TSRERA :- The Allottee has an obligation to adhere to the payment schedule as agreed in its Agreement of Sale as per Section 19(6) and non procurement of the Home loan amount cannot put the Builder under financial distress.

The Allottee has an obligation to adhere to the payment schedule as agreed in its Agreement of Sale as per Section 19(6) and non procurement of the  Home loan amount cannot put the  Builder under financial distress. 

Sri Umesh Choudhary Vs/ M/s Alpine Infratech 

COMPLAINT NO.519 OF 2023 decided on 12th Day of March, 2024 

BEFORE TELANGANA STATE REAL ESTATE REGULATORY AUTHORITY

Facts :-

1. The Complainant booked a flat in August 2021 in the project of the Respondent Builder.
2. Application Form/Terms and Conditions of Allotment was signed by him.
3. The Agreement of Sale was executed in the month of January 2022.
4. Complainant paid 20% of the cost and the balance 80% amount was to be arranged in form of Home loan.
5. The Project was approved from many nationalized bank but as the Complainant was a Central Government employee so he wanted the Home Loan in the form of House Building Allowance (HBA) from his concerned department. 
6. That vide e-mail dated 15.04.2022, the Complainant sought for several documents ( a list of 19 documents) from the Respondent Builder to avail HBA loan.
7. The complete documents were finally given by the builder on 20.02.2023.
8.  The Builder directed the Complainant to pay the Final due amount by 28.03.2023 else base price will be increased by Rs.200 per sft.
9. The Complainant offered an interim payment of Rs.5,00,000/-  by first week of May 2023 and the full payment by July 2023.
10. In May 2023, the Complainant requested the builder to accept the due amount of Rs.25,00,000/-
11. The Builder refused to accept the amount and stated that they will only accept if the Complainant agreed to make the payment with the revised base rate by Rs. 1000 per sft an increase of  Rs.11,20,000 in total price. 

Complainants Contentions :-

1. The delay in making payment occurred due to non-handing over of documents in time. hence, management is responsible for such delays.
2.  The revised increased rate is not acceptable as the delay in making payment did not occur on default of the Complainant. 
3. Prayed to take needful action against the Respondent Builder as per the applicable rules and regulations and to get the flat at the original agreed rate.

Respondent Builder's Contentions :-

1. The Complainant in spite of availing discount did not pay the agreed amount on time.
2. The Complainant initially agreed orally to take loan from various nationalized banks but later in the month of July 2022, started requesting various documents from the Respondent Company
3. The Complainant made one or the other request for the documents and that too after a lapse of one year and also which were beyond the purview of the Respondent Company and evaded the payments due to the Respondent Company. 
4. The Respondent Company sent several mails requesting the Complainant to visit the office of the Respondent Company to sort the issue. 
5. The Complainant failed to perform his part of contractual obligation and did not make the payment as per schedule, that's why the Company is justified in cancelling the booking 

Observations of the Authority :-

1. In Clause 1.3 of the BBA, the Complainant agreed to make payment as per payment plan set out in Schedule C (Payment Plan).
2. As per the Payment Schedule annexed to the said Agreement of Sale, the Complainant categorically agreed to payment of the schedule therein. which is not disputed by either party 
3. in the annexure to the said Payment Schedule, Point No.4 stipulates that prices are subject to change without prior notice upon non confirmation of sale.  
4.  the Complainant is bound by the same and failure of the Complainant in complying with the payment schedule is derogation of his duty under Section 19(6) of the Act.
5. the delay in procuring the documents cannot be attributed to the Respondent Builder as the said documents may not readily available with him and he may not be in a position to produce documents such as 
1. government pleader's certificate, 
2. estimates, 
3. permission under Conduct Rules for purchase of site and for construction of the house,
4.  Notice under Section 26(1) of the Urban Land (Ceiling & Regulation) Act, 1976, etc
6. Clause 9.3 (ii) of the undated Agreement of Sale executed between the parties clearly stipulates In case of Default by Allottee under the condition listed above continues for a period beyond 2 (two) consecutive months after notice from the Promoter in this regard, the Promoter may cancel the allotment of the [Apartment/Plot] in favor of the Allottee and refund the money paid to him by the allottee by deducting the booking amount and the interest liabilities and this Agreement shall thereupon stand terminated

Order of Authority:-

1. The Complainant is directed to pay the remaining amounts which is pending as on date as per the payment schedule agreed upon by both the parties within 60 (sixty) days, along with interest of 10.65%.
2. In the event the Complainant fails to complete such payment, the Respondent is to initiate measures in accordance with the provisions of the Act and Rules thereunder.

Supreme Court - WB-HIRA is repugnant to the RERA, and is hence unconstitutional

 In the Matter of Forum for People’s Collective Efforts (FPCE) & Anr. V/s The State of West Bengal & Anr.Writ Petition (C) No. 116 of 2019 decided on 04.05.2021 

The Apex court held that 

“83. For the above reasons, we have come to the conclusion that WB-HIRA is repugnant to the RERA, and is hence unconstitutional. We also hold and declare that as a consequence of the declaration by this Court of the invalidity of the provisions of WB-HIRA, there shall be no revival of the provisions of the WB 1993 Act, since it would stand impliedly repealed upon the enactment of the RERA.

Cases pending or ongoing with other tribunals will not be entertained by RERA

 The authority in Gurugram, Haryana in Sh. Sukhbir Singh Grewal Vs. M/s MVL Ltd (Complaint no. 48 of 2018) reiterated that it will not entertain any case which is already pending in another tribunal or court. 

In this particular case, the buyer had filed a case against the builder for delay in giving possession of property beyond the date mentioned in the agreement. The builder submitted that the delay was a result of the interim order passed by SEBI. The builder had moved the Securities Appellate Tribunal (SAT) challenging SEBI’s decision.

 RERA stated that ‘As the matter is already with the SEBI/SAT, accordingly there is no case left for the present before this authority and to continue further proceedings in the matter. Let the issue be decided by the SEBI/SAT. Once the SAT set aside the order of the SEBI then the only allottee may come to us for proceedings under the RERA Act.’ 

Designated Tribunal under Section 43 of RERA ACT will function till such time a regular Tribunal is established

  In a judgment dated 17.09.2018 passed in Writ-C No. 31085 of 2018; Gardenia Aims Developers Pvt. Ltd. v. State of U.P., wherein The Honorable Allahabad High Court  has held that

 Section 43 of the Act prescribes a time of one year for establishment of the Tribunal but the proviso to the said Section says that till such time regular Tribunal is established the State Government will have power to designate any other existing Tribunal to hear the appeals. 

The Court held that in the said case the State Government by an order dated 24.01.2018 had designated the U.P. State Transport Appellate Tribunal as the Tribunal to hear the appeals and the proviso does not prescribe any time limit for functioning of the designated Tribunal, which says that the said designated Tribunal will function till such time a regular Tribunal is established and as the regular Tribunal had not been established till 17.09.2018, the designated Tribunal had jurisdiction. 

Complaints can be instituted against promoters in relation to both projects which have been registered with the authority or which are not registered with the authority

Simmi Sikka V/s M/S EMAAR MGF LAND LTD Complaint number RERA-GRG-7-2018

Haryana Real Estate Regulatory Authority Gurugram 

The judgement contains the following conclusions

• The RERA Act, nowhere mentions anywhere that it is applicable only for the registered projects.

• The RERA Act, provides certain categories of projects which are not required to be registered but these are within the ambit of the Act. These projects mentioned in section 3(2) have been taken out of the registration requirement but not out of the purview of other provisions of the Act.

• The provisions regarding registration and obligation during registration are applicable only for the registered projects.

• The obligations of the promoter’s post expiry of the validity of the registration provided in the Act are applicable to even the real estate projects exempted from the registration.

• The projects which were completed and handed over during the last 5 years are 

covered for the purpose of workmanship and structural defect liability.  A complaint may be filed by the allottee in such matter in case the possession of the real estate was within 5 years prior to the date of the complaint.

• All real estate projects are covered for land title defect liability

• A complaint pertaining to violation of the provisions of RERA Act, Haryana RERA Rules, and regulations thereunder, may be filed by any aggrieved person in respect of any real estate project as per the definition given in section 2(zn) of RERA Act.

Based on the above judgment, it may be concluded that registration of project and filing RERA complaint, both are separate activities. A RERA case can be filed even against the non-registered projects.

In the Absence of Builder Buyer agreement, the Allotment letter if having all the Important details will serve as valid Contract and the complainant can ask for the refund under section 18 also.

 In the Matter of Nikhil Chopra V/s JVPD Properties Pvt. Ltd. Complaint number CC005000000001348 The Maha RERA observed That 

• “The complainant has filed this complaint under Section 18 to claim refund of his amount from the respondents with interest. 

• The respondents issued a letter dated 24.07.2017 expressing their inability to complete the project. 

• The respondents in their reply contended that the complainant is an investor and therefore, the Authority has no jurisdiction to entertain this complaint. 

• The respondent further contended that for the application under Section 18 of RERA, there must be agreement for sale and the complainant does not have it. 

• The Authority observed that lt is a fundamental principle of law of contract that once a proposal is accepted; it becomes a contract, provided  it is coupled with lawful consideration and lawful object and it is not specifically barred by any statute. There can be oral agreement for sale or it can be also in written form. in this case the complainant has relied upon an allotment letter, admittedly issued by the respondents on 11.07.2014.

• The Authority observed that It is the contention of the respondents that there is no concluded contract. Hence, it is necessary to look at the allotment letter. On its perusal it becomes clear that the complainant agreed to purchase the flats and the respondents agreed to sell them for the consideration mentioned in the letter.

•  The respondents agreed to deliver the possession of the flats within 42 months from receipt of final commencement certificate from plinth level. All these terms and conditions have been accepted and signed by both the parties. Therefore, there remains no doubt that it is a concluded contract which has taken place on 11.07.2014.” 

• The Authority therefore ordered 

• “The respondents shall refund the amount mentioned in Para-l0 of this order.

• The respondents shall pay the complainant Rs. 20,000/- towards the cost of the complaint.. 

• The respondents shall pay simple interest at the rate of 10.05% from the dates of receipts of the amount till they are refunded.. 

• The charge of aforesaid amount shall be on the respondents’ property under project bearing C.T.S. No. 634/5 and 64D “S” ward of village Tirandaz, Taluka Kurla, Mumbai, till the complainant’s claim is satisfied.”

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Letter of allotment would tantamount to an agreement for sale

 In the Matter of Manjeet Singh dhaliwal versus Jvpd properties private Limited,the Maharashtra appellate Tribunal held that even a letter of allotment would tantamount to an agreement for sale under Section 2(c) of the ACT if the letter contains the description of the property, payment schedule and costs requisition of permissions, obligation to complete the project and getting Clarity to title. since nothing further was left to be agreed upon, the contract was concluded.

No provisions in RERA and rules there under to forfeit the earnest money.

  In the Matter of Sumit Mukherjee Versus M/s. Rajsanket Realty Limited Complaint No. CC006000000057591 THE MAHARASHTRA REAL ESTATE REGULATORY AUTHORITY, MUMBAI observed that there is no provisions in RERA and rules there under to forfeit the earnest money.

Developer can not charge interest on delay in payment of installments in case of Fit out Possession

In a recent order titled Sukhbir Singh V/s Tdi Infrastructure (Complaint no. 1801 of  2019) , the Haryana Real Estate Regulatory Authority, Panchkula has held that Fit out Possession can not be considered a legally valid offer because in this case, the occupation certificate has not been obtained, in such circumstances, when the developer himself has failed to deliver a valid possession to Alllotee, it can not be allowed to charge interest on delayed payment of installments by the allocates. 

The Complete order can be accessed at this link https://haryanarera.gov.in/assistancecontrol/viewOrderPdf/NTk2MTU=