ISLAMABAD  -   The Joint Investigation Teams (JITs) constituted by the Supreme Court to conduct forensic audit of housing societies across the country have recommended the initiation of legal action against the delinquent housing societies and schemes across the country.

The JITs have also recommended the registration of criminal cases and enquiries against the public servants functioning in development authorities and other regulatory bodies, who are engaged in delaying the decisions with mala fide intention regarding the issuance of NOCs.

The registration of criminal cases and enquiries has also been recommended against the officials with the connivance of whom the illegal schemes have been set up and sold by the developers.

Director General Federal Investigation Agency (FIA) on behalf of JITs submitted progress report before the Supreme Court regarding forensic audit further recommending necessary directions to all the Development Authorities and Regulators for processing pending applications of registration of private housing schemes. 

“Weak Legal regime against the menace (as the offense of Cheating Public at Large has only been introduced in National Accountability Ordinance, 1999 while other law enforcement agencies like FIA and ACE could not take actions against private cheatings) are the main reasons of the popularity of these illegal schemes,” it further stated.

It is further recommended that the sole proprietor firms and the firms registered under the Partnership Act should be banned to launch any housing project and only companies registered under the Companies Act 2017 should only be allowed.

A centralised Agency at provincial or federal level has also been recommended to look after regulatory affairs of private and cooperative housing societies, which should also have investigative powers.

Directions for all the development authorities for the preparation of the master-plan of all the big cities have also been recommended.

According to the report, there are 1716 illegal housing societies while 4356 housing schemes are in the process of registration.

Punjab is on top with the total 1371 illegal housing societies while 329 illegal housing schemes are in Sindh. Nine illegal housing societies are in KP, 1 in Balochistan and 6 illegal housing schemes are in ICT.

The report states that it is dire need of the day to initiate a strict immediate legal action and crackdown against the illegal housing societies.

It further added that tedious process of registration requiring multiple steps should also be reviewed and replaced with one window process with a strict time bar on its completion.

“There is a complete disconnect between the authorities granting permission for the housing projects and between the regulators monitoring the affairs of the private companies/firms, who are launching these projects,” the report added.

There are 43 cooperative housing societies are in Islamabad Capital Territory (ICT), 163 in Punjab, 399 in Sindh, 36 in Khyber Pakhtunkhwa (KP) and 26 in Balochistan making a total of 667 registered cooperative housing societies in Pakistan.  

Out of 667 housing societies, only 108 have been found law abiding whereas legal action has been recommended against rest of the Societies by NAB, FIA, ACE and the district administration/regulators according to the nature of the illegalities/irregularities determined during audit.

It is observed that most of the societies have purchased disputed/controversial land, without adopting the proper procedure and PPRA rules.

“Most of the land purchased by the Societies is scattered over a large area making it impossible to develop a Housing Project and the same have so far not been consolidated despite the lapse of 10-15 years since their registration.”

“Large sums have been misappropriated through over-invoicing and the hard-earned money of the members has been going into the pockets of the office bearers of these Societies in collusion with the land-dealers/property mafia and revenue department,” the forensic report added.

Huge amounts have been paid to “Qabza Groups” Squalors on account of compensation possession charges without verifying their actual share in the land holdings as per revenue record.

“Payments on the pretext of possession charges are the basic loophole where the Managing Committees of the different Societies are able to embezzle/mis-appropriate large sums,” the report stated.

In almost all the cooperative housing societies, the plot sizes have been considerably reduced without lawful authority and the members have been forced to pay extra amounts on account of development charges etc.

As far as the private housing schemes are concerned, the same include housing schemes launched by Sole proprietors, housing schemes launched by partnership firms registered under Partnership Act 1932 and the housing schemes launched by the companies registered under the Companies Act 2017.

28 private housing schemes are registered in ICT, 1418 in Punjab, 1362 in Sindh, 42 in KP and 203 in Balochistan making a total number of registered private housing societies 3053 across the country.

Out of these 3053 housing schemes, only 663 have been found law abiding whereas legal action has been recommended against rest of the schemes by NAB, FIA, ACE and the district administration/regulators according to the nature of the illegality/irregularity commuted by the management of these schemes.

A huge number of societies have extended their area, illegally, and are marketing and selling the said area as part of the society, defrauding the general public.

“In some instances, applications have been submitted for regularisation of such illegal extension, while in many others not even such applications have been put forward. In many cases such extension is several times larger than the size of the actual Society,” it added.

It is has been observed that applicants not allotted plots are induced to keep their investment with the Society, with promise of being accommodated in future projects adding that encroachment on park, mosque, graveyard and public sites is very common while the layout plan is modified by developers without the approval from the regulator.

In case of sole proprietorship firm, there is neither any regulatory regime nor any registered mechanism of ownership exists. There is no legal binding on the proprietors for the annual audit of the scheme.

“The master plan previously conceived is repeatedly revised, on the whims and wishes of the decision makers, without realizing the actual situation on the ground. The areas marked as flood-prone and green in the master plan have been, practically, converted into built-up areas at the site,” it added.