Assignment or transfer of development rights does not automatically extinguish the allottee's statutory rights.

 

Mayuresh Vijay Kulkarni v. Shree Raghvanshi Developer & Ors.

Forum: MahaRERA

Facts:
The complainant purchased a residential flat in a redevelopment project and made substantial payments, although no registered Agreement for Sale was executed. The project was significantly delayed and subsequently lapsed. Development rights were later assigned to a new developer through a tripartite arrangement.

Issue:
Whether the successor developer becomes responsible for the liabilities of the earlier promoter, particularly delayed-possession interest.

Held:
MahaRERA held that the new developer had stepped into the shoes of the erstwhile promoter and was liable to pay interest under Section 18 until actual handover with the OC. The Society was not held liable.

Ratio:
Assignment or transfer of development rights does not automatically extinguish the allottee's statutory rights. Where the successor developer assumes the development rights and obligations, it can also assume the corresponding liabilities toward existing allottees.

Practical Impact:
Successor developers undertaking stalled redevelopment projects should conduct a comprehensive liability assessment before accepting development rights. Existing allottees may continue to assert Section 18 claims notwithstanding changes in the development entity.

Relevant RERA Sections:
Section 11 — promoter obligations; Section 18 — delayed possession; Section 15 — obligations relating to transfer/assignment of majority rights and liabilities, where applicable.

Where apartments are received as part of a development arrangement in consideration for transfer of development rights, the landowner may fall within the promoter framework rather than the allottee framework.

 

 Rubina Abdul Rauf Patel & Ors. v. Touchstone Builders and Developers

Forum: MahaRERA

Facts:
The complainants were landowners who transferred development rights to the respondent under an MOU dated 22 April 2019. In consideration, they were to receive four flats and two stilt parking spaces in the “DEEP PLANET” project. They claimed possession and compensation for delayed possession, contending that possession was due by 11 November 2023.

Issue:
Whether landowners who receive flats in consideration for transfer of development rights can claim the status of “allottees” under RERA and maintain a complaint for delayed possession.

Held:
MahaRERA held that the complainants were not “allottees”. Complainant No. 1 was shown as a landowner-promoter having an area share in the project. The transaction involved transfer of development rights rather than payment of monetary consideration for purchase of the apartments.

Ratio:
The definition of “allottee” cannot be applied mechanically to a landowner-promoter. Where apartments are received as part of a development arrangement in consideration for transfer of development rights, the landowner may fall within the promoter framework rather than the allottee framework.

Practical Impact:
Development agreements must be carefully examined before invoking Section 18 as an allottee. A landowner's contractual entitlement to flats does not automatically confer the statutory status of an allottee.

Relevant RERA Sections:
Section 2(d) — Allottee; Section 2(zk) — Promoter; Section 18 — Return/refund and interest.