Another prelaunch scam has come to light in Hyderabad. Jaya Group International, a company operating from KPHB Colony, has duped the innocent buyers in the name of prelaunch sales. After the victims lodged complaints, the police arrested the company MD Kakarla Srinivasa Rao. In fact, REG News had published an exclusive story on December 10 last year on the company’s illegal prelaunch sales and its operations. Exactly 45 days later, the REG News predictions have come true. The initial estimate is that the value of this fraud could be Rs 300 crore.
REG News cautioned that Jaya Group International was selling flats in the pre-launch and one must not get surprised, if the company shuts shop. But neither the RERA nor the police paid much attention. However, the KPHB Colony police have officially announced about the arrest of Group Company MD Kakarla Srinivas recently. Although the police initially estimated that the value of the fraud was up to Rs 20 crore, sources said he collected nearly Rs 300 crore.
Plots in areas like Shankarpally, Chevella, Pragnapur, Sadashivapet, Shadnagar, Shabad, Maheswaram, adn Kandukuru, flats in areas of Kompally, KPHB Colony, Pragati Nagar, Chandanagar, Muthangi, Nizampet, Raidurg, Lingampally, and Sardar Patel Nagar were sold by Jaya International Group under prelaunch schemes. A social media campaign was conducted promising flats for just Rs 3,000 per sft. Believing it to be true, several NRIs also have invested in these projects, including huge investments of Rs 1 crore to Rs 10 crore.
Sources said Srinivas has also collected money from people in the name of shops in commercial complexes and stalls in KPHB Colony metro station. He reportedly collected money promising to pay monthly interest to those who invested in commercial complexes. He is estimated to have collected a massive Rs 300 crore from people and fled away. As a result, the victims filed a complaint at KPHB Colony police station. Kakarla Srinivas, who has been on the run for some time now, was finally arrested by the police on Thursday. His brother and other directors are still at large. Kukatpally ACP revealed in the press conference that there is evidence that the MD of this company has committed fraud. The victims are now seeking justice.
How could anyone believe it?
Some middle-class people became greedy as Jaya Group advertised a villa for Rs 60 lakhs, a house or a double bedroom flat for Rs 40 lakhs, a plot for Rs 35 lakhs in Chandanagar or Pragatinagar, and for Rs 27 lakhs in Muthangi. Many people paid total amount without verifying whether the properties will be delivered or not. Surprisingly, even NRIs got lured to buy properties for cheaper price. Interestingly, Kakarla Srinivas Rao, MD of Jaya Group International in KPHB Colony, who collected crores of rupees from innocent people, does not even know the actual cost for constructing an apartment.
Need for immediate action
The State government remain one step ahead of the scamsters and collect all the details pertaining to companies like Sahithi group which are violating the RERA norms.
- The RERA should involve the buyers and ask them to provide information about the companies from which they bought the flats under the pre-launch sales. Thus, a scare can be created among the builders who sold flats under the pre-launch offers and pressurise them to complete the projects.
- Notices should be issued to such pre-launch companies and the progress of these projects should be monitored constantly. Precautionary measures should be taken immediately, even though monitoring the work progress of these projects is not withing the responsibilities of RERA.
- RERA authority should prepare a data base of the developers who sold properties under pre-launch sales.
- A wide-range publicity campaign should be run by cautionining the builders against selling flats under pre-launch schemes.
- People will not invest in such scam projects in the future only when the State government initiates proactive measures.
- Considering the middle-class population, the State government should start efforts to build affordable houses. Otherwise, there is a risk that unscrupulous builders offer flats at low rates and lure innocent buyers.
- The government should act responsibly and set up a full-fledged RERA as well as an appellate tribunal. Even though the RERA Act came into force in 2016 across the country, the authority was constituted in Telangana in 2018. However, the authority has been criticised for limiting itself to registering the real estate projects rather than addressing the problems faced by the sector.
