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Can DLF – Largest Real Estate Developer In India Restore Faith Among Cheated, Irate And Prospective Homebuyers?

DLF also was known as Delhi Land and Finance, India’s largest real Estate Co. is headed by K P Singh – Chairman and Rajiv Singh – Vice Chairman.

DLF was set up by K P Singh’s father–in–law, Chaudhary Raghvendra Singh who had developed 21 colonies in Delhi between 1947 and 1961.

In the beginning of 1980’s, DLF spearheaded transformation in the housing and urban development scenario.

It is stated that DLF’s destiny changed after K P Singh met Rajiv Gandhi on the roadside in sheer serendipitous circumstances.

With the development of Delhi Gov’t ban on private real estate players, DLF began acquiring land at relatively low cost outside the area controlled by Delhi Development Authority.

During the early stage, DLF witnessed phenomenal growth through rental revenues and residential sales business model however it nose-dived into debt and till date continue to swell in debt which rose by Rs. 900 crores during the September quarter of 2017 to Rs. 26,800 Crore for which it held responsible the demand slowdown in the realty market.

DLF posted a 94% drop in profit to Rs. 12.57 crore in the September quarter from a year earlier.

DLF’s consolidated revenue in 2016 was Rs. 9,260 crore and consolidated Net income were Rs. 513 crore.

As per DLF’s CFO Ashok Tyagi, it’s unsold inventory is about Rs. 15,000 crore.

“DLF has been entangled in endless litigation created by its own misdeeds and misfortunes.”

In 2011 , Competition Commission of India ( CCI ) penalized DLF after finding it blameworthy and delinquent for breaching laws pertaining to misusing its dominant position in the market by drafting one-sided , abusive , oppressive , unilateral , unfair and exploitative agreement with the home buyers and CCI termed DLF’s involvement in unfair trade practices in a plaint lodged by buyers in its residential projects; Belaire and Park Place in Gurgaon.

CCI passed cease and desist order against DLF.

CCI verdict on DLF changed the builder-buyer equation by all means directing the builder to modify the terms of the agreement.

Fair trade regulator CCI consistently worked on a model framework for commercial agreements

between DLF and home buyers, which CCI expected to be served as a benchmark.

In 2012, the Delhi High Court rejected DLF’s plea against SEBI and imposed Rs. 2 lakh cost on the errant builder.

In 2012, it was declared by DLF that it’s net profit plunged by whopping 63%.

In 2012, almost eight months after the lease extension expired, the state-promoted Economic Development Corporation Ltd ( EDC ) issued a cancellation and termination notice to DLF for a plot at Patto, Panaji in Goa for failing to commence construction of its shopping mall project.

In 2012, Goldman Sachs removed DLF from its Asia-Pacific buy list.

In 2012, The managing director and six employees of DLF were booked for fraud and cheating for cheating one Jitender Singh Bhasin, a resident of DLF Phase 3 in Gurgaon.

In 2012 , DLF group was asked to pay Vasant Kunj resident Satish Sharma Rs. 7.12 lakh for accepting payment for a flat in an unapproved residential project. District Consumer Disputes Redressal Forum (New Delhi) pronounced “unfair trade practice.”

In 2012 , DLF’s core business performance weakened.

In 2012 , a Canada based research firm – Veritas termed DLF “an organization under duress”. It’s report questioned DLF’s accounting standards.

In 2012 , in Bengaluru, The Bangalore Metropolitan Task Force (BMTF) registered a case against DLF, a former Commissioner of the Bangalore Development Authority (BDA), and a former administrator of the Bruhat Bangalore Mahanagara Palike (BBMP) for permitting widening of a road to legalising the construction allegedly put up beyond the permitted level by DLF.

In 2013, Arvind Kejriwal, now Chief Minister of Delhi accused DLF of getting prime projects in Delhi at low prices.

In 2013, Punjab and Haryana ordered a stay on sale and marketing of DLF’s luxury project; The Crest in phase 5.

Apartment owners of Park Place alleged that DLF had declared in a red herring prospectus that the group housing society ( Park Place ) would be developed on a 30-acre land and would have only 19 stories as per the ( FAR ) Floor Area Ratio of 175% making DLF’s project hit a roadblock.

In 2013, The owners-cum-buyers of DLF New Town Heights in Gurgaon were up in arms against the builder as they were being charged separately for parking.

In 2013, DLF was asked by Consumer Disputes Redressal Forum to pay Rs. 1.5 lakh compensation to allottee for delaying project and for not refunding money.

In 2013, a research arm of the national daily declared DLF in top wealth destroyers list.

The said research organization carried out an analysis of companies with a valuation of over Rs. 5,000 crores and whose market capitalization had eroded substantially from a peak in 2008, when the economy and the markets were buoyant. It showed DLF, which had a market cap of over Rs. 1.8 lakh crore in 2008, had seen three-fourths of it being eroded.

In 2013, Robert Vadra – DLF land deal sparked another controversy as an IAS officer; Ashok Khemka spilled the beans and demanded CAG inquiry.

DLF slipped into the red with Rs 4.2 crore loss in the fourth quarter of 2012 – 2013.

In 2014, DLF was termed as King among corporates entangled in the maximum number of court cases.

In 2014, Park Place RWA, a group housing society filed a case in Punjab and Haryana HC alleging DLF for encroaching and usurping its condominium land and developing a project by the name of Crest in DLF phase 5 in Gurgaon.

DLF estimated to face a financial liability of up to Rs. 100 crore for the various legal cases it was fighting across the country.
In October 2014 SEBI had barred K P Singh & five top executives from entering securities markets for 3 years for non-disclosure of legal cases during the Cos. IPO in 2007.

In 2015, ( CCI ) pronounced to probe DLF’s two more residential projects in Gurgaon.

In 2015, DLF surprised with a report on maintenance expenses for it’s recently delivered project; New Town Heights in sector 90, Gurgaon.

The actual maintenance expenses were found to be 30% to 40% lower than the estimated value. However DLF  insisted that they expected offset ( delta ) of maintenance to be neutralized over the years due to inflation factors.

Residents of Carton Estate, a residential project barely 15 years old developed by DLF in phase 5, Gurgaon are living in a constant fear of the whole building collapsing as there are more than 15 spots in the basement of Carlton Estate IV which have over the time developed prominent cracks and are visible from bare eyes. During rains, water seeps in through such cracks making it all the more vulnerable as Gurgaon falls in seismic zone IV.

Residents also allege that DLF has deliberately and willfully made its erstwhile employee; Alok Kumar Srivastava as the Estate Manager of Carlton Estate RWA in collusion with its senior employee; V K Gupta whom DLF has provided accommodation in the same housing society with nefarious designs to indulge in financial irregularities.

Residents among many senior citizens who are pensioners are struggling with the internal RWA board members who are pro builder and have vested interests and every now and then fleece money from the residents on some of the other

pretext and also involved in several conflicts of interests while running the said RWA of Carlton Estate.

At present, Sachin Jain – President, Sameer Nigam – Secretary, Ibrahim Ahmad – Treasurer, Umesh Sapra – Member ( recently resigned ) etc are among the board members of Carlton Estate RWA.

Recently, the board members have been accused of awarding around 2.5 crores high-value purchase order to Kone ( Elevator Manufacturer ) before expiration of 20 years of the lifespan of the elevators as 5 years of life of the elevators are still left and without floating a tender in at-least two print national dailies despite humble and repeated requests made by the residents.

Residents of Carlton Estate say that they have seen umpteen financial scams over the years ever since they received possession of their flat and are in distress to have been robbed of their peace of mind and would never recommend anyone to buy a property developed by DLF.

A retired Col. from the armed forces ( whose video narrating his ordeal is in public domain ) had invested his entire life savings in a project developed by DLF. He alleged against DLF for ruining his entire life savings as DLF could not give possession of his flat as per stipulated time frame and also levied a penalty of almost equivalent to the cost of his flat.

Homebuyers all across feel let down and are of an opinion that under the existing terms and conditions, they will be left with no other option than fighting with DLF in courts and in any given circumstances would never ever associate with such an unscrupulous builder; DLF.

K P Singh says “Want to remain leader but it’s getting tougher.”

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Can DLF – Largest Real Estate Developer In India Restore Faith Among Cheated, Irate And Prospective Homebuyers?


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