Keeping Him in Jail Will Not Help the Homebuyers: Supreme Court Grants Bail to Real Estate Developer Accused in 81 FIRs

“We Want to Give One Chance to the Petitioner to Settle the Claims of Home Buyers”, Supreme Court of India delivered a crucial ruling in the case of Alok Kumar vs. The State of Bihar, granting temporary bail to Alok Kumar — a real estate developer embroiled in 81 criminal cases for allegedly duping homebuyers of over ₹13.94 crore. The Court observed that continued incarceration of the accused would do little to serve the interests of the aggrieved buyers.

“We want to give one chance to the petitioner to work out the modalities for settling the various claims of the homebuyers,” the Bench comprising Justices J.B. Pardiwala and R. Mahadevan stated, in a move driven by the practical realities of mass real estate fraud.

Alok Kumar, a Director of the Patna-based real estate company Agrani Homes, was accused of defrauding dozens of homebuyers by promising them flats which were never delivered. The first complaint was lodged on January 11, 2018, at Shastri Nagar Police Station in Patna under Section 420 of the IPC and Section 138 of the Negotiable Instruments Act. The charges escalated, eventually resulting in 81 separate FIRs filed against him.

The petitioner had been in judicial custody since October 14, 2022, with bail granted only in 10 out of the 81 cases. Despite a prior order of the Patna High Court on February 7, 2025, refusing to club the FIRs, the Supreme Court took a different view — one shaped by the larger goal of restitution.

The two key issues before the Court were whether the numerous FIRs with similar allegations could be consolidated, and whether the accused could be released on bail to facilitate repayment and settlement with homebuyers.

In its order dated March 20, 2025, the Bench observed: “Prima facie, it appears from the materials on record that there are in all 78 FIRs registered against the petitioner... These FIRs have been registered by homebuyers. It appears that the petitioner is a builder/developer who floated a scheme and is alleged to have collected about ₹13 crore from different individuals interested in the purchase of flats.”

The petitioner submitted that out of ₹13.94 crore, ₹3.17 crore had already been paid back, and that he was ready to deposit ₹3 crore more, in addition to offering a property worth ₹4 crore as security. The Court, however, declined the offer of immovable property and directed a cash deposit instead.

“We are of the view that instead of accepting any immovable property as security, the petitioner should deposit an amount of ₹4 crore with the Registry of this Court,” the Bench noted.

The Supreme Court allowed the prayer for clubbing of the FIRs, stating: “The very first FIR dated 11.01.2018... shall be treated as the main FIR. All other First Information Reports shall be treated as statements under Section 161 of the Criminal Procedure Code, 1973.”

The Court relied on the precedent set in Satinder Singh Bhasin v. State of U.P., reported in (2023) 14 SCC 805, which permitted consolidation where multiple FIRs arise from the same transaction or scheme.

Recognizing the need to act in the interest of the real victims — the homebuyers — the Court made a striking observation:

“Keeping the petitioner in jail for an indefinite period of time is not going to serve any good purpose, so far as the interest of the home buyers is concerned.”

Undertakings and Asset Disclosure

To secure the interests of the complainants, the Court took note of multiple affidavits and undertakings:

“I hereby undertake to file proof of settlement or settle the balance amount of ₹9.94 crore with respect to all 81 FIRs against the Petitioner within 6 months from the date of release,” Alok Kumar declared in his affidavit dated August 6, 2025.

A parallel affidavit was filed by his son, Shashwat, who further pledged: “In case the Petitioner fails... I would also be personally bound by the said undertaking.”

The Court further directed the petitioner to submit a list of all properties held in his name and that of his companies. In compliance, Alok Kumar disclosed that there was one residential flat in his name, seven properties in the company’s name, and 62 projects under development agreements.

“The Petitioner shall take the permission of this Court before selling any property registered in his name or in the name of his company,” the Court ordered, adding an extra layer of oversight.

Bail Granted with Conditions: “This Is Not a Full and Final Settlement”

Granting temporary bail for six months, the Court directed the petitioner to deposit the remaining ₹9.94 crore with the Registry. However, it was cautious to clarify:

“We make it explicitly clear that the deposit of ₹9.94 crore should not be construed by the petitioner as full and final settlement of all the dues and claims. This amount ultimately has to be distributed amongst all the home buyers.”

The Court laid down several conditions for bail, including the requirement to surrender the passport, mark fortnightly attendance at the local police station, and abstain from transferring any property rights.

Should he fail to fulfill the financial obligations within six months, the bail will be cancelled.

“We hope that the petitioner is able to make the most of this indulgence granted by us, keeping in mind only the interest of the home buyers,” the Court remarked in conclusion.

Enforcement Directorate Not Barred from Action

Importantly, the Court clarified: “So far as the ED is concerned, it shall proceed in its own way, in accordance with law,” keeping the door open for parallel investigation and prosecution under the Prevention of Money Laundering Act (PMLA) and other financial regulations.

The Supreme Court’s decision in Alok Kumar vs. State of Bihar marks a pragmatic turn in the handling of real estate fraud cases — balancing the punitive function of law with the urgent need for restitution.

Rather than allowing the accused to languish in custody while buyers remain uncompensated, the Court has charted a route that incentivizes recovery, demands accountability, and places victims’ interests at the center of criminal process.

Date of Decision: August 12, 2025