Corporate Oct 19, 2012
Even if India's apparent Julian Assange, Arvind Kejriwal, may have goofed up on the alleged Vadra-DLF nexus in the 350-acre land deal at Gurgaon, the activist-turned politician seems to have found a new supporter base in frustrated flat owners of DLF's Belaire and Park Place projects in Gurgaon.
According to a report in the Business Standard, apartment owners' associations at Gurgaon's Belaire and Park Place projects, which had moved the Competition Commission of India (CCI) against DLF last year, have joined hands with Kejriwal to bring to light quid pro quos between realtors and politicians/bureaucrats. The buyers association will support Kejriwal at a demonstration in Manesar on 1 November, but only to highlight the unfair practices of builders and not any political agenda.
On 12 August last year, the Competition Commission of India (CCI) had imposed a penalty of Rs 630 crore on DLF after finding the realty major guilty of abuse of the dominant market position. The orders were passed following inquiries into complaints filed by the flat buyer associations, alleging delays in the project and increase in the number of floors than planned earlier, selling parking space as additional dwelling units, among other things. As a result of the abnormal delay in projects, hundreds of apartment allottees had had to bear huge financial losses, with their money being locked up with DLF, and had had to wait indefinitely to claim possession of their apartments.
Earlier this year, CCI had again rapped the realty major on charges of abusing its dominant market position to the disadvantage of apartment buyers in its ultra-luxury residential project Magnolia in Gurgaon as DLF had introduced a clause in buyer agreement where only the flat owners loose money if the project does not get requisite sanctions or any adverse order is passed by the government. What's worse is that the Magnolias project showed remarkable escalation in prices just before Vadra's investment. In November 2006, the average sale price of The Magnolias property stood at Rs 5,898 per sq ft. By March 2008, the price rose 70 percent.
Clearly, real estate is one of the biggest cartels run by developers and politicians, and the suffering of these disgruntled flat owners only makes the case for breaking this nexus stronger. While the litigation process for thousand such buyers is still on, perhaps these buyers are hoping to get some sort of justice by approaching the "go-to guy to expose all that's rotten in the state".
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