the attachment levied by the Competent Authority in respect of
the Khasra No.134/18(4-10), 134/19-(8-0), 134/22(8-0), 134/23 (8-2),
166/1/2-(1-9), 166/10-(8-0), 166/12-(8-0), 166/13/1-(5-18), 166/13/2-
(2-2), 166/14-(8-0), 166/19/2 (4-12), 166/2-(8-0),166/23-(8-0), 166/25-
(7-12), 166/3-(8-0), 166/4-(4-0),166/7-(7-10), 166/8-(8-0), 166/9-(8-0),
171/2-(8-0), 171/3-(8-0), 171/4/1(7-18), 171/4/2-(0-2), 171/7/1-(0-
2),171/7/1-(7-18),171/8 (8-0), 171/9-(8-0), 166/15-(5-16), 171/23-(8-0),
134/12/1-(3-4), 165/6-(7-8), 166/17-(8-0), 166/18-(8-0), 166/19/1-(3-8),
166/21/2-(3-4), 166/22-(8-0), 166/24-(8-0), 166/6-(0-15), 166/16-(7-
12), 171/13-(8-0), 171/18-(7-11), 171/24-(8-0), 171/5-(7-12), 171/6-(7-
8) in village Assandh, Tehsil Assandh, District Karnal as per the Notification
dated 28
th
August, 2014 and the subsequent sale under Sale Certificate No.
DC/MPID/NSEL/Sale/Mohan/2020/194 dated 31
st
August, 2020 is invalid.
Alternatively, the Appellant seeks a direction to the Competent Authority to
remit the sale consideration realized from the sale of the mortgaged
property to the Appellant to the extent of its outstanding dues.
8.1) The Appellant had intervened in the Original Application under
Section 7 of the MPID Act.
8.2) The Appellant-Bank had issued Bank Guarantee bearing
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No.66790/GL0000312 dated 24
th
August, 2012 amounting to
Rs.6,71,59,600/- valid upto 23
rd
August, 2016 for external development of
the residential colony on an Application made by Primezone Developers
Pvt. Ltd. (“Primezone”). The Appellant issued another Bank Guarantee
bearing No.66790/GL0000212 dated 24
th
August 2012 for a sum of
Rs.1,88,89,800/- valid upto 23
rd
August, 2016 for internal development of
the residential colony. The Appellant accordingly, has lien on the aforestated
properties, as per the letter of a lien dated 24
th
August, 2012 issued in
favour of the Appellant-Bank. The Appellant-Bank has also furnished to
Primezone a Bank Guarantee limit to the extent of Rs.8.60 crores vide letter
dated 10
th
July, 2013. As a security, Mr. Ranjeev Agarwal and Ms. Savita
Agarwal had executed Demand Promissory Note in favour of the Appellant-
Bank. Additionally, Mr. Anil Kumar, Mr. Sohan Singh, Mr. Ranjeev Agarwal
and Ms. Savita Agarwal had also executed Deed of Guarantee in favour of
the Appellant-Bank. The said Deeds of Guarantee record their personal
liabilities as guarantors in addition to the liability as Directors of the
Company to the Appellant-Bank. The amounts advanced had been secured
by way of mortgage upon deposit of Title Deeds as recorded in
Memorandum of Deposit of Title Deeds dated 17
th
July, 2013. Subsequently,
a Supplementary Memorandum dated 18
th
July, 2013 was executed in
favour of the Appellant-Bank, whereby, the equitable mortgage of lands was
revised.
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8.3) The Appellant-Bank had permitted the encashment of Bank
Guarantees upon receipt of the Notice dated 19
th
August, 2016 from the
Directorate of Town Planning and Country Planning, Haryana Chandigarh.
Upon invocation of these Bank Guarantees, the borrower namely,
Primezone, became liable for repayment of the encashed amount alongwith
further interest thereon as per the Agreement and the Communication in
that regard dated 23
rd
August, 2016.
8.4) The Appellant-Bank recalled the entire outstanding amount
from the borrowers and Guarantors vide its Notice dated 24
th
October 2021.
Upon the borrowers and Guarantors defaulting in repayment of the
outstanding amount, the account of the borrowers were classified as an NPA
on 30
th
November, 2016.
8.5) The Appellant-Bank filed an Original Application bearing
No.4959 of 2017 against the borrowers and Guarantors before the Debt
Recovery Tribunal (‘DRT’), Chandigarh for recovery of a sum of
Rs.7,45,41,044/- on 31
st
July, 2017. Notwithstanding the aforesaid, earlier
in or around April, 2015, the Appellant-Bank had appeared before the
Committee constituted under the Hon’ble Bombay High Court Order dated
2
nd
September, 2014 in Suit No.173 of 2014 and other related Suits. The
Commission, pursuant to the hearing on 26
th
June, 2015, recorded that the
Appellant-Bank had a claim and that in the event of any action being
initiated against the properties against the properties mortgaged with the
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Appellant-Bank, an advance notice will be given to the Bank in that regard.
8.6) Mr. Amin submitted that, the equitable mortgage of the
properties in favour of the Appellant-Bank is still in force and the original
Title Deeds of the mortgaged properties are lying in the custody of the
Appellant-Bank. On 30
th
September, 2020 the Appellant-Bank learnt about
Sale Certificate issued by the Special Court in respect of the mortgage
properties and on 1
st
October, 2020 procured a copy of the Certificate of
Sale. The Certificate of Sale indicated that, properties mortgaged with the
Bank was auctioned by the Collector and District Magistrate, Mumbai City,
MPID Branch, Fort, Mumbai, in favour of one M/s. Rudraveerya Developers
Limited. It also came to know that, auction purchaser had written a letter
dated 31
st
August, 2020 to Sub-Registrar, Tehsil Assandh, District Karnal,
Haryana to register the Certificate of Sale dated 31
st
August, 2020 in its
favour. Upon further inquiries, the Appellant-Bank also learnt that, the
mortgaged properties was attached under the provisions of MPID Act vide
Notification dated 28
th
August, 2014.
8.7) The Appellant-Bank filed their Objections under Section 7 of
the MPID Act to protect the rights qua the mortgaged properties. The
Special Court by its Order dated 6
th
September, 2021 was pleased to Order
and restrain the Deputy Collector & Competent Authority (NSEL) (“DCCA-
NSEL”) from distributing the sale proceeds from the sale of the mortgage
assets until further Orders. The Application of the Appellant-Bank came to
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be rejected by the impugned Order dated 6
th
October, 2021. By the said
Order, the Special Court rejected the Application for extension of the Order
of injunction granted on 6
th
September, 2021, thereby, foreclosing their
attempt to challenge the impugned Order dated 6
th
October 2021. It is in
these circumstances that, the present Appeal was preferred by the
Appellant-Bank.
8.8) Mr. Nainesh Amin narrated the afore-stated facts and submitted
that, impugned Order dated 6
th
October, 2021 is bad in law and deserves to
be set aside. He further contended that, it is trite law that once a mortgage
always a mortgage until redeemed or sold by the secured creditor. He
submitted that, the Special Court failed to consider the fact that, Deputy
Collector and DCCA-NSEL was present before the Hon’ble Committee for
hearing on 26
th
June, 2015 and the fact that, there was a valid mortgage in
favour of the Appellant-Bank. He further submitted that, it was the duty of
Respondent No.2-DCCA-NSEL to display the encumbrances of the
Appellant-Bank and publish the same by way of public Notice in the local
newspapers, which called for claims or persons having interest in the
mortgage properties. According to him, the local newspapers “Ajit” and
“Dainik Jagran” did not display encumbrance of the Appellant-Bank in the
publication done on 25
th
July, 2018.
8.9) He submitted that, having attended the hearing before the
Committee, the DCCA-NSEL had knowledge about Appellant-Bank’s right
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over the subject properties and could not plead ignorance about the same.
He submitted that, by not disclosing the Appellant-Bank rights, the DCCA-
NSEL has perpetuated a fraud on the Special Court.
8.10) He submitted that, the Special Court erred in holding that, the
Appellant-Bank’s Application was not maintainable as an Order of
Attachment was already made absolute in favour of the auction purchaser.
He further submitted that, the Special Court misinterpreted the provisions
of Section 7(4) of the MPID Act. He submitted that, despite the fact that Mr.
Ajit Sakhare, (DCCA-NSEL) had appeared before the Commission on 26
th
June, 2015 and 14
th
July, 2015, he has falsely denied that he was unaware
of the claim of the Appellant-Bank in his Affidavit dated 22
nd
September,
2021. He submitted that, the DCCA-NSEL has attempted to mislead the
Court which cannot countenanced. He further submitted that, the Special
Judge also erred in holding that, no Notice was required to be given to the
Appellant-Bank by the DCCA-NSEL before initiating an auction of the
mortgage properties. It is in these circumstances he submitted that, the
impugned Order dated 6
th
October, 2021 deserves to be set aside.
APPEAL NO.932 OF 2022
9) By this Appeal, the Appellants seek to set aside the impugned
Judgment and Order dated 6
th
February, 2018 passed by the Additional
Sessions Judge in MPID Special Court Sessions, Mumbai. Additionally, the
Appellants seek to remand the matter back to the designated MPID Court
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and direct it to consider the claims of the Appellants. Additionally, they seek
the release of the attachment on the properties purchased by them in the
subject properties of Primezone.
9.1) The Appellants herein are bonafide purchasers of plots of land
offered for sale by Primezone. The Appellants state that, the residential
Complexes known as Prime Residential was one of the first well planned
sector at Assandh, Karnal, Haryana. The Appellants had purchased the plots
in this sector planning to have a family home for themselves. The
Appellants had applied for allotment of plots as per their requirements and
made advance payments for the same. The Appellants have in their
possession the receipts for the payments as well as the allotment letters for
the plots as per their application. The Appellants have exercised due
diligence before booking the plots and are accordingly bonafide purchasers
in this project. The Appellants believed the Project’s viability since the
option of bank loans were available for the purchase. Some of the
Appellants in the Appeal also availed of loans from various nationalized
banks.
9.2) On account of the delay in development of the township, some
Appellants had filed Consumer complaints against the developers before the
Haryana State Consumer Disputes Redressal Commission, Panchkula,
Haryana, which are pending for adjudication. Some Appellants had filed the
Writ Petition bearing No.11008 of 2018 before the High Court of Punjab
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and Haryana and Chandigarh and even sought cancellation of license
bearing No.120 of 2012 dated 10
th
December, 2012 due to the failure of
development of the project known as Prime City, Assandh.
9.3) By an Order dated 3
rd
May, 2018, the concerned Office was
directed to decide the Representation dated 11
th
April, 2018 in accordance
with law. This was directed to be completed within a period of three
months. Apparently, the concerned Office had cancelled the license of
Respondent No.4 Primezone. Subsequently, the Appellants came to know
that one Rudraveerya Developers Ltd. has purchased the property through
auction for an amount of Rs.10,09,00,000/- only. The Appellants, however,
had made payments of Rs.7,01,54,053/- for just 40 plots totaling to around
2.3 acres out of the 35 acres during the period 2011 to 2015 and were
accordingly surprised as to how the entire 35 acres was auctioned for Rs.
10,9,00,000/- only in 2020.
9.4) The Appellants had raised objections to the registration of the
Sale Certificate before the Tahsildar claiming protection of their interests
and rights in the attached property by way of a written complaint to the
office of the Deputy Commissioner, Karnal, Haryana and office of Sub-
Divisional Magistrate, Karnal. The office of Tahsildar informed the
Appellants that, the charge was registered in the name of Enforcement
Directorate in respect of Sector 10, Assandh, Karnal, Haryana i.e. the
subject properties. Thereafter, they came to know that a case bearing MPID
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No.12 of 2014 was pending for adjudication before the Special Judge City
Civil and Sessions Court at Mumbai and that by an Order dated 6
th
February
2018, the attachment of the subject properties was made absolute.
9.5) On 1
st
October, 2020 the Appellants were informed about the
publication in newspapers “Ajit” published in Punjabi language, Chandigarh
Edition and “Dainik Jagran” published in Hindi language in Chandigarh
Edition dated 25
th
July, 2018. The Appellants submitted that, Tehsil,
Assandh, District Karnal, only has circulation of the newspaper “Dainik
Jagran” Panipat Edition and not of Chandigarh Edition. Besides, the
newspaper “Ajit” Chandigarh Edition, being in Punjabi language has very
limited circulation in the Hindi speaking area.
10) Mr. Munish Kumar, learned Advocate appearing for the
Appellants submitted that, the Appellants have neither received any notice
from the Office of the Collector and District Magistrate, Mumbai City, nor
from the Special Judge, MPID, City Civil and Sessions Court, Mumbai,
about the proceedings in respect of the subject properties. The Appellants,
accordingly, were completely unaware that, the Directors of Primezone
were accused in proceedings under PMLA, initiated by the Directorate of
Enforcement, Mumbai. They were also unaware about the Order of
attachment by the Adjudicating Authority under PMLA in Complaint
bearing No.275 of 2014 in Case File No. ECIR/14/MZO/2013.
10.1) He submitted that, only on 26
th
September, 2020, the
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Appellants came to know that Primezone had challenged the Provisional
Attachment Order before the Appellate Tribunal PMLA at New Delhi and
have accordingly taken steps to defend and protect the rights and interest in
the attached properties before the said Tribunal. He submitted that, the
Appellants could not procure any documents from the Authorities due to
lack of
locus standi as well as Covid-19 situations. The Appellants received
the certified copy of the Order dated 6
th
February, 2018 and have
consequently approached this High Court in the present Appeal. He
submitted that, the Orders are passed without notice and/or hearing given
to them. The Appellants are bonafide purchasers and entitled to a hearing.
10.2) He submitted that, the publications made in the two
newspapers “Ajit” (Punjabi) Chandigarh Edition and “Dainik Jagran” in
Punjabi language were deliberate and malafide and consequently, the
Appellants were not aware about the same since the area does not provide
circulation of these papers. Moreover, the local vernacular language is Hindi
and not Punjabi. Consequently, the newspapers have not been circulated in
the area where the property is located and thus the Appellants cannot be
deemed to be aware about the publication of such notice. He therefore
submits that, the publications made by the concerned Competent Authority
DCCA-NSEL are not as per the statute and consequently, does not satisfy the
compliance as required for the auction. He submitted that, in the absence of
lawful procedure being followed, the intent to invite claims of objections
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through the publications could not be fulfilled and the Appellants could not
raise objections pursuant to those publications and accordingly all actions
undertaken on the basis of those publications are non-est and render
nugatory.
10.3) He submitted that, the Appellants would be covered under the
term “Deposit” as per the definition of Section 2(c) of the MPID Act. He
submitted that, the Appellants deserve protection. He submitted that, the
attachment and sale is on the basis of a fraud played by the Authorities on
the Court by contending that due process as contemplated under the
Statute was followed and accordingly, the entire exercise is nothing but an
illusion created to mislead the Court in support of the contention that the
due process was followed before the auction sale was conducted.
10.4) In view of the above, he submits that, the impugned Judgment
and Order dated 6
th
February, 2018 deserves to be set aside and the interest
of the Appellants deserve to be protected.
11) We have heard all the Advocates and have perused the record
carefully.
Reasons and Conclusions:
Valuation and Auction Notices:
12) Under the MPID Act, the legislature intended that, attached
properties are correctly valued, so as to fetch the maximum possible price,
thereby ensuring that the proceeds enure to the benefit of the defrauded
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investors.
12.1) In the present case, however, we find that the Competent
Authority, DCCA-NSEL, which functions in a fiduciary capacity to safeguard
the interest of the investors, has acted contrary to that objective.
13) Two valuation reports dated 5
th
May 2018 and dated 30
th
June
2020 have been prepared.
Valuation of May 2018
14) Upon a closer examination of the 1
st
valuation report, it reveals
that it was prepared on Valuation by income approach using Discounted
Cash Flow Method for a plotted residential development project. The
valuation was based on under-construction residential projects in Karnal
and Assandh. The 1
st
Valuation Report estimated the freehold value of the
subject property at 74.74 crores, the Circle Rate value (Ready Recknor₹
rate) at 95 crores and the distress sale value at 70% of the market value₹
at 56 Crores.₹
15) Based on this valuation, three Auction Notices came to be
issued. First on 16
th
November 2018 which was published in two
newspapers
Dainik Jagran (Hindi) Chandigarh edition and Ajit daily
(Punjabi) Chandigarh edition. The second auction notice issued on 11
th
January 2019 as well as the third notice issued on 15
th
July 2019 were only
put up on Quiker Website.
16) The first Auction notice dated 16
th
November 2018 quoted a
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reserve price of 60 crores and a close bid auction would be conducted.₹
The second too quoted a reserve price of 60 crores. However, the third₹
notice did not mention a reserve price and declared that it would be an
open bid auction. All these attempts were allegedly unsuccessful. However,
we find mischief played by the Competent Authority.
Newspaper Publication:
17) In our view, the newspaper publication of the 1
st
auction notice
in the two newspapers
Ajit and Dainik Jagran for sale of the subject
properties was thoroughly misleading. It appears to have been done merely
to create the impression of wide publicity, despite full knowledge that such
publications would not effectively reach local prospective purchasers who
were Hindi speaking and the Chandigarh edition had limited circulation in
the area where the subject property was located. Notably, the 2
nd
and 3
rd
Public Auction Notices on 11
th
January 2019 and 15
th
July 2019 were
advertised and hosted only on the website of Quiker Realty.
18) Consequently, interested bidders remained unaware of the
auction and naturally no bids were received. It would be plainly dishonest
for the Competent Authority to contend that adequate publication was
made. In our view, this amounts to nothing short of a fraud played upon the
Court.
Valuation of June 2020
19) After an alleged unsuccessful attempt of auction, a 2
nd
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valuation report dated 30
th
June 2020 was prepared. The subject property
was valued at 10,41,98,940/-. ₹
20) Based on this report the fourth auction notice dated 17
th
July
2020 was published again on the website of Quiker Realty only. No reserve
price was quoted and a sealed bid auction was proposed. It is under this 4
th
auction that the subject property was sold and the sale completed by
issuance of a sale certificate in favour of the auction purchaser –
Rudraveerya Developers Ltd. This sale is under challenge.
Errors in Valuation and misclassification
21) We examined the June 2020 valuation report, there was no
justification for suddenly changing the description of the land to an
agricultural land parcel. This itself shows mis-description. Both the
Competent Authority and Quiker Realty knew the land was part of a
residential plotted development project and not agricultural land. This
mischief appears to be ill-intended to reduce the value of the subject
properties to 10 crores. ₹
22) It is evident from the executive summary to the Valuation
Report that, no site inspection was undertaken before preparing the fresh
valuation. We see no reason to treat the subject land as ‘agricultural’ for
valuation purposes. In our view, the valuation report of 2020 rather
deliberately recorded the present use of land as ‘agricultural’ based on
information supplied by the Competent Authority itself. In our view, the
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Competent Authority and Quiker Reality were responsible for the mis-
description and appear to have engineered the sale in favour of a particular
entity i.e. Respondent No.5 herein.
23) We find it impossible to accept that a property initially valued
at Rs.60 crores could subsequently be reduced to Rs.10 crores for an area
measuring approximately 35 acres. Even after considering the explanations
offered by Mr. Rajadhyaksha, learned Senior Counsel for the Competent
Authority, we are unable to accept the same and find several glaring
lacunae in those submissions. We are equally unable to accept the
explanation as to why the property was first valued as a ‘residential
property’ and later as an ‘agricultural property’. It only leads us to an
adverse inference.
24) We are not persuaded by the contention that, at the time of
first valuation in May 2018, the license permitting development of the land
as a ‘residential area’ was valid and subsisting, but that after its lapse, the
land was required to be valued as an ‘agricultural property’. We find this
submission wholly absurd and baseless. Since the subject property had been
valued on the strength of a license for residential development, issued by
the local authority, it could not subsequently be treated as ‘agricultural land’
for valuation purposes. It is undisputed that the land was earmarked for
‘residential development’ and designated as ‘Sector 10’ by the local
Planning Authority. Therefore, the valuation therefore ought to have
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reflected its development potential, rather than the temporary status of
subject property sans the license. We are informed that the license fee
demanded by the local authority was around Rs. 50 crores. If so, it is
natural to infer that such fee was fixed with reference to the substantial
development potential of the land. It is common knowledge that a license
fee is a small percentage of the land cost and its potential.
25) Assuming the licence fee formed part of the basis for the first
valuation of 60 crores, a subsequent valuation of 10 crores would imply₹ ₹
that the licence fee alone was five times the land’s value. Such a proposition
is wholly untenable. A licence fee imposed by a local authority cannot
reasonably exceed the land value by five times. If the property was valued
at Rs 60 crores being a ‘residential area’, even then it is unclear as to
whether the outstanding renewal charges of license was taken into
consideration. In that event too, the land cost for the purchaser would be
around Rs 100 crores. In our view the license fee for a land to be developed
as ‘residential area’ cannot be over or around 50%. It would be exorbitant,
unless the estimated realization from the project is much higher. Notably,
the Appellants (plot purchasers) have paid about 7.01 crores for only 2.3
acres of land which confirms that the lands are sold at an under value.
Consequently, the first valuation itself appears baseless and deserves to be
set aside. Equally, the second valuation is flawed because it reclassified the
property as ‘agricultural land’. On that ground alone, the second valuation
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must also be set aside.
26) We are unable to accept the contention of the Competent
Authority that, property prices depend upon license fees being paid or
unpaid. We are expected to believe that, the subject property is rightly
valued at Rs 10 crores and the license fee for developing it for residential
purposes is about Rs 50 crores. We unhesitatingly reject the contention.
27) A public notice cannot be in a coded language for prospective
buyers to connect the dots. It has to be clear and unambiguous. By no
stretch of imagination, can a license fee be five times the value of the land
itself. License fees are ordinarily only a percentage of the property value.
Neither the Government nor a local authority can claim license fees
amounting to five times the value of the land. The entire argument is
therefore, fallacious and unfounded. It is settled law that, the Court is the
custodian of the interest of the company and its creditors (
Navalkha & Sons
v Ramanya Das
reported in (1969) 3 SCC 537) and it is the duty of the
Court to see that the price fetched at the auction is an adequate price even
though there is no suggestion of irregularity or fraud. (
Divya Manufacturing
Company (P) Ltd. v Union Bank of India
reported in (2000) 6 SCC 69.)
Incorrect Description and location of the Subject Property on the Plan:
28) Mr. Shaikh submitted two plans, one of which correctly showed
the location of the subject properties, while the other plan showing zoning
characteristics and the location advertised on the Quiker Realty website was
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clearly a wrong plan. The subject property was actually within Sector 10,
represented by the semi- rectangular plot, but the star mark incorrectly
indicated the location. When Mr. Rajadhyaksha was confronted with these
plans, he sought time to obtain instructions, which was granted. On the
next date of hearing, Mr. Rajadhyaksha fairly admitted that Mr. Shaikh’s
contention was correct and there had been a misdescription of the property
location on the Quiker website. In our view, this is yet another ground to
invalidate and reject the sale.
29) It is pertinent to note that, Quiker Realty have attempted to
protect itself through clause “x” of its report, which reads as under:
“x. We have valued the property considering the subject
property as an agricultural land as per the sale deed shared
by the client. We were not provided with any change in land
use or any other documents supporting the change of land
use of the property.”
30) We appreciate the fairness of Mr. Rajadhyaksha, who submitted
that the subject properties lies within Sector 10 and that the sketch map
shown in the Valuation Report was erroneous rather incorrect. He fairly
submitted that this error was of material importance and would
significantly affect the subject property valuation.
Lack of Data – Website Reach
31) Upon posing a question to Mr. Rajadhyaksha regarding the
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website’s usual viewership and supporting data, he fairly stated that no
such information was available. We, therefore, granted him time to fetch
the same. Despite being granted to produce the same, he was unable to do
so even on the next date. In the absence of any data, we are unable to draw
any positive inference that the website enjoyed a reasonably large
viewership. We are therefore, compelled to draw an adverse inference that
the website had limited reach and was incapable of attracting adequate
bidders.
Maintainability:-
32) We are unable to accede to the proposition that, the Appeal is
not maintainable merely because a Sale Certificate has been issued
following allegedly a valid auction. It is settled law that fraud vitiates all
acts and conclusions (
S P Chengalvaraya Naidu v Jagannath reported in
and
A V Papayya Sastry v Govt of A.P. reported in (1994) 1 SCC 1). In the
present case, we find that the entire procedure adopted by the Competent
Authority, in collusion with Quiker Realty Ltd., is nothing else, but a fraud
played upon 13,000 investors who are victims in a crime involving a huge
sum of Rs.5600 crores. Additionally and rather unfortunately, this is not an
isolated case in NSEL scam where we find the Competent Authority has
attempted a sale at a gross under valuation. Accordingly, we reject the
preliminary objection regarding maintainability of the Appeal.
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Common Director of two bidders - Brij Gopal Construction and Rudraveerya
Developers Ltd:
33) Record reveals that one Director, namely Rajan Goyal, was a
common director in both bidding companies - Brij Gopal Construction and
Rudraveerya Developers Ltd. We note that, the board resolution of M/s Brij
Gopal Construction Co. Pvt. Ltd. authorised Mr. Rajan Goyal to submit bid
documents, while he was simultaneously a Director of Rudraveerya
Developers. The record shows that Brij Gopal Construction bid
approximately Rs.8 crores, while Rudraveerya bid Rs.10 crores. Notably, the
other two bidders offered less than Rs.5 crores.
34) The aforesaid facts lead us to infer that the Competent
Authority, along with Quiker Realty, contrived a situation that enabled
Rudraveerya to become the successful bidder. In our view, the
advertisements and auction were pre-planned to create an illusion of due
process while being conducted in a manner designed to favour Rudraveerya
Developers Ltd. The notice misrepresented and concealed material facts to
mislead the prospective purchaser. There was no wide publicity, the auction
was conducted through sealed bids and the property was grossly
undervalued. For all these reasons, the auction sale deserves to be set aside.
This amounts to a fraud played upon the State, the Court, and the victims
of the fraud.
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Appellant’s Knowledge:-
35) Considering the conspectus of this case, and the consequences
of confirming the sale of the attached properties at gross under value,
resulting in recovery of a minimal amount and depriving an adequate
return of the invested amounts, we do not restrict our adjudication based
on the Appellant’s knowledge, conduct or the steps taken by them in
challenging the sale of the subject properties. We therefore, relying upon
Popular Muthiah v State reported in (2006) 7 SCC 296 propose to decide
this Appeal in exercise of our inherent and constitutional powers to secure
the ends of justice.
36) We are not setting aside the sale merely because a higher offer
is now available for the said property, but because we have found not only
gross under valuation of property, but also serious discrepancies in arriving
at the valuation of the property. Even though the entire auction price has
been deposited, the stamp duty is paid, and the entire process of sale
formally completed, these facts do not alter our conclusion.
37) The Appellants’ alleged suppression of material facts, delay
beyond the 60-day limitation under Section 11, or arguments regarding
tainted funds do not persuade us otherwise. We are presently concerned
with the fact that the properties were sold at a gross undervalue through
mischievous and mala fide methods, while falsely projecting full statutory
compliance.
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38) We are also not convinced with the argument that certain
creditors with receivables upto Rs.10 lakhs were settled under a scheme of
arrangement. Such payments do not erase the mala fide conduct or
misrepresentation that resulted in fraud upon the State, the Court, and
13,000 investors who were duped in a Rs 5600 crore scam.
Irregularities in Entire Process
39) The entire process was riddled with irregularities-from
publication of notices on websites and newspapers to valuation of the
property and finally the purchase by the successful bidder, Rudraveerya
Developers Ltd.
40) Instead of showcasing and marketing the development
potential of the subject property, the valuation report wrongly weighed
down the property’s value based on the expenses and liabilities that would
fall upon the auction purchasers and by deliberately misclassifying the
property as ‘agricultural land’. The valuation reports ought to have
considered that though the license had already expired in 2016, the same
was renewable.
41) Moreover, the auction was conducted as a closed bid auction
rather than an open auction. Since, the Competent Authority was required
to secure the highest possible price, adopting a closed bid method was
inappropriate. We have no data about the total views for the said auctions
on Quiker Realty’s website. We also find no evidence of wide publicity,
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additionally the incorrect property description and location on the website
of Quiker Realty Ltd., itself would vitiate the process.
42) It is important to note that, the auction notices described the
subject property as a proposed ‘residential Plot development’ and the public
was notified that the sale would remain subject to the Order of the MPID
Court in case No.1 of 2014. Therefore, the auction purchaser cannot claim
that the confirmed sale should not be set aside, as they were fully aware it
was subject to Court Orders.
43) We find no need to examine the October 2024 valuation, as
earlier irregularities are sufficient to set aside the auction sale.
Fraud, Findings and Observations
44) We find that, the Competent Authority has played a fraud not
only upon the State but also upon the Court. Entrusted with the attachment
and sale of properties arising from a scam of 5,600 crores involving over₹
13,000 investors/victims, the Competent Authority owed a duty not merely
to the State and the Court but to the public at large and in particular to the
victims of the crime.
45) We have found that in many cases, the nominated valuer
Quiker Realty, undervalued properties and the Competent Authority
attempted to sell them and in some instances successfully concluded such
sales. In certain matters, we have already set aside those transactions on
account of erroneous valuations.
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46) According to us, this is a scam within the scam. The Competent
Authority bear primary responsibility, and Quiker Realty is equally
complicit. By assisting in undervaluation and facilitating sales to
predetermined entities, they deprived investors of the full realization of
their funds. It appears that the Competent Authority deliberately contrived
circumstances to favour select parties.
47) In the present case, the entire process is fully shrouded with
suspicious circumstances. It suggests bias, favoritism, suspicious
circumstances, undervaluation and underbidding, all of which are
detrimental to legitimate interest of the defrauded investors i.e. the victims
of the crime.
48) The Competent Authority cannot itself become a party to the
scam and perpetuate a fraud upon the State and the Court. Such conduct
warrants serious censure and cannot be countenanced.
49) The Competent Authority has defeated the very purpose of
conducting an auction. Therefore, the auction deserves to be set aside.
Investor Impact
50) It is pertinent to note that the NSEL scam came to light over a
decade ago. Under the proposed scheme, investors/victims have been
offered only 40% of their invested value. From any perspective, this
represents a grave loss. In the ordinary course, invested sums would likely
have appreciated substantially over such a period. Thus, an investor
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receiving 40,000 today against an original investment of 1,00,000₹ ₹
effectively receives only a fraction of the true economic value lost over time.
Timing
51) In our opinion, the entire exercise carried out by the
Competent Authority reflects mala fide intent. There was absolutely no
reason to finalize the sales immediately after the Covid period, when the
Nation was at its weakest economic condition due to the pandemic. It is
common knowledge that the correct market value of land could not have
been realized at that time. The Competent Authority, holding fiduciary
responsibility towards the investors, was expected to act in the victim’s
interests rather than become party to another wrongdoing. They were
expected to act prudently and not sell the properties at their lowest possible
prices.
Rejection of Arguments
52) In our view, the contentions of the auction purchaser as well as
the Competent Authority did not deserve to be considered at all. If their
arguments are accepted, the very object of the MPID Act would be defeated,
and the Courts would appear to be endorsing a large-scale fraud against the
victims. The Court cannot be a party to a such an outcome. We, therefore,
refuse to do so. There are more than sufficient reasons to set aside the sale.
Conduct of Parties
53) Mr. Rajadhyaksha also submitted that, The auction was
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conducted and concluded on the basis of a valuation report now shown to
be incorrect. The earlier reserve price of Rs.60 crores, when bids were
invited in November 2018 and January 2019, failed not because the reserve
price was excessive, but because the auction was not properly publicised in
the local area and remained unknown to the buyers at large.
54) In our view, Quiker Realty abused its position, acted unfairly
and assisted the Competent Authority in undervaluing the properties,
thereby causing enormous loss to the 13,000 investors/victims who were
already deprived of their investments, benefits, and interest.
54.1) Accordingly, we direct the State Government to revoke Quiker
Realty’s approval and take appropriate action to disqualify it from
conducting valuations or public auctions for the Government of
Maharashtra for at least five years.
55) We find that, the Competent Authority is the main culprit in
this sale process. It either knew or in any event ought to have known, that
the license granted to Primezone had expired much earlier on 9
th
December,
2016 and was not renewed. The Competent Authority, therefore, failed in
its duty to act diligently and consider all relevant aspects before valuing and
selling the attached property. This was contrary to the intention of the
Government of Maharashtra, which required strict compliance with
valuation rules while protecting the interests of defrauded investors and
recovering the maximum possible amount.
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56) Mr. Lakhawat submits that, the composition of the Competent
Authority, which conducted the subject auction, has since been altered and
that a new committee is now in place.
57) Be that as it may, we are of the considered view that a further
change in the Competent Authority is warranted. The newly constituted
members have, instead of independently examining the matter, continued
to endorse and support the decisions of their predecessors. In doing so, they
have failed to discharge their duty to adopt a fair and objective stand.
58) In these circumstances, we deem it appropriate that the
present members of the Competent Authority also be replaced, so as to
convey a clear and unequivocal message to the State regarding the
impropriety of the actions of the Competent Authority.
Case Laws and Legal Principles
59) Mr. Godbole in support of his contentions had relied upon the
following Judgments :-
(I)
Ravindra Shah vs. State of Maharashtra (supra).
(II) Lemon Seeds Hospitality Pvt. Ltd. vs. Union of India &
Ors. (supra).
(III) State of Punjab & Anr. Vs. M/s. Ferrous Alloy Forgings P.
Ltd. & Ors. (supra).
(IV) Vishal Laxman Arkal vs. Inspector General of Registration
& Ors. (supra).
(V) B. Arvind Kumar vs. Government of India (supra).
(VI) Janak Raj. vs. Gurdial Singh (supra).
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(VII)
Janatha Textiles & Ors. vs. Tax Recovery Officer (supra).
(VIII)Om Sakthi Sekar vs. V. Sukumar & Ors. (supra).
60) In view of what we have noted above, the Judgments relied
upon by Mr. Godbole will be of no avail to his clients. The facts of the
present case are clearly distinguishable from each of the cases.
61) The judgments relied upon by Mr. Rajadhyaksha arise under
Order XXI of the Civil Procedure Code. They are distinguishable both on
facts and in law. The present Appeal is being considered under the MPID
Act, which operates in a distinctly different legal framework from ordinary
civil proceedings.
62) The Hon’ble Supreme Court in the case of
Golden Food
Products India vs. State of Uttar Pradesh & Ors.
reported in 2026 SCC
onLine SC 2024
in while referring to Eva Agro Feeds (P) Ltd. vs. Punjab
National Bank
reported in (2023) 10 SCC 189, has held that, the
comparison of the valuation of dissimilar plots would be ground for
cancellation of the auction. It referred to another Supreme Court decision in
K. Kumara Gupta vs. Sri Markendaya & Sri Omkareswara Swamy Temple
reported in (2022) 5 SCC 710 where it held that, if it was found that there
is material irregularity and/or illegality in holding the public auction or the
auction was vitiated by any fraud or collusion, it would be open for the
Court to set aside the auction or sale in the favour of the highest bidder
even though their representation was made by third party who even did not
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participate in the auction proceedings or make any offer. Hon’ble Supreme
Court in the case of
Rajiv Kumar Jindal & Ors. vs. BCI Staff Colony
Residential Welfare Association & Ors.
reported in (2023) 238 Comp Case
227
has held that, the purpose of an auction (open or close format) is to get
the most remunerative price and giving opportunity to the intending
bidders to participate and fetch higher realizable value of the property. If
that path is cut down or closed, the possibility of fraud or to secure
inadequate price or underbidding would loom large. In the given
circumstances, it is the duty of the Court to exercise its discretion wisely
and with circumspection and keeping in view the facts and circumstances in
each case.
63) In view of the above, we pass the following common Order in
the above Appeals:-
(a) The State shall appoint a new Competent Authority in the
present case within a period of four weeks from today;
(b) The new Competent Authority shall appoint another valuer
for valuation and sale of the properties attached in the NSEL scam;
(c) The new Competent Authority thereafter conduct fresh
process of auction of property by giving wide publicity in local
newspapers and also on electronic media;
(d) The Sale Certificate dated 31
st
August 2020 is set aside.
However, the attachment shall continue pending the reauction of the
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attached properties;
(e) The amounts received from Rudraveerya Developers Ltd. be
returned within a period of four weeks from the uploading of this
order;
(f) The State to investigate and take appropriate action against
the members of the Competent Authority and the Valuer Quiker
Realty and file a compliance Affidavit after six months of uploading
of this order;
(g) Appeal No.932 of 2022 is accordingly allowed;
(h) Other Appeals are accordingly disposed off in aforesaid
terms;
(i) In view of disposal of Appeals, all connected Interim
Applications do not survive and are accordingly disposed off.
(KAMAL KHATA, J.) (A.S. GADKARI, J.)
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