Updated at 6.20pm on 11 July 2025 to include response from Ozone Group official
Thousands of distressed home-buyers across India have accused Bengaluru-based Ozone group of orchestrating a multi-crore real estate fraud stretching over a decade and affecting projects in Chennai, Bengaluru and Mumbai. In what buyers describe as one of the most brazen property scams in recent memory, allegations point to a deep-rooted nexus between the builder, banks and even government officials, leaving hundreds of families financially and emotionally shattered.
At the heart of the accusations is a long-standing pattern: promising timely possession, collecting large sums from home-buyers and banks, and then abandoning projects mid-way.
In Chennai, one of the earliest projects—The Metrozone in Anna Nagar—launched in 2008, remains incomplete. In 2016, two new towers were introduced under a subvention scheme, adding to the chaos, as banks reportedly disbursed loans in buyers’ names directly to the developer without proper sale agreements. Buyers, who were assured that the builder would bear the equated monthly instalments (EMIs) until possession, are now being hounded by banks for repayment. Several complainants allege that their credit scores have been ruined and they have been pushed into legal quagmires they never anticipated.
Buyers claim that tripartite agreements, which were supposed to safeguard their interests, were rendered meaningless as banks ignored due diligence and funds were released without registered construction or sale deeds. This has sparked fears of institutional collusion. Some affected families say they are not just victims of a rogue developer but of a compromised system.
The situation in Bengaluru is equally grim. At Ozone Urbana in North Bengaluru, multiple buyers have claimed that the same apartment was sold to different individuals. Despite favourable court orders, the developer has reportedly failed to comply, adding to the buyers’ woes. In a shocking turn, many complainants believe that government authorities are reluctant to act, possibly to protect vested interests.
A recent first information report (FIR) filed by the Resident Welfare Association of Ozone Urbana pegs the alleged fraud at Rs3,300 crore. Of this, Rs1,500 crore was reportedly raised as mortgage loans in buyers’ names — without their knowledge — while Rs1,800 crore was directly collected from them. The FIR states that only 49% of the construction has been completed, even though the project began in 2012 with an original delivery timeline of 2017.
The central crime branch (CCB) has also filed a case against Ozone Urbana Infra Developers Pvt Ltd and unnamed officials of private banks for criminal conspiracy, cheating, and breach of trust. The company is also under the scanner of the central bureau of investigation (CBI), although buyers claim that enforcement remains slow and ineffective.
The Karnataka real estate regulatory authority (KRERA) has repeatedly pulled up the company for non-compliance with refund orders. In February 2025, KRERA went a step further by invoking the legal doctrine of lifting the corporate veil to hold seven directors personally accountable.
The authority noted that, despite over Rs170 crore in outstanding dues to buyers, the company had no assets in its name to recover funds, compelling revenue officials to target directors’ personal properties. However, even these auction notices were quashed by the high court (HC), prompting KRERA to bring the directors directly into legal proceedings.
Frustrated by inaction, many buyers — especially senior citizens — have begun withdrawing their cases from KRERA. According to a report from
Hindustan Times (HT), in March 2025, seven such cases were formally withdrawn, with buyers citing the authority’s failure to enforce its own orders. Many have now turned to the Karnataka HC, the national company law tribunal (NCLT), or even the National Human Rights Commission (NHRC) in a desperate search for justice.
A particularly heart-wrenching example, cited by the newspaper, is that of 78-year-old Dipak Chaudhary, who invested his retirement funds into an apartment at Ozone Urbana. Diagnosed with Parkinson’s, Mr Chaudhary is now bedridden while his wife continues the legal fight. “We don’t want to burden our children with this. We’ve already booked a new flat with another builder, but we are still waiting for the money we rightfully deserve,” she told HT.
Buyers say the government must act swiftly to prevent such fraud from becoming a blueprint for other developers. They have submitted complaints and petitions to the prime minister’s office (PMO), the chief minister’s office (CMO), and local officials.
In one Chennai case, land meant for a tower was attached for recovery, but authorities have reportedly stalled its auction for years.
Legal experts and advocates have also flagged significant flaws in the current real estate grievance redressal framework. They argue that RERA bodies across states, including KRERA, lack enforcement teeth. While orders are passed, revenue officials are often too overburdened to follow up, and developers exploit legal loopholes to delay or avoid payments.
To address this, lawyers recommend appointing judicial members within RERA bodies and creating special enforcement officers to monitor and execute orders. They also call for periodic physical inspections and freezing of developer escrow accounts if there are pending legal obligations.
Meanwhile, more than 1,800 buyers in Bengaluru alone continue to wait—some for over a decade—for either their flats or their money.
The Ozone group case, though striking on its own, is being seen as a warning sign of systemic rot. With refund liabilities across Karnataka builders rising to over Rs486 crore and recovery rates abysmally low, experts say a regulatory overhaul is urgently needed. Failure to act decisively now could embolden other rogue developers, leaving countless more citizens in similar distress.
UPDATE:
Responding to Moneylife, in an email statement, a director of Ozone group says the company remains committed to resolving all issues transparently and in accordance with the law, and is taking tangible steps to protect the interests of its customers, investors, and institutional partners.
Here are the updates shared by the director of the Ozone group...
1. Delay in Possession - "The Metrozone" Project, Anna Nagar, Chennai
Launched in 2008, the Metrozone project has witnessed phased progress over the years. As of now, 1,425 units have been handed over, with 132 units under construction, which are scheduled for completion and delivery within 6 months. In the Ozone Urbana project in Bengaluru, 1,818 units have been delivered, while 695 units remain, with a 12-month timeline for handover. We have jointly submitted a Timeline Completion Memo before TNRERA to formally commit to these deadlines.
2. Alleged Defaults on Subvention Scheme EMIs (Metrozone)
All disbursements under the subvention scheme were made based on tripartite agreements signed between the customer, the bank, and the developer. Disbursements occurred only after the customer's consent and as per the agreed payment schedule.
Ozone Group also fulfilled its obligation to pay pre-EMIs as per the terms of the agreement. Matters relating to these payments are currently under consideration by the Hon'ble Karnataka High Court, in continuation of related RERA and other forum orders.
3. Registration of Agreements
Sale and construction agreements were executed prior to the implementation of RERA guidelines. As such, they were not subject to mandatory registration under the earlier framework.
4. Allegations of Multiple Sales of the Same Unit (Ozone Urbana, Bengaluru)
We categorically deny this allegation. The claim of multiple sales for the same unit is factually incorrect.
5. Non-Compliance with RERA and NCLT Orders
All relevant cases are currently pending before the Karnataka High Court, where we have been directed to submit an affidavit along with a resolution plan. We are actively complying with court directions.
6. CBI Investigation & Allegations of Bank-Builder Collusion
Ozone Group has submitted all required responses to the relevant authorities. As per our understanding, the matter has since been closed.
7. Steps Taken to Deliver Delayed Units in Chennai, Bengaluru and Mumbai
We have submitted a comprehensive resolution plan to the respective RERA authorities in Chennai, Bengaluru, and Mumbai to ensure the completion and delivery of all pending units within the committed timelines.
8. Procedural Violations and Demand for Third-Party Audit
There have been no procedural violations. Disbursements by financial institutions were carried out in accordance with tripartite agreements and customer confirmations at each construction stage.
Audited financial statements have already been submitted to RERA authorities, and we remain open to scrutiny as per regulatory norms.
9. Response to RERA and Enforcement Directives
We are fully cooperating with all regulatory authorities. The Karnataka High Court is currently overseeing these matters, and we are in the process of filing our resolution and compliance affidavit as directed.
