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Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

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Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

Last updated: August 14 2020
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  • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

    More than 100 homebuyers, who had invested in Jaycee Homes’ ‘Bhagtani Riyo’ project are left high and dry. The project was pre-launched in 2013 and around 500 buyers had made payments to the tune of 30-50 percent of the cost of their homes. The buyers claim the developer had promised that if the construction did not take place within 12-18 months they would have their money refunded with a 15 percent interest. The project is yet to take off and the buyers see no signs of a refund. “The prices at which homes were offered to us were quite attractive along with the 15 percent interest on refund in case of delay in starting the project. Accordingly, we made around 30 percent payments but the developer did not keep his end of the bargain. We approached the developer after 18 months and at that time he said he has no money and offered us a transfer option,” says Parthiv Jethi, a buyer who had booked an apartment in the Bhagtani Riyo project in 2013. Ashok Verman, a retired Air India employee who had also invested in the project, says that this delay has caused him a lot of mental stress. “I am staying in a rented apartment. I had invested my post-retirement savings in this project. But it’s been 5 years that I am waiting to get what was promised to me,” says Verman. As the project was pre-launched the builder did not have any approved plans. This trend was very much prevalent in the pre-RERA era. In this particular case, the builder had given buyers a provisional allotment letter. The buyers were termed as ‘investors’ in the letter. A particular clause in the letter states that it is an understanding between the developer and investor; therefore, it will not be covered under Maharashtra Ownership of Flats Act or MOFA. When we visited the project site we found that there is absolutely no trace of any construction. In fact, the developer has not been able to even acquire the land from the landlord who has barricaded the property for trespassers. But interestingly this project is still advertised on some of the leading property portals. Dipesh Bhagtani, Executive Director of Jaycee Homes, agreed that they have still not been able to get the ownership of the land and termed the delay as unfortunate. “This land was a joint venture between us and Shivshakti Mandal. Unfortunately, they were not able to get the requisite permissions and, therefore, we were not able to start the work,” says Bhagtani. He further added, “Like any other real estate company we are facing cash flow problems and, therefore, are not able to re-pay our investors. We request our investors to stand by us as we work hard to ensure that they get their money back. We hope this is possible in the next 6-8 months. We are also offering them transfer solution and around 80 customers have already accepted transfer in other Jaycee Homes projects”. Legal experts say that the buyers should weigh the transfer option very carefully before going ahead with it. “Buyers should first check if the new project that is now offered to them is RERA registered and whether the developer will give them the compensation for this long wait,” says Vinay Singh, Advocate, AK Legal, Partners. Meanwhile, some of the buyers who had approached Maharashtra RERA to file the complaint against the developer for non-registration of the project were asked to wait until September 30. “Maha RERA said that the complaints about non-registration will be entertained only after September 30. This is the second time the authority has asked us to wait with regards to this case,” says Godfrey Pimenta, an advocate who is representing some of the Bhagtani Riyo buyers.

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    • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

      https://thebravepedestrian.blogspot.in/2017/09/bhagtani-riyo-investors-get-second.html

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      • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

        25th September, 2017, Mumbai: Good news for Bhagtani Riyo flat-purchasers. Our Adv. Shraddha Dubepatil mentioned our case before Justice Revati Mohite
        Last edited September 25 2017, 10:31 PM.

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        • Getmoneyback
          Getmoneyback commented
          Editing a comment
          Congrats ...nearly 200 interveners ..wow..that is unity..

        • Getmoneyback
          Getmoneyback commented
          Editing a comment
          Wonder if people are going to visit the Mumbai HC on Friday.

      • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

        Case Hearing this Friday on Bhagtani Cheating scheme
        Last edited September 29 2017, 01:15 AM.

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        • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

          Bombay HC Order: Slap in Face for Bhagtani Builders, Relief for Riyo Project Victims

          Mumbai, 29th September, 2017: The hopes of hundreds of victims of Bhagtani builders ill-fated Riyo project in Mira Road today when Justice Revati Mohite Dere of Bombay High Court gave a strict order requiring Dipesh, Mukesh and Lakshman Bhagtani to pay back Rs 22 crore to the victims within 6 months, as a pre-condition for their anticipatory bail.

          Click here to read today's order in Criminal Anticipatory Bail Application no. 1553 of 2017, wherein there were roughly 175 interveners in four Criminal Applications (CA no. 862, 882, 901 and 910 of 2017).



          MAIN POINTS IN TODAY'S ORDER:

          1) Counsel for Bhagtani builders was forced to undertake that (a) the builders will deposit Rs.22 crores (as per the judge's directions on 15th Sept), in 6 equal installments, within six months from today (b) that the first installment will be deposited on or before 12th October, 2017 and (c) the balance 5 installments, thereafter, within one month each and (d) if there is a single default, the protection can be vacated. (e) An affidavit-cum-undertaking of the Bhagtanis stating the above is to be submitted on Tuesday, 3rd October.

          [Note: (i) This figure of Rs 22 crore is inclusive of the dues of 53 allottees (not 78 as mentioned in my earlier blog) whose names were handed over by Adv. Shraddha Dubepatil to Bhagtanis counsel on Monday, 18th Sept. (ii) We believe that this figure is a total of amounts mentioned in allotment letters i.e. principal amounts. It may not include the interest. Our counsel will seek clarification on Tuesday.]
          2) One of the counsels for interveners pointed out that in addition to the above-mentioned list given by the police Investigating Officer, there were other 18 investors, and that he was in the process of filing an intervention application. Their amount would be an additional Rs.3-4 crores.

          [Note: Our counsel Shrey Fatarpekar also mentioned the 30 allottees listed in Adv. Ankur Pahade's list to the judge. As they are not mentioned in the order, we will have to seek clarity about whether they will be included in the court's list for settlement under this present order, or whether their names will have to be sent by our advocates to Economic Offences Wing (EOW) for a list to be drawn up, as orally instructed by the court today. Dozens of intervenors whose cases are being handled by other counsels are in the same situation, since those counsels failed to turn up.]

          3) Mr Mundargi (counsel for Bhagtani builders) stated that the builders were ready to deposit the additional amount of the additional investors who are not included in the list tendered by him today, after the list and the amounts are verified.
          4) The matter is now "stood over" to 3rd October, 2017 at 3.00 p.m, for tendering the affidavit-cum-undertaking of the applicants.
          5) Interim protection (i.e. protection from arrest) granted earlier to continue till the next date i.e. 13th October.



          IMPORTANT POINTS MENTIONED ORALLY IN TODAY'S PROCEEDINGS:

          a) The Investigating Officer said in response to a question that Dipesh and Mukesh Bhagtani are in India. (Dipesh was on the court premises, it seems, though not in the courtroom. The whereabouts of Lakshman Bhagtani were not discussed.)

          b) With reference to another another anticipatory bail application (ABA no. 1725 of 2017) filed yesterday by Bhagtani builders for protection in the case of an FIR u/s IPC sections 420, 120(B) and 34, and MOFA sections 3, 4, 5, 6, 13 and 14, Justice Mohite Dere asked why multiple agencies (i.e. Santa Cruz police station and EOW) were involved in filing FIRs on the same topic. Hence, EOW is directed to take all cases in this matter (i.e. Riyo in particular, and Bhagtani builders in general). Aggrieved Bhagtani investors, in future, please go to EOW and register FIRs.

          c) Those who are in Adv. Shraddha Dubepatil's list of allottees are directed to not deposit any Post Dated Cheques (PDCs)that may be in their possession. Otherwise, it will be seen as trying to take double payment from Bhagtanis.

          --------------------------------------------------------------------------------

          THE BIG MESSAGE FROM TODAY'S PROCEEDINGS: Many FIRs have been registered by Bhagtani's victims, and they will come up before Bombay High Court soon. The Bhagtani scam will now make headlines, and the tide will turn against them and in favour of their victims. Bhagtani victims from Sapphire, Savannah, Serenity and other projects should now gather courage to go and file FIR immediately with EOW. Join the tidal wave of Bhagtani victims fighting for their rights!

          https://thebravepedestrian.blogspot....63165102327320

          ​​​​​​​Court case attached
          Attached Files

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          • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

            So many criminal complaints piling up against this builder. Who in their right mind will ever invest with Jaycee Homes!

            Comment


            • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

              Many thanks for updates on this and thebravepedestrian blog. Let's hope builder keeps up to courts order to deposite 22 crores in next 6 months. This is the right time to fight back for other Bhagtani victims from Sapphire, Savannah, Serenity and other projects. Please file EOW and fight for your right. This fraud builder and hist team must be taught a lesson.
              Attached Files

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              • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

                Great to see the High court ruling in favour of the investors.

                The real relief would be when the investors finally get their money back.

                Let's hope the Bhagtanis pay the monies as scheduled or else they will surely land in Jail like the Sahara Chairman.

                Since Sahara is still trying his best to dodge the Supreme Court and avoid Jail at the same time, I have a feeling Bhagtanis would still play more games mainly to delay the payment and keep earning interest on investors money. This might drag for couple of years.. But nevertheless a ray of hope for investors !!
                Last edited September 30 2017, 06:44 PM.

                Comment


                • hr2011
                  hr2011 commented
                  Editing a comment
                  You are right buddy. They might try some more tricks but if court continues to support investors they will get their money at some point. Let's see how it goes ahead. Good news is, investors from other projects are now actively coming forward to lodge a FIR. It would be interesting to see what happens when cases against Bhagtani piles up and crores of scam is exposed.

              • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

                Interest on refunds from errant builders results in tax burden

                Getting Refunds Classed As Capital Gain Can Cut Tax Outgo: Experts

                Buyers of residential properties who have been refunded their booking amount plus interest by errant builders, on shelving of the project, find themselves grappling with income-tax nuances.

                In most cases, buyers find that they have to pay I-T at the applicable slab on this interest component. Those having a taxable income of Rs 10 lakh or more fall in the highest tax slab, where the tax rate is 30% plus applicable cess and sur charge--the highest tax rate is 35.53%. Many buyers, especially in metros, who book flats in upper-middle and high-end real estate projects, tend to fall in the 30% tax bracket. A properly worded negoated settlement with the tiated settlement with the buyer, say tax experts, can help minimise the outgo. In recent times, the Supreme Court and several high courts have come to the rescue of investors who have booked flats in projects that were delayed for years, with no sign of completion in sight. Additionally , several errant builders, prior to coming into force of The Real Estate Regulatory Authority Act (RERA), have refunded the down payments plus interest to the buyers.

                These buyers may have got back their initial invest got back their initial investment and also interest as a compensation but they aren't uncorking the bubbly . “A few friends and I had booked flats in a prominent project in Mumbai. After a delay of nearly six years, the builder recently refunded my deposit aggregating to Rs 1 crore and paid simple interest at 12%.The interest payout is not in tandem with the capital appreciation the flat we would have obtained. Lastly , the I-T liability in my hands on the interest component at 30% is an added sting. To add insult to injury , the errant builder will be able to claim this interest payout as a business deduction and reduce his taxable profits,“ says a buyer. “Under a negotiated settlement with the builder, it may be possible to characterise the sums received as a `capital gain' with a lower tax rate of 20% and other benefits,“ says Anil Harish, an advocate specialising in real estate. Those hoping to avail of I-T deductions under sections 54 or 54F on investments in a new house, now find themselves at a complete loss. If they don't get possession of the new house, these claims will be denied.

                The tax consequences under various scenarios are analysed below.

                Negotiated settlement with builder

                If the document is properly worded, the sums received from the builder could be classified as a capital gain, which would result in a lower tax outgo for the buyer.

                “A `transfer' of a capital asset results in a capital gain. The definition of `transfer' in section 2(47) of the I-T Act is wide. It also includes `the extinguishment of any rights in a capital asset'. At the time of booking, the buyer acquires a right in the ownership of the flat. When he settles with the builder he is extinguishing this right. Thus, the amount paid to him is characterised as sale proceeds of the capital asset,“ explains Harish. “The sale proceeds so received, less the indexed cost, in the case of a long term capital asset, would be a long-term capital gain (LTCG), which attracts a lower I-T rate of 20% plus surcharge and cess,“ he adds. In our illustration (see table), the buyer gave a depo sit of Rs 5 lakh and in addition to a refund of this amount, the builder paid interest at 12% for eight years (or Rs 4.80 lakh). After indexation, which is an inflation adjustment to the deposit amount by applying the relevant cost inflation index (CII), the I-T on LTCG works out to Rs 12,216.

                On the other hand if the settlement agreement is not properly drafted, while refund of the deposit of Rs 5 lakh would be treated as nontaxable (it is return of one's own money and in technical parlance it is a capital receipt), there would be an I-T levy on the entire interest component of Rs 4.80 lakh. At a rate of 30% this works out to a steep Rs 1.44 lakh.

                In the past, the assessee had to hold an immovable property for three years in order for it to result in long-term capital gains. This holding period is now reduced to two years. In case of refunds by the builder, the holding period will be considered from the date of booking and initial payment by the buyer up to the date of the settlement agreement with the builder. Harish adds, “This long-term capital gain can then be invested in eligible bonds under section 54EC or the sale proceeds can be invested in another new house, under section 54F to further reduce the I-T outgo.“

                Interest paid in cases of dispute

                To safeguard buyers, RERA requires the builder to pay interest at 2% above SBI's marginal lending rate, which currently works out to 10.15%.

                “Such interest will be part of taxable income and I-T at the applicable slab rate, say 30% plus applicable cess and surcharge, will have to be paid,“ says Ameet Patel, tax partner at Manohar Chowdhry & Associates “It could be provided that such interest would be on a net of tax basis (i.e: tax would have to be borne by the builder, by grossing up of the sum payable),“ explains Gautam Nayak, tax partner at CNK & Associates. “Or to mitigate this burden, the government could consider an amendment that instead of an interest component, a premium based on a stipulated rate of return would be paid to the buyer. This premium will be treated as capital gain,“ adds Nayak.

                Loss of I-T benefit on investments in new house

                Various provisions of the I-T Act grant a tax benefit when LTCGs arising on sale of certain assets (eg: house, land, commercial property) are invested in acquiring a new house.

                To the extent of investment in the new house, the LTGCs are reduced and only the balance amount is taxable. Tax tribunals have taken a lenient view and tax benefits have not been denied in case of a delay in possession of the new house beyond the stipulated period of two years from sale of the original asset. “However, as things currently stand, when there is a closure of a project and refund of the advances paid, the buyer may also lose the capital gains exemption that he has claimed under sections 54 or 54F of the I-T Act for investment in a new house,“ says Nayak.







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                • Re : Bhagtani Riyo, Jaycee Homes, Mira Road, Mumbai

                  Some brokers are saying that buider is planning a pre-launch in Kurla in the next few weeks, offering rates upto 30% discount to market.

                  Comment


                  • hr2011
                    hr2011 commented
                    Editing a comment
                    Another scheme to get new victims. I hope people think twice before giving single penny to these frauds.
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