Apparently, the Landowner did not receive the sale consideration and his not filing a case under Section 138 is beside the point and it does not change the facts. Therefore, you have to fight for a refund of the money paid by you to the Developer. Had you paid the Sale Consideration directly to the Land Owner, the problem would not have arisen, or at least at the time of sale, you should have objected merely cheques (which by then not realized) being mentioned in the sale deed. The Developer definitely duped you and the Landowner.
Therefore, you may contact a local competent and reliable Lawyer, explain all the facts and show all the documents, and proceed legally against the Developer duly including the Landowner to hand over the land failing which the refund the money with interest. Of course, the case may drag on several years and you may have to wait for the outcome.