In a scathing judgment that has sent shockwaves through Maharashtra’s recovery machinery, the Bombay High Court has exposed what it called a “scam within a scam” in the handling of assets attached in the infamous 2013 National Spot Exchange Ltd (NSEL) fraud.
A division bench of Justices A.S. Gadkari and Kamal Khata, in its order dated 8 May 2026 in Criminal Appeal No. 337 of 2026 (Primezone Developers Pvt Ltd vs State of Maharashtra & Ors), set aside the 2020 auction sale of a prime 35-acre residential development land parcel in Assandh, Karnal, Haryana. The property, which was valued at ₹56–74 crore as recently as 2018, was sold for a shockingly low ₹10.09 crore to Rudraveerya Developers Ltd through a process the court described as riddled with “mischief, fraud, and collusion.”
The Backdrop: India’s ₹5,600 Crore NSEL Scam
The NSEL crisis erupted in 2013 when the exchange defaulted on payments to over 13,000 investors, triggering one of India’s largest financial frauds. The Economic Offences Wing (EOW), Mumbai Police, invoked the Maharashtra Protection of Interest of Depositors (MPID) Act, 1999, to attach assets of defaulters, including those linked to Ranjeev Agarwal, who allegedly diverted ₹31 crore of tainted funds into Primezone Developers.
The Haryana land — part of the proposed “Prime City” and “Prime Residential” projects — was attached in 2014. In February 2018, the MPID Special Court made the attachment absolute. Quiker Realty Ltd, appointed as valuer and auctioneer by the Maharashtra government, was tasked with selling the property to recover funds for duped investors.
How the “Scam Within a Scam” Unfolded
The court’s 73-page judgment meticulously dismantles the auction process:
- Wild Valuation Swing: In May 2018, Quiker valued the land at ₹74.74 crore (freehold) and ₹56 crore (distress sale) using the Discounted Cash Flow method for a plotted residential project. Three auction attempts with a ₹60 crore reserve price failed. Suddenly, in June 2020, the same valuer reclassified the land as “agricultural” and valued it at just ₹10.41 crore on an “as is where is” basis — without any fresh site inspection.
- Misleading Publicity: Auction notices were published only in Chandigarh editions of Punjabi (Ajit) and Hindi (Dainik Jagran) newspapers with negligible circulation in Haryana. Later notices appeared solely on Quiker Realty’s website, for which the court noted there was “no data on viewership.”
- Deliberate Misdescription: The property location shown on the auction website was incorrect. The court observed that even the Competent Authority eventually admitted this “material error” significantly affected the valuation.
- Suspicious Bidding: Two of the four bidders shared a common director (Rajan Goyal). Rudraveerya Developers emerged as the highest bidder at ₹10.09 crore. The court called the entire process “pre-planned” to favour a particular buyer.
Justice Kamal Khata, authoring the judgment, pulled no punches: “The Competent Authority and Quiker Realty Ltd. are equally complicit… This is a scam within the scam.” The bench held that the authorities owed a fiduciary duty to the 13,000+ NSEL victims but instead “defeated the very purpose of conducting an auction.”
Landmark Orders by the High Court
The court has directed:
- Immediate return of the entire ₹10.09 crore paid by Rudraveerya Developers within four weeks.
- Appointment of a new Competent Authority within four weeks.
- Fresh valuation by an independent valuer and a completely transparent re-auction with wide publicity in local newspapers and electronic media.
- Disqualification of Quiker Realty Ltd from government valuations and auctions for at least five years.
- Investigation and action against the erring officials of the Competent Authority.
- The attachment on the property continues pending the fresh auction.
The court also allowed the appeal filed by homebuyers (who had purchased plots worth over ₹7 crore) and noted the legitimate claims of Union Bank of India, which held a mortgage on the property.
What It Means for NSEL Victims
For over a decade, NSEL investors have received only meagre recoveries. The court highlighted that the proposed settlement offers victims just 40% of their principal — a devastating loss when adjusted for time value. “Instead of protecting the defrauded investors, the machinery meant to help them became part of the problem,” the judgment observed.
Legal experts say this verdict could have far-reaching implications for other NSEL asset sales handled by the same agencies.
The Maharashtra government has been directed to file a compliance affidavit within six months.
Also Read: Home Buyers Of HDIL Projects Wary, Post PMC Bank Scam
