In a significant development, the Enforcement Directorate (ED) on Thursday arrested Manoj Gaur, Managing Director of Jaypee Infratech Limited (JIL) and former Executive Chairman and CEO of Jaiprakash Associates Limited (JAL), in connection with a money laundering case linked to alleged cheating of thousands of homebuyers.
The arrest marks a crucial escalation in the agency’s long-running investigation into the Jaypee Group, which has been under scrutiny for several years over financial irregularities, project delays, and diversion of funds meant for residential projects in the National Capital Region (NCR).
Background of the Case
The case against Manoj Gaur stems from multiple FIRs filed by the Economic Offences Wings (EOW) of both Delhi Police and Uttar Pradesh Police. The complaints were lodged by homebuyers of the Jaypee Wishtown and Jaypee Greens projects, who alleged that they were cheated and misled by the company’s promoters.
According to the ED, funds collected from thousands of homebuyers for the construction of residential projectswere diverted for other purposes, leaving projects stalled and buyers in financial distress. The probe agency has alleged that the diversion was carried out through a complex web of transactions across multiple group entities.
ED’s Findings: Massive Diversion of ₹14,599 Crore
In its official statement, the ED stated that Jaypee Infratech Limited and Jaiprakash Associates Limited collected around ₹14,599 crore from homebuyers — an amount later confirmed by the National Company Law Tribunal (NCLT)during insolvency proceedings.
However, instead of utilizing these funds for construction, a substantial portion was allegedly siphoned off to other Jaypee Group companies and trusts, including:
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Jaypee Sewa Sansthan (JSS)
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Jaypee Healthcare Limited (JHL)
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Jaypee Sports International Limited (JSIL)
The agency further alleged that Manoj Gaur played a central role in this financial misappropriation. As the Managing Trustee of Jaypee Sewa Sansthan, Gaur allegedly oversaw transactions through which part of the diverted funds were funneled.
“The investigation has established the central role of Manoj Gaur in the planning and execution of the fund diversion through a complex web of transactions within the Jaypee Group and its associated entities,”
— ED official statement
Earlier ED Searches and Evidence Trail
This arrest follows a series of search operations conducted by the Enforcement Directorate earlier this year. On May 23, 2025, the agency carried out raids at 15 locations across Delhi, Noida, Ghaziabad, and Mumbai, including the corporate offices of JAL and JIL as well as residential premises linked to senior company executives.
During these searches, the ED reportedly seized documents, digital evidence, and transaction records that allegedly revealed systematic fund transfers from project accounts to unrelated business entities under the Jaypee Group umbrella.
The agency also traced money trails linking project funds to charitable trusts and subsidiaries, further strengthening its case under the Prevention of Money Laundering Act (PMLA).
How Homebuyers Were Affected
The Jaypee Group, once one of India’s most prominent real estate and infrastructure developers, launched several high-profile housing projects in the Noida and Greater Noida regions, including Jaypee Wishtown and Jaypee Greens.
Thousands of homebuyers invested their life savings, expecting timely delivery of apartments. However, as the projects stalled and insolvency proceedings began, many found themselves in limbo — with neither possession of homes nor refunds in sight.
The NCLT later admitted claims worth thousands of crores against Jaypee Infratech, with homebuyers classified as financial creditors under the Insolvency and Bankruptcy Code (IBC). Despite multiple resolution attempts, including bids by NBCC (India) Limited and Suraksha Group, the issue remains only partially resolved.
Charges and Legal Framework
Manoj Gaur’s arrest is under provisions of the Prevention of Money Laundering Act (PMLA), 2002, which allows the ED to act on the basis of predicate offences registered by other agencies like the police or the CBI.
The allegations against him include:
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Criminal conspiracy and cheating under Sections 120B and 420 of the Indian Penal Code (IPC)
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Criminal breach of trust (Section 406 IPC)
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Money laundering (Section 3 of PMLA)
The ED has accused Gaur and other senior executives of using homebuyers’ funds for non-construction purposes, routing money to associated firms, and concealing the true source and purpose of transactions to evade detection.
The Larger Implications
The arrest of Manoj Gaur underscores the increasing accountability of real estate developers under India’s tightening financial laws. The case also highlights the role of regulatory and enforcement agencies in protecting consumer interests amid widespread irregularities in the housing sector.
Thousands of homebuyers continue to seek justice and completion of their long-delayed homes. With Gaur’s arrest, the ED’s probe is expected to intensify further, possibly leading to more arrests and asset attachments in the coming weeks.
Legal experts suggest that the development could also impact ongoing insolvency proceedings involving Jaypee Infratech and its parent company, Jaiprakash Associates, especially if financial mismanagement is proven at a larger scale.