Locals and police officers said the dealers had taken over some 12 acres near the Tughlaqabad shooting range in Surajkund and sold them to labourers at throwaway prices — about Rs 30,000 for 50 square yards.

The buyers had then spent money to build hovels on them, taken in by the dealers' assurance that everything was legal, even though there was no paperwork.

Anjali and Neemai Boiddah, a couple who lost their home on Thursday, said they had gone for their sweeping jobs in the morning and immediately rushed back after getting a phone call. They found their house demolished, their household goods damaged.

“I got the shock of my life,” said a distraught Anjali. “Now everything we ever saved for, bought with our meagre earnings, lies under the rubble there.”

Locals said the property dealers spread the word that a wooded area belonging to the Faridabad Nagar Nigam was available for sale. People would turn up to take a look and a deal would be struck.

A police officer said, “The dealers claimed to have got permission from the owner to sell individual plots. By fooling the uneducated labour-class people, they marked boundaries by placing bricks around plots of approximately 50 square yards each. And then it was sold. No paperwork, no bonds, no agreements.”

He said they had been doing this for at least six months.

People said there are three property dealers involved in the scam and that police and Nigam officials were involved too. About 600 people lived on the land, without amenities like water and electricity. Apparently, they had been promised bore wells and electricity supply in about a month.

“I had taken my savings and borrowed money to buy a plot here. Others living here encouraged me to buy the plot saying that it was legal. Now I am doomed,” Ashutosh said.

His wife Monica sat with tears in her eyes, gathering what remained of their belongings on a cot outside the debris that was once their house.