SC freezes Parsvnath accounts, issues warrants over homebuyers’ plight

The Supreme Court froze the bank accounts of Parsvnath Developers and its directors, issued bailable warrants, and criticised Haryana authorities over alleged failure to enforce RERA orders in a long-pending homebuyers' dispute involving delayed possession of Gurugram flats

New Delhi: In a stinging rebuke of the “brazen disregard” shown by Haryana-based Parsvnath Developers towards homebuyer rights, the Supreme Court on Monday froze the bank accounts of the real estate firm and its directors, and issued bailable warrants against the company’s leadership after taking note of a 20-year struggle by senior citizens to secure possession of their homes.

A bench headed by Chief Justice of India Surya Kant also came down heavily on Haryana authorities for their failure to enforce orders passed by the Haryana Real Estate Regulatory Authority (HRERA) against the real estate firm, saying that the case exposes serious concerns about the effectiveness of the Real Estate (Regulation and Development) Act, 2016, in securing relief for homebuyers.

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The bench, also comprising Justices Joymalya Bagchi and V Mohana, expressed grave concern over the “slumber” of regulatory authorities and suggested a “collusion” between the Haryana state machinery and the builder.

To ensure that the builders do not evade justice, the bench ordered freezing of bank accounts of Parsvnath Hessa Developers Pvt Ltd, Parsvnath Developers Ltd and the personal accounts of their managing directors and directors with immediate effect.

“The bank accounts of Respondent number 2 and 3 companies as well as personal accounts of MDs/ Directors/ officers shall remain frozen till further orders. Since the builders are operating mainly in Haryana, we direct the chief secretary of Haryana, the Director General of Police and all collectors, commissioners, Superintendent of police and all Banks to comply with these directions and submit compliance affidavits,” the bench ordered.

“We are prima facie further satisfied that state authorities, especially the Collector and the local police, are either colluding with the builder or have failed to discharge their official responsibilities,” the CJI observed.

The case pertained to a petition filed by one Rita Tikku, a cancer survivor, and Lokaish Tikku, who invested their life savings in the “Parsvnath Exotica” project in Sector 53, Gurugram. Taking note of the plea, the bench issued notices to the state government, Parsvnath Hessa Developers Pvt Ltd through its managing director, Parsvnath Developers Pvt Ltd, the district magistrate of Gurugram and Haryana’s Department of Town Country Planning.

It asked the Haryana chief secretary, the DGP, all district collectors and police commissioners to ensure strict compliance with these orders and submit affidavits.

“Meanwhile, bailable warrants are issued against respondent No 2 and 3 (Parsvnath Hessa Developers Pvt Ltd and Parsvnath Developers Pvt Ltd) and their Directors. It is made clear that if they don’t enter appearance, this court would be constrained to issue NBWs (non-bailable warrants) to secure their presence (before it),” the bench ordered.

It also ordered that neither a third party right shall be created nor the possession of the flat will be given to a third party in the meantime. During the hearing, the CJI referred to the real estate firm and said that “not a single project has been completed by them”. “Why are the non-bailable warrants (NBWs) issued by the Haryana RERA not being executed? He should have been arrested. The High Court is also flooded with the cases,” it said.

The bench said the instant petition highlighted the plight of homebuyers who, despite paying full sale consideration, continued to be deprived of their home for the last two decades.

“Petitioners are senior citizens and they invested in Parshunath Exotica in Sector 53 Gurugram. The petitioners were allotted residential units in 2006 followed by the BBA (Builder-buyer agreement) in early 2007. “Rs 1.78 crore was the sale consideration. The flat was to be handed over in 36 months. Possession became due in February 2013,” it noted.

Despite paying the full amount, the petitioners found that the construction was not even near completion. The bench said the petitioners approached Haryana RERA which ordered compensation. These orders were not challenged by the builder and attained finality. However, builders continued to disregard the directions, it said.

“Neither possession was issued nor compensation was paid. Execution proceedings have also become an exercise in futility. Multiple show-cause notices were also served to directors of the builder company,” it said.

When nothing could be recovered, bailable warrants were issued against the builders by the Haryana RERA, it said. “We are perturbed to note that even the bailiff (court staff who went for execution of the RERA orders) was not allowed to enter the builder company. The petitioners are still running from pillar to post. It is in these circumstances that petitioners have approached this court,” it said.

The bench said prima facie, these proceedings raise concerns extending beyond the present case. “The RERA Act provides a statutory mechanism to protect the interest of homebuyers but these cases reveal that the efficacy of such law is ultimately if it is able to secure the implementation of orders passed under the Act. The builders have brazenly disregarded orders passed by Haryana RERA,” it noted.

The bench also noted that the Punjab and Haryana High Court, in April 2025, struck down a state government notification allowing the Haryana RERA to issue recovery certificates. The petitioners were allotted residential units in 2006 and a flat buyer agreement was signed in early 2007.