In a complaint filed by Shankari Sundararaman (“Complainant”) against Sree Vardhana Builders Private Limited (“Company”), 265 of 2020 its directors and landowners of the Project named ‘Vardhana Constellation’ in Coimbatore, for claiming refund of amounts paid towards the purchase of the flat under Real Estate (Regulation and Development) Act, 2016 (“Act”), the Tamil Nadu Real Estate Regulatory Authority, Chennai (“TNRERA”) stated that since directors are actively involved in the affairs of the Company and have received money and corresponded with the Complainant, they would be liable for violations under Section 69 the Act which deals with offences by companies and people responsible for the conduct/business of the company.
However, with respect to landowners of the project site (being the other respondents), TNRERA stated that the landowners had just entered into joint venture agreements and had executed general power of attorney with the Company. The sale deeds for the undivided share of land was only executed by the Company and not the landowners.
Further, it was stated that it was the Company that had launched the project and had entered into various agreements with the Complainant for construction and delivery of the constructed apartment on receiving consideration.
Henceforth, the landowners would not come under the definition of “promoter” and only the Company would fall under the definition of “promoter” to be made liable for contravention under Section 31 read with Section 71 of the Act
