The Enforcement Directorate has arrested Manoj Gaur, Managing Director of Jaypee Infratech Limited, over allegations of laundering money paid by homebuyers for flats. The move stems from claims that funds meant for construction were siphoned off, leaving thousands of homebuyers stranded.

Raids Across Cities

Earlier in 2025, the ED searched fifteen premises tied to Jaypee Infratech and Jayprakash Associates, seizing Rs 1.7 crore in cash along with financial papers, digital data, and property records held by promoters and associated firms. The multi-city raids, spanning Delhi, Mumbai, Noida, and Ghaziabad, were conducted under the Prevention of Money Laundering Act as part of an expanding probe.

Case With National Impact

The controversy began when IDBI Bank filed a petition before the NCLT in Allahabad after the company defaulted on payments exceeding Rs 526 crore. The insolvency proceedings, initiated in August 2017, gained nationwide attention because more than twenty-one thousand homebuyers had booked flats in Jaypee’s projects, particularly in Wish Town, Noida. Many alleged their payments had been diverted, delaying construction. “Funds meant for homes were diverted,” said officials familiar with the investigation.

The Supreme Court intervened to safeguard buyer interests, prompting a key amendment to the Insolvency and Bankruptcy Code that granted homebuyers the status of financial creditors with voting rights in resolution plans.

Resolution Path Forward

Legal disputes deepened over transactions where Jaypee Infratech’s assets were mortgaged to secure debts of its parent entity, Jaiprakash Associates Limited. After multiple bidding rounds, the NCLAT approved Suraksha Group’s resolution plan in 2024, requiring it to complete delayed projects and enhance compensation for affected farmers.