Tuesday, 8 September 2015

How Builders Hijack Redevelopment Projects -- step by step

Dirty Tricks of Developers, Managing Committees and Project Management Consultants

Mumbai, 8 September 2015: Some residents of a cooperative housing society in Mulund have painstakingly documented step-by-step how builders, project management consultants and society office bearers work together to hijack the flats of even intelligent and educated flat-owners, and hand them over to third parties. In a letter sent to Municipal Commissioner Ajoy Mehta last week, seven residents of Shree Gurukrupa Nagar Co-operative Housing Society Limited on Nahur village road have alleged that their society's Secretary and other managing committee members have abused their power and influence to confer the society’s development rights on a business entity called “Concrete Siresukan Realty LLP” which did not even bid in the society’s tender. “Neither this LLP nor its designated partners, Mr Anuj Desai and Mr Nilesh Dalal, participated in the tender/bidding for the society’s redevelopment project. 
"Concrete Siresukan Realty LLP was a non-existent entity at the time when development rights were conferred on it, and neither the LLP nor its designated partners, had carried out any correspondence with and/or made any written proposals to our society before their unilateral selection by the managing committee without any reference to the general body,” says the letter written by a group of residents led by Mrs Amisha Atul Gandhi, a chartered accountant who works for Reliance. The group has sought a meeting with the municipal commissioner so that they can explain their case with documentary evidence of financial irregularities. 

The letter goes on to add, “The financial credentials of this LLP are still unverified by us or by our society... The partners of “Concrete Siresukan Realty LLP”, supported by our society's managing committee, persistently refuse to provide copies of any documents showing their financial and technical capability for undertaking our society's redevelopment project, valued at Rs 89 crore by the stamp duty registrar. Sir, our Fundamental Right To Life and Liberty are gravely jeopardized because our homes are placed in the hands of persons and parties whose identities and antecedents are unverified, and whose locus standi in the matter of our society’s redevelopment is highly questionable.”
Read the full text of the letter received by the Municipal Commissioner’s office on Friday afternoon:  http://tinyurl.com/Gurukrupa-Letter-MCGM  
The members of Shree Gurukrupa Nagar Cooperative Housing Society, Nahur, Mulund, allege that the modus operandi was to endow the development rights on one Mr Bharat Talesara (Jain), who then went on to become a nominal partner in Concrete Siresukan Realty LLP with 9% share allocated to him in respect of the development rights, which is given accounting treatment as if it is his asset. Although the “Redevelopment Directives” issued by the Maharashtra Government on 3rd January 2009 (popularly called 79A Guidelines) forbid such transfer of redevelopment projects, the paper-trail confirms the transfer of this asset from Mr jain to Mr Anuj Desai and Mr Nilesh Dalal, through the instrumentality of “Concrete Siresukan Realty LLP”. CA Amisha Gandhi explains, “The bidder who wrote a proposal for our society's redevelopment was 'Mr Bharat Talesara (Jain), partner of Sire Sukan Realty (Group of Siresukan Companies)'. But our society awarded the redevelopment contract to 'Concrete Siresukan Realty LLP', belonging to Concrete Group of Mr Anuj Desai and Mr Nilesh Dalal. 'Sire Sukan Realty' and 'Concrete Siresukan Realty LLP' are two separate legal entities, having similar names to create confusion. The main thing is that our society's redevelopment project was sold off by Mr Bharat Talesara Jain to Mr Anuj Desai and Mr Nilesh Dalal, in collusion with our society's managing committee and the Project Management Consultant.
Image:  http://bit.ly/1JOZgSB

The society members allege that the modus operandi was to endow the development rights on one Mr Bharat Talesara (Jain), who then went on to become a nominal partner in M/s. Concrete Siresukan Realty LLP with 9% share allocated to him in respect of the development rights, which is given accounting treatment as if it is his asset. Although the “Redevelopment Directives” issued by the Maharashtra Government on 3rd January 2009 (popularly called 79A Guidelines) forbid such transfer of redevelopment projects, the paper-trail confirms the transfer of this asset from Mr jain to Mr Anuj Desai and Mr Nilesh Dalal, through the instrumentality of “Concrete Siresukan Realty LLP”.

CA Amisha Gandhi explains, “The bidder who wrote a proposal for our society's redevelopment was 'Mr Bharat Talesara (Jain), partner of Sire Sukan Realty (Group of Siresukan Companies)'. But our society awarded the redevelopment contract to 'Concrete Siresukan Realty LLP', belonging to Concrete Group of Mr Anuj Desai and Mr Nilesh Dalal. 'Sire Sukan Realty' and 'Concrete Siresukan Realty LLP' are two separate legal entities, having similar names to create confusion in the minds of people. The main thing is that our society's redevelopment project was sold off by Mr Bharat Talesara to Mr Anuj Desai and Mr Nilesh Dalal, in collusion with our society's managing committee and the Project Management Consultant. In my opinion, our development agreement is clearly a void contract, which cannot be enforced in any court of law.”

Pritesh Gosar, who is a businessman, says, “Over and above this, our development agreement has many other shortcomings that can cause huge issues in future. It is based on some documents that are forged and fabricated. For that matter, even M/s. Sire Sukan Realty and Mr Bharat Talesara (the bidding entities) are completely unknown to the society, and there is no record on paper as to their financial history and the projects they have completed.”

Of the 72 flat-owners of Shree Gurukrupa Nagar CHS, those questioning this dubious deal constitute roughly 10%. While their numerical strength is considered insufficient to oppose the redevelopment project in court, the clear documentary proofs of financial irregularities should set alarm-bells ringing, and should make the government and judiciary sit up and take notice. “Even a majority cannot make an illegality legal, and convert lies into truth,” says CA Amisha.
The documents suggest that employees of the Building Proposal Department Eastern Suburbs, cooperation department, the society’s secretary Mr Sanjay Jadhav and the society’s project management consultant Mr Atul Mehta -- are all part of a clever scheme masterminded by the builders.

From an outsider’s perspective, it is quite amazing how easily the financial illiteracy of society members has been exploited to pass a series of “general body resolutions” and create documents that endow the society’s development rights on persons and business entities who did not even write a single letter to the society, let alone bid for the redevelopment. All the contractual documents that have been created avoid mentioning PAN numbers, CIN numbers, registered address etc. of the various parties shown as the selected developer; by contrast, on the society’s side, each and every detail is mentioned. Strange? Yes, strange, but convenient for the builders who can slip in and out of partnership firms like clothes.

“Concrete Siresukan Realty LLP did not even exist when our managing committee unilaterally conferred development rights on it on 27th May 2014,” says Pandharinath Rajeshirke, a tutor and life coach. “The LLP firm was incorporated on 14th July 2014, and even its name was approved only on 9th June 2014. Its liability is limited to only its one lakh rupees share capital.” Rajeshirke is deeply uncomfortable with the society's policy of secrecy. “We have written many letters to the society's managing committee, asking them to be transparent with us. We have asked them to share necessary documents to show that the parties they have selected as builders have financial and technical capability to undertake our society's redevelopment project, which is valued at Rs 89 crore by the Registrar of Stamp Duty. But our managing committee and the builders have bluntly refused. They will one day demolish our houses, and we cannot even ask them to prove with documents that they are capable of rebuilding it?” Rajeshirke asks angrily.

Step-by-step – How the Redevelopment Project was captured and sold

1)      On 30 April 2014, the Secretary gave notice of a meeting to be held on 24 May 2014, wherein a builder would be appointed. Ten days were given for members to submit “sealed tender bids” from a developer who was “personally known to him”. The sealed tenders would be opened on 11 May 2014 by the PMC, and then evaluated and rated. See http://tinyurl.com/1-notice-of-meeting

2)       On 22 May, the PMC recommended M/s. Sire Sukan Realty. See http://tinyurl.com/2-PMC-recommends

3)      On 23 May, “Sire Sukan Realty (Group of Sire Sukan Companies)” submitted a revised offer, supposedly based on some additional information received from the Society management after the tender bidding. It was signed by Bharat Talesara (Jain) “for SireSukan Realty”. See http://tinyurl.com/Siresukan-revised-offer

4)      On 24 May, the selection meeting was held. At this meeting, general body members signed a document dated 25 May, stating that they had unanimously approved “M/s. Sire Sukan Realty Partner Mr Bharatbhai Jain Talesara Developer in consultation with PMC”. http://tinyurl.com/General-Body-selects

5)      On 25 May, the society’s Secretary and Chairman gave a Letter Of Intent (LOI) to “Sire Sukan Realty, (Group of Sire Sukan Companies), Shri Bharat Talesara (Jain) (Partner)”. See http://tinyurl.com/LOI-to-Siresukan

6)      On 27 May, the minutes of the meeting of 24 May was circulated. It said that “the PMC recommended M/s. Concrete Siresukan Realty LLP” and the committee approved this LLP as Developer for redevelopment of the society building. This came out of the blue; the society had not received any correspondence from Concrete Siresukan Realty LLP. See http://tinyurl.com/Minutes-say-LLP

7)      The society received correspondence from Concrete Siresukan Realty LLP for the first time on 30 June 2015, over one year later. This letterhead reveals that the LLP belongs to “Concrete Group” belonging to Mr Anuj Desai and Mr Nilesh Dalal. It does not belong to “Group of Sire Sukan Companies” owned by Mr Bharat Jain. See http://tinyurl.com/Concrete-Group-Letterhead

8)      The correspondence of Concrete Group with the Registrar of LLP reveals that as of 1 July 2014, Concrete Siresukan Realty LLP had not yet been granted registration, and even the name was approved on 9 June 2014.  It also shows that Mr Anuj Desai and Mr Nilesh Dalal are “regular partners of the LLP, and they will contribute towards capital as well as provide all future funding for completion of the Project.” Whereas Mr Bharat Talesara “shall be a limited partner, and shall provide non-monetary contribution by facilitating and providing the business prospect comprising the said project”. Towards this, Mr Bharat Talesara will be given a 9% share in profits of the LLP. See http://tinyurl.com/Bharat-9-percent-partner


CONTACT DETAILS FOR JOURNALISTS:

a) Complainants
·        Ms Amisha Atul Gandhi --  99675 97719, amishaatul2004@yahoo.com
·        Mr Pritesh Gosar – 99879 08929, pritesh.gosar@gmail.com
·        Mr Pandarinath Rajeshirke – 93248 33735 / 97694 33735, pandharinathrajeshirke511@gmail.com 

b) Builders / Developers
·        Mr Bharat Talesara/Jain – 99201 16588, siresukan@siresukan.in
·        Mr Anuj Desai – 022-6576 6838 / 2682 3108, anuj@concretegroup.in
·        Mr Nilesh Dalal – 022-6576 6838 / 2682 3108, nilesh@concretegroup.in

c) Project Management Consultant
·        Mr Atul Mehta – 98211 17826, 022-25682107, atulmehta17@gmail.com

d) Society Office Bearers
·        Mr Sanjay Jadhav, Secretary – 98213 68477
·        Mr Anil Shah, Chairman – 98206 27795

e) Municipal Corporation
·        Municipal Commissioner, MCGM – 022 2262 0525
·        MCGM Building Proposal Dept. (Eastern Suburbs), Deputy Chief Engineer – 022-25782182

WHAT THE OTHER SIDE SAYS:
The above named builders, PMC and society office bearers were contacted, but they refused to comment.

ISSUED IN PUBLIC INTEREST BY
Krishnaraj Rao
Journalist and Activist
9821588114
Mumbai

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