Jhe Vigneshwara group of companies promoted by the Dahiya family started a real estate project in 2005 called “Darsons & Kissons iValley Business Park” in Manesar, Haryana. A rosy image was presented to gullible investors through attractive brochures and advertisements on TV, FM radio and print media that a large computer center comprising offices, retail and residential spaces would be built on approximately ten acres of land.
About 700 gullible homebuyers have been induced by the attractive investment projects thrown at them by the Dahiya family, the promoters of the Vigneshwara group of companies. Developers were able to collect around Rs. 270 crore from homebuyers. Among the various schemes to deceive investors, Vigneshwara’s “barter” scheme “impressed” and pleased me the most due to its cunning and the gullibility of investors to get tricked.
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Let me explain this “barter” system with a simple example. In 2005, Mr. Vinod Sharma, an investor, owned an apartment in Greater Kailash-I worth Rs. 3 crores. Dahiya approaches him and says his company will buy the apartment for Rs. 4 crores and this money received by Sharma will be further invested in buying spaces in “Darsons & Kissons iValley Business Park”. Dahiya promised to give Sharma spaces worth Rs. 4 crores and also an assured monthly return of 1% i.e. Rs. 4 lakh per month till possession. Sharma couldn’t have had a better deal in her life! So he was trapped in this fantastic deal. Sharma received Rs. 50 lakh as partial payment out of the total consideration of Rs. 4 crores and requested to reinvest this amount in Vigneshwara as partial payment for the spaces Sharma made. Fifty lakh was again given by Vigneshwara to Sharma as another installment which was reinvested. In this way, Rs. 50 lakh was shot eight times from Vigneshwara to Sharma and back. Therefore, Sharma received Rs. 4 crores for his apartment in Greater Kailash and the entire amount was reinvested in ‘iValley’ of doom. Dish gone, all money reinvested and gone to Vigneshwara, assured return of Rs. 4 per month paid to Sharma for a few months then abruptly stopped, and ‘iValley’ spaces never delivered. This is how Sharma was “beautifully” tricked. Sharma traded her prized apartment in Greater Kailash for a dream that never came true.
In 2009, Dahiyas sold another dream project called ‘Aquarius’ in Sector 74, Gurgaon to around 900 investors and raised around Rs 320 crore from them. A “dream come true” cyber park including spaces with helipad, etc. was promised by promoters to gullible investors. The farmer who sold the land was only paid Rs. 8 crores, a fraction of the total consideration and driven away. Even the Rs.19 crore payable to the authorities towards EDC has not been paid although Rs. 320 crore has been collected from the investors.
Not a brick was laid and the dream project is still barren land today after 12 years.
The same “barter” plans, etc., were also super hits this time around. The false promises of promoters have kept the hopes of deceived investors alive. Hundreds of crores disappeared from Vigneshwara companies to become shell companies and in personal hands.
The wake up call came around the year 2014 and around 800 criminal complaints were filed by the deceived investors in different police stations including the Economic Offenses Wing (EOW), Delhi. Many FIRs have been recorded against the Dahiyas. Many complaints have been consolidated into FIRs registered with the EOW.
Now let’s come to the point I want to hammer home here. The indictments in the EOW cases were filed by the police in the Delhi court in 2016. Today is the year 2022. And even the arguments to frame the charges have not been heard by the court. In other words, even the first step in a criminal case has not been completed. What to talk about when the criminal trial is likely to end, we do not know when it is likely to begin! Criminal trials in such cases cannot be completed even in the next quarter century. The number of witnesses is so important in these cases of multi-victim scams.
Thousands of witnesses will have to enter the witness box during the trial. Moreover, there would be thousands of documents to show as evidence in such cases. The existing infrastructure in the trial courts simply cannot handle such cases. With so many cases pending, the justice system is totally clogged. A Metropolitan Chief Magistrate in Delhi has about 500 cases before him every day. When dealing with cases like Vigneshwara, the Magistrate is completely helpless! The volume and weight of these files would be intimidating for any judge. The lower judiciary is not to blame, it is the lack of infrastructure.
Let us reflect on the consequences of this difficult situation in our criminal justice system. The defendants believe they face prosecution and persecution. They claim that their right to a speedy trial, which derives from the fundamental right to life and liberty (article 21), is seriously violated.
They are right, especially if they are not released on bail. It would be a travesty of justice to keep the sub-trials in jail indefinitely. This is a strong argument in my eyes. Now let’s look at the other side of the coin from the perspective of the victims of such cases of large-scale cheating. Widows and old people lost their hard-earned money. Many died due to the distress of having been deprived of their life savings. Many victims suffered multiple losses due to the cheating of Vigneshwara’s promoters. They took out loans to invest in attractive schemes on which they pay interest and dreamed of a house that never came true and had to pay hefty rents instead.
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These victims feel that these promoters deserve the harshest sentence, which is a legitimate expectation. After all, justice must be served. Such crimes must never go unpunished. The puzzle is this. If bail is granted to the accused and the criminal trial is postponed indefinitely, this is equivalent to an acquittal for the accused. If bail is denied and the trial does not take place, then beyond a certain point it is a violation of the human right to a fair trial. Therefore, there are arguments in favor of reforms in this area.
In my opinion, special courts must be set up for such multi-victim scam cases to be judged and successful. In other words, special courts must be created to try cases such as Vigneshwara’s. Each special court should have very few cases so that criminal trials in multi-victim cases can be concluded in a maximum of two years. Trials in such cases should proceed on a day-to-day basis. The government, in consultation with the High Courts, must set up special courts for the trial of Vigneshwara and many similar cases that are gathering dust in the courts. While economic justice is dynamic and must continue to evolve over time and new social challenges arise, I must conclude by saying that today, due to the proactiveness and sensitivity of the current government, buyers of the house have ceased to be beggars protesting in the streets for justice or languishing in consumer courts for years and have instead become legally empowered warriors, with RERA and IBC recognizing them as citizens with strong legal rights and remedies.
This excerpt from “Progress of the Indian Economy – Legislative Proactivism Since 2015” by Vivek Sood is published with permission from Thomson Reuters.