When and How to File an FIR Against a Builder Who Cheats You

You can file an FIR (a First Information Report, the written record that starts a police investigation) against a developer only when the facts show a genuine crime, not merely a broken promise. In most Mumbai redevelopment disputes the right forum is MahaRERA or a consumer or civil court, because a delay, a funding gap or an argument over area is a civil wrong. It crosses into criminal territory when there is dishonesty from the start, or when money and property lawfully handed to the builder are misused. In law that means cheating under Section 318 of the Bharatiya Nyaya Sanhita (BNS), 2023, or criminal breach of trust under Section 316, the provisions that replaced the old Sections 420 and 406 of the Indian Penal Code. This guide explains, in plain language, how to tell the two apart, when to go to the police, how to file the complaint step by step, what evidence to preserve, and how to keep your RERA and consumer cases running at the same time.

First, is it a crime or a civil dispute?

This is the single most important question, and getting it right protects your society from wasting time at the wrong door. A civil dispute is about enforcing your agreement: getting the flat built, the money refunded, or interest paid for delay. A crime is about dishonesty: the builder deceived you deliberately, or diverted what was entrusted to them. The same delay can be purely civil in one society and criminal in another, and the difference lies entirely in intention and conduct, not in how upset the members feel.

A helpful test is to ask when the dishonesty began. If a developer never intended to deliver and used false figures only to win your consent, that points to cheating. If the developer took your money or building lawfully and then misused it, that points to criminal breach of trust. If it is simply a project that ran into honest trouble, it is a civil matter for MahaRERA. Our guide on what to do when a builder delays your project walks through the civil options in detail.

The two offences that matter most

Two sections of the Bharatiya Nyaya Sanhita, 2023, cover almost every dishonest redevelopment situation. It is worth understanding the difference, because they cannot both be alleged on the same set of facts.

• Cheating — Section 318 BNS (its sub-section 318(4) is the direct successor to the old Section 420 IPC). This applies when the builder was dishonest from the outset — deceiving your society into parting with consent, possession or money by promises they never meant to keep. The key ingredient is dishonest intention present at the very start.
• Criminal breach of trust — Section 316 BNS (formerly Section 406 IPC). This applies when property or money was handed over lawfully and honestly, and the builder then misused or diverted it — for example, using your corpus, rent or sale proceeds for a different project. The basic offence carries imprisonment of up to five years.

Because cheating assumes dishonesty from the beginning and breach of trust assumes an honest start followed by misuse, a court will not accept both labels for the identical conduct. A good complaint therefore describes the facts plainly and lets the police and the court apply the correct section. Forgery and criminal conspiracy are separate offences that often accompany these when signatures or consent letters are fabricated. Both cheating and criminal breach of trust are cognizable offences, meaning the police may register an FIR and investigate without a court's prior permission. For more, see why the courts treat builder cheating as a criminal matter.

Warning signs that conduct may be criminal, not just civil

Recognising dishonesty early is the best protection of all. The table below links common warning signs to what they may indicate and the sensible, on-paper response. None of these signs on its own proves a crime, but several together are a reason to take advice and preserve records.

When should your society actually go to the police?

Go to the police when the conduct clears a real threshold of dishonesty and you can show it on paper. Reasonable triggers include: money or possession taken and then the project abandoned; corpus or rent openly diverted to another site; the same flat sold or mortgaged twice; forged signatures or fabricated consent; or promises that the record shows the builder never intended to keep. If instead the builder is genuinely trying but is late or short of funds, that is a civil and RERA matter, and rushing to the police rarely helps. When you are unsure which door to use, our note on which forum hears a redevelopment dispute is a useful starting point.

How to file a police complaint or FIR, step by step

1. Build the paper trail first. Police act faster on a clear, documented complaint than on a spoken grievance. Assemble your agreements, payment records and correspondence before you go.
2. Authorise the complainant. Where the fraud is against the society, pass a resolution in a committee or general body meeting authorising named office-bearers to complain on the society's behalf. An individual member who was personally cheated can also complain in their own name.
3. Write a dated, chronological complaint. State plainly what was promised, what was paid or handed over, what the builder did, and why it was dishonest. Attach copies (never originals) of your evidence.
4. Go to the police station with jurisdiction — usually the one covering the society or project. Ask for the complaint to be registered as an FIR because it discloses the cognizable offences of cheating and criminal breach of trust.
5. Collect the FIR copy. You are entitled to a free copy of a registered FIR. Note the FIR number and the investigating officer's name.
6. If the police refuse to register it, submit your written complaint to the senior officer (the Deputy Commissioner or Superintendent of Police), and, if still refused, apply to the local Magistrate, who can direct the police to register and investigate. This escalation route is provided by the criminal procedure law that has replaced the old Code of Criminal Procedure.

Evidence every committee should preserve

The strength of a criminal case rests almost entirely on documents. Keep the following safe, ideally with certified or notarised copies stored away from the committee's day-to-day files:

• The registered Development Agreement (DA) and the Permanent Alternate Accommodation Agreement (PAAA) — both must be registered under Section 17 of the Registration Act, 1908.
• All money receipts and bank statements showing corpus, rent and any other payments, and any cheque-return memos.
• Minutes and resolutions of meetings, and the video recording and Registrar's officer's record of the developer-selection meeting where one exists.
• Every letter, notice, email and message exchanged with the builder, in date order.
• Sanctioned plans, the RERA registration details, the bank guarantee, and any brochure or written promise about area, corpus, rent or timeline.

Run RERA and consumer remedies in parallel

A criminal FIR punishes dishonesty, but it will not, by itself, get your building finished or your money returned. Those outcomes come from your civil remedies, and you are usually allowed to pursue both tracks together. While the police investigate, keep pressing on the money and the flat.

Because the aims differ, many societies keep the money claim alive at MahaRERA under Section 31 while the FIR pursues the dishonesty, and add a consumer claim for deficient service where it fits. The tracks support each other rather than compete.

How to protect your society before it ever reaches an FIR

The best FIR is the one you never have to file. Most redevelopment fraud is prevented at the agreement stage, with a few disciplined habits:

• Put every promise in the registered agreement. Area, corpus, rent and timeline that live only in a brochure are hard to enforce. Registration under Section 17 of the Registration Act, 1908, makes the DA and PAAA legally solid.
• Ring-fence the money. Under RERA, 70% of buyers' funds must sit in a separate project account used only for that project (Section 4(2)(l)(D)). Confirm the account exists and pay only into it.
• Keep the selection clean. No committee member, office-bearer or their relative may be the developer under the 4 July 2019 directive; guard against a hidden committee-developer nexus.
• Compare offers on paper, not on charm. Use our offer comparison tool to weigh developers on like-for-like terms before you commit.
• Get the tender and agreement reviewed. An independent tender and agreement review catches the missing clauses and one-sided terms that later turn into disputes.
• Register your society's project early so you have expert eyes on the process from day one. You can register your society to begin.