MahaRERA - To ensure that the said project is not jeopardized due to the outflow of finances it is directed that the amounts of interest shall be paid by the respondent promoter to the said complainants after obtaining the full occupancy certificate.

 MahaRERA - To ensure that the said project is not jeopardized due to the outflow of finances it is directed that the amounts of interest shall be paid by the respondent promoter to the said complainants after obtaining the full occupancy certificate.

Anil Kumar Dattani Versus Real Gem Buildtech Private Limited & Ors. Complaint No. CC006000000292852 Before the Maharashtra Real Estate Regulatory Authority Mumbai Decided on 13th May 2024)

Fact of the Case :-

• Respondent no. 1 i.e. Realgem Buildtech Private Limited  is the Promoter of the project.
• Respondent no. 2 i.e. Bhishma Realty Limited is the landowner of the project.
• Respondent no. 3 i.e Kindmaker Developers Private Limited  has been appointed as a Development Manager under the development management agreement dated 18-03-2018 and is basically an agent of the respondent no. 1 functioning for a fixed fee. the respondent no. 3 was appointed for the purposes of 
• inter alia managing, 
• monitoring, 
• supervising and 
• coordinating the construction and 
• development of the said project 
• together with the sales and marketing related activities including customer relationship management.

• The subject matter of the case is flat bearing no. 2302 on 23rd floor in the “RUSTOMJEE CROWN - PHASE I" at Prabhadevi, Mumbai.
• On 16-01-2019 The respondent issued  the allotment letter in the complainant's name. 
• On 25-01-2019 The complainant and the respondents entered into a registered agreement for sale.
• The respondent had assured to handover the possession of the said flat on 31-12-2021.
• The Flat was for a total consideration of Rs. 7,69,86,000/-
• The Complainant has already paid Rs. 7,41,83,995/- to the respondents from time to time..
• The respondent did not give the possession by the said date.
• On 27-09-2022 the complainant filed the present complaint..

Submissions by Appellant:-

• As per the RERA, the all 3 respondents are jointly and severally liable as per circular no. 12/2017 dated 04-12-2017.

Submissions by Respondent(s):

• The date of possession mentioned in the agreement for sale is 31-12-2021 and the same was subject to provisions of clause 8 of the said agreement which provides for a reasonable extension on occurrence of mitigating events.
• The Covid 19 pandemic was a force majeure event and therefore covered under clause 8 of the agreement for sale. 

Observations made by the Hon’ble Court:-

• the Respondent nos. 1 and 2 being the promoters of this project registered with the MahaRERA are liable to perform their part as stipulated in the registered agreement for sale dated 25-01-2019 signed with the complainant herein.
• With regards to respondent taking the plea on the issue of jurisdiction as per clause 16.1 of the said agreement for sale wheras the complainant has agreed for arbitration in case of any dispute arising in respect of the said agreement for sale.MahaRERA is of the view that the same is raised at a belated stage by filing its reply on record of MahaRERA,
• Further, there are no explicit provisions under RERA about the arbitration clause. Hence,the same stands rejected.
• As far as the issue raised by the complainant about GST input credit not being provided to him, the MahaRERA is of the prima facie view that the same does not fall within the purview of the MahaRERA under the provisions of the RERA. 
• However, it is for the concerned competent forum to deal with such issues. Hence, the complainant need to approach the appropriate forum for redressal of the said grievances about the GST. 
• The MahaRERA is not going to deal with the said issue for want of jurisdiction.
• the MahaRERA is of the view that the delay cited by the respondent such as delay in obtaining CFO NOC due to change in fire norms and the delay in obtaining NOC from MPCB do not fall within the force majeure factors mentioned in the draft model agreement for sale prescribed under the RERA and the relevant rules made thereunder.

Court’s Order:-

• The respondent promoter is directed to pay interest for the delayed possession to the complainants from 01-01-2023 ( as per agreements for sale i.e. 31-12-2021 + 1 year grace period due to Covid-19 Pandemic i.e. 31-12-2022) for every month till the actual date of possession of the said flat to the complainant or till the date of offer of possession with OC if any obtained by the respondent promoter. 
• to ensure that the said project is not jeopardized due to the outflow of finances it is directed that the amounts of interest shall be paid by the respondent promoter to the said complainants after obtaining the full occupancy certificate.

MAHA RERA - The delay in obtaining NOCs including Fire NOC do not fall within the force majeure factors prescribed under the RERA and the relevant rules made thereunder.

 MAHA RERA - The delay in obtaining NOCs  including Fire NOC do not fall within the force majeure factors prescribed under the RERA and the relevant rules made thereunder.

Anil Kumar Dattani Versus Real Gem Buildtech Private Limited & Ors. Complaint No. CC006000000292852 Before the Maharashtra Real Estate Regulatory Authority Mumbai Decided on 13th May 2024)

Fact of the Case :-

• Respondent no. 1 i.e. Realgem Buildtech Private Limited  is the Promoter of the project.
• Respondent no. 2 i.e. Bhishma Realty Limited is the landowner of the project.
• Respondent no. 3 i.e Kindmaker Developers Private Limited  has been appointed as a Development Manager under the development management agreement dated 18-03-2018 and is basically an agent of the respondent no. 1 functioning for a fixed fee. the respondent no. 3 was appointed for the purposes of 
• inter alia managing, 
• monitoring, 
• supervising and 
• coordinating the construction and 
• development of the said project 
• together with the sales and marketing related activities including customer relationship management.

• The subject matter of the case is flat bearing no. 2302 on 23rd floor in the “RUSTOMJEE CROWN - PHASE I" at Prabhadevi, Mumbai.
• On 16-01-2019 The respondent issued  the allotment letter in the complainant's name. 
• On 25-01-2019 The complainant and the respondents entered into a registered agreement for sale.
• The respondent had assured to handover the possession of the said flat on 31-12-2021.
• The Flat was for a total consideration of Rs. 7,69,86,000/-
• The Complainant has already paid Rs. 7,41,83,995/- to the respondents from time to time..
• The respondent did not give the possession by the said date.
• On 27-09-2022 the complainant filed the present complaint..

Submissions by Appellant:-

• As per the RERA, the all 3 respondents are jointly and severally liable as per circular no. 12/2017 dated 04-12-2017.

Submissions by Respondent(s):

• The date of possession mentioned in the agreement for sale is 31-12-2021 and the same was subject to provisions of clause 8 of the said agreement which provides for a reasonable extension on occurrence of mitigating events.
• The Covid 19 pandemic was a force majeure event and therefore covered under clause 8 of the agreement for sale. 

Observations made by the Hon’ble Court:-

• the Respondent nos. 1 and 2 being the promoters of this project registered with the MahaRERA are liable to perform their part as stipulated in the registered agreement for sale dated 25-01-2019 signed with the complainant herein.
• With regards to respondent taking the plea on the issue of jurisdiction as per clause 16.1 of the said agreement for sale wheras the complainant has agreed for arbitration in case of any dispute arising in respect of the said agreement for sale.MahaRERA is of the view that the same is raised at a belated stage by filing its reply on record of MahaRERA,
• Further, there are no explicit provisions under RERA about the arbitration clause. Hence,the same stands rejected.
• As far as the issue raised by the complainant about GST input credit not being provided to him, the MahaRERA is of the prima facie view that the same does not fall within the purview of the MahaRERA under the provisions of the RERA. 
• However, it is for the concerned competent forum to deal with such issues. Hence, the complainant need to approach the appropriate forum for redressal of the said grievances about the GST. 
• The MahaRERA is not going to deal with the said issue for want of jurisdiction.
• the MahaRERA is of the view that the delay cited by the respondent such as delay in obtaining CFO NOC due to change in fire norms and the delay in obtaining NOC from MPCB do not fall within the force majeure factors mentioned in the draft model agreement for sale prescribed under the RERA and the relevant rules made thereunder.

Court’s Order:-

• The respondent promoter is directed to pay interest for the delayed possession to the complainants from 01-01-2023 ( as per agreements for sale i.e. 31-12-2021 + 1 year grace period due to Covid-19 Pandemic i.e. 31-12-2022) for every month till the actual date of possession of the said flat to the complainant or till the date of offer of possession with OC if any obtained by the respondent promoter. 
• to ensure that the said project is not jeopardized due to the outflow of finances it is directed that the amounts of interest shall be paid by the respondent promoter to the said complainants after obtaining the full occupancy certificate.

Maha RERA - Issue of GST input credit does not fall within the purview of the provisions of the RERA. Hence, the complainant need to approach the appropriate forum for redressal of the said grievances about the GST.

Issue of  GST input credit does not fall within the purview of the  provisions of the RERA. Hence, the complainant need to approach the appropriate forum for redressal of the said grievances about the GST.  

Anil Kumar Dattani Versus Real Gem Buildtech Private Limited & Ors. Complaint No. CC006000000292852 Before the Maharashtra Real Estate Regulatory Authority Mumbai Decided on 13th May 2024)

Fact of the Case :-

• Respondent no. 1 i.e. Realgem Buildtech Private Limited  is the Promoter of the project.
• Respondent no. 2 i.e. Bhishma Realty Limited is the landowner of the project.
• Respondent no. 3 i.e Kindmaker Developers Private Limited  has been appointed as a Development Manager under the development management agreement dated 18-03-2018 and is basically an agent of the respondent no. 1 functioning for a fixed fee. the respondent no. 3 was appointed for the purposes of 
• inter alia managing, 
• monitoring, 
• supervising and 
• coordinating the construction and 
• development of the said project 
• together with the sales and marketing related activities including customer relationship management.

• The subject matter of the case is flat bearing no. 2302 on 23rd floor in the “RUSTOMJEE CROWN - PHASE I" at Prabhadevi, Mumbai.
• On 16-01-2019 The respondent issued  the allotment letter in the complainant's name. 
• On 25-01-2019 The complainant and the respondents entered into a registered agreement for sale.
• The respondent had assured to handover the possession of the said flat on 31-12-2021.
• The Flat was for a total consideration of Rs. 7,69,86,000/-
• The Complainant has already paid Rs. 7,41,83,995/- to the respondents from time to time..
• The respondent did not give the possession by the said date.
• On 27-09-2022 the complainant filed the present complaint..

Submissions by Appellant:-

• As per the RERA, the all 3 respondents are jointly and severally liable as per circular no. 12/2017 dated 04-12-2017.

Submissions by Respondent(s):

• The date of possession mentioned in the agreement for sale is 31-12-2021 and the same was subject to provisions of clause 8 of the said agreement which provides for a reasonable extension on occurrence of mitigating events.
• The Covid 19 pandemic was a force majeure event and therefore covered under clause 8 of the agreement for sale. 

Observations made by the Hon’ble Court:-

• the Respondent nos. 1 and 2 being the promoters of this project registered with the MahaRERA are liable to perform their part as stipulated in the registered agreement for sale dated 25-01-2019 signed with the complainant herein.
• With regards to respondent taking the plea on the issue of jurisdiction as per clause 16.1 of the said agreement for sale wheras the complainant has agreed for arbitration in case of any dispute arising in respect of the said agreement for sale.MahaRERA is of the view that the same is raised at a belated stage by filing its reply on record of MahaRERA,
• Further, there are no explicit provisions under RERA about the arbitration clause. Hence,the same stands rejected.
• As far as the issue raised by the complainant about GST input credit not being provided to him, the MahaRERA is of the prima facie view that the same does not fall within the purview of the MahaRERA under the provisions of the RERA. 
• However, it is for the concerned competent forum to deal with such issues. Hence, the complainant need to approach the appropriate forum for redressal of the said grievances about the GST. 
• The MahaRERA is not going to deal with the said issue for want of jurisdiction.
• the MahaRERA is of the view that the delay cited by the respondent such as delay in obtaining CFO NOC due to change in fire norms and the delay in obtaining NOC from MPCB do not fall within the force majeure factors mentioned in the draft model agreement for sale prescribed under the RERA and the relevant rules made thereunder.

Court’s Order:-

• The respondent promoter is directed to pay interest for the delayed possession to the complainants from 01-01-2023 ( as per agreements for sale i.e. 31-12-2021 + 1 year grace period due to Covid-19 Pandemic i.e. 31-12-2022) for every month till the actual date of possession of the said flat to the complainant or till the date of offer of possession with OC if any obtained by the respondent promoter. 
• to ensure that the said project is not jeopardized due to the outflow of finances it is directed that the amounts of interest shall be paid by the respondent promoter to the said complainants after obtaining the full occupancy certificate.

Maha RERA - There are no explicit provisions under RERA about the arbitration clause in agreement for Sale

There are no explicit provisions under RERA about the arbitration clause in agreement for Sale 

Anil Kumar Dattani Versus Real Gem Buildtech Private Limited & Ors. Complaint No. CC006000000292852 Before the Maharashtra Real Estate Regulatory Authority Mumbai Decided on 13th May 2024)

Fact of the Case :-

• Respondent no. 1 i.e. Realgem Buildtech Private Limited  is the Promoter of the project.
• Respondent no. 2 i.e. Bhishma Realty Limited is the landowner of the project.
• Respondent no. 3 i.e Kindmaker Developers Private Limited  has been appointed as a Development Manager under the development management agreement dated 18-03-2018 and is basically an agent of the respondent no. 1 functioning for a fixed fee. the respondent no. 3 was appointed for the purposes of 
• inter alia managing, 
• monitoring, 
• supervising and 
• coordinating the construction and 
• development of the said project 
• together with the sales and marketing related activities including customer relationship management.

• The subject matter of the case is flat bearing no. 2302 on 23rd floor in the “RUSTOMJEE CROWN - PHASE I" at Prabhadevi, Mumbai.
• On 16-01-2019 The respondent issued  the allotment letter in the complainant's name. 
• On 25-01-2019 The complainant and the respondents entered into a registered agreement for sale.
• The respondent had assured to handover the possession of the said flat on 31-12-2021.
• The Flat was for a total consideration of Rs. 7,69,86,000/-
• The Complainant has already paid Rs. 7,41,83,995/- to the respondents from time to time..
• The respondent did not give the possession by the said date.
• On 27-09-2022 the complainant filed the present complaint..

Submissions by Appellant:-

• As per the RERA, the all 3 respondents are jointly and severally liable as per circular no. 12/2017 dated 04-12-2017.

Submissions by Respondent(s):

• The date of possession mentioned in the agreement for sale is 31-12-2021 and the same was subject to provisions of clause 8 of the said agreement which provides for a reasonable extension on occurrence of mitigating events.
• The Covid 19 pandemic was a force majeure event and therefore covered under clause 8 of the agreement for sale. 

Observations made by the Hon’ble Court:-

• the Respondent nos. 1 and 2 being the promoters of this project registered with the MahaRERA are liable to perform their part as stipulated in the registered agreement for sale dated 25-01-2019 signed with the complainant herein.
• With regards to respondent taking the plea on the issue of jurisdiction as per clause 16.1 of the said agreement for sale wheras the complainant has agreed for arbitration in case of any dispute arising in respect of the said agreement for sale.MahaRERA is of the view that the same is raised at a belated stage by filing its reply on record of MahaRERA,
• Further, there are no explicit provisions under RERA about the arbitration clause. Hence,the same stands rejected.
• As far as the issue raised by the complainant about GST input credit not being provided to him, the MahaRERA is of the prima facie view that the same does not fall within the purview of the MahaRERA under the provisions of the RERA. 
• However, it is for the concerned competent forum to deal with such issues. Hence, the complainant need to approach the appropriate forum for redressal of the said grievances about the GST. 
• The MahaRERA is not going to deal with the said issue for want of jurisdiction.
• the MahaRERA is of the view that the delay cited by the respondent such as delay in obtaining CFO NOC due to change in fire norms and the delay in obtaining NOC from MPCB do not fall within the force majeure factors mentioned in the draft model agreement for sale prescribed under the RERA and the relevant rules made thereunder.

Court’s Order:-

• The respondent promoter is directed to pay interest for the delayed possession to the complainants from 01-01-2023 ( as per agreements for sale i.e. 31-12-2021 + 1 year grace period due to Covid-19 Pandemic i.e. 31-12-2022) for every month till the actual date of possession of the said flat to the complainant or till the date of offer of possession with OC if any obtained by the respondent promoter. 
• to ensure that the said project is not jeopardized due to the outflow of finances it is directed that the amounts of interest shall be paid by the respondent promoter to the said complainants after obtaining the full occupancy certificate.

BOMBAY HIGH COURT - The liability of refund falls upon all the listed promoters even if they may not have received the amount in consideration.

BOMBAY HIGH COURT - The liability of refund falls upon all the listed promoters even if they may not have received the amount in consideration.

Wadhwa Group Housing Private Ltd vs Vijay Choksi & SSS Escatics Pvt. Ltd

SECOND APPEAL (Stamp) NO. 21842 OF 2023

Decided on 26 February 2024

IN THE HIGH COURT OF JUDICATURE AT BOMBAY

Time line of the Matter :-

1. Allottee approached MahaRERA U/s 12 and 18 of the RERA act and sought refund of amount of Rs.2,62,35,056/- along with interest as well as compensation and costs.
2. On 24/09/2021 MahaRERA passed the Order holding that Allottee could not claim any equity under the provisions of act and his prayer for refund was rejected, and directed parties to execute registered agreement for sale within 30 day failing which the entire amount was directed to be refunded to the Allottee within six months.
3. Allottee filed Appeal U/s 43 of the RERA Act before the Appellate Tribunal.
4. On 18/10/2022 Appellate Tribunal partly allowed the appeal and set aside the Order directing both the Builders to Jointly refund the amount paid by the Allottee with interest.
5. Aggrieved by the Appellate Tribunal’s Order to put the liability to refund the amount received by SSS Escatics Pvt. Ltd the other Builder Wadhwa Group Housing Private Ltd chose to file this appeal.

Question of Law Framed in Second Appeal

"Whether a promoter who has not received any consideration from an allottee can be made liable for giving refund with interest under Section 18 of the Real Estate (Regulation and Development) Act, 2016?"

Fact of the Case:-

1. Builder SSS Escatics Pvt. Ltd, launched a project called “The Nest” as a Slum Rehabilitation Scheme.
2. On 05/09/2012 A JDA (Joint Development Agreement) came to be executed between both the Builders SSS Escatics Pvt. Ltd and Wadhwa Group Housing Private Ltd.
3. Under the said JDA Wadhwa and SSS segregated the constructed area amongst themselves for being sold to customers.
4. On 19/07/2013, Allottee booked a 3BHK Flat bearing B-502 admeasuring 2385 sq.ft in the said project for agreed consideration of Rs.2,65,35,000/-
5. Allottee paid an amount of Rs.1,20,00,000/- towards part consideration.
6.  On 24/07/2013 SSS issued allotment letter to Allottee.
7. The project remained incomplete on the date of coming into force of RERA Act, 2016.
8. The project was accordingly registered as ongoing project under Section 3 of the RERA by SSS in which the Wadhwa was declared as a Promoter (Investor).

Submissions by Appellant

1. Wadhwa cannot be held responsible for refund of any amount to the Allottee as he has not paid any amount to the Wadhwa and that therefore there is no question of refunding any amount to him.
2. As per the JDA both builders identified their respective entitlements in constructed portion of the building and the flat in question falls in the share of SSS, and it  alone received the entire consideration from the Allottee thereby no question of Wadhwa refunding the amount which it did not receive.
3. Mere a change in law requiring reflection of name of wadhwa as Promoter does not create its liability, which did not exist prior to introduction of RERA.  

Submissions by Respondent

1. Wadhwa is undoubtedly covered by definition of the term ‘Promoter’ per se Section 2(zk) of RERA.
2. Definition U/s 2(zk) makes it clear that all promoters are jointly liable under the Act.
3. That a promoter cannot be permitted to defeat the rights of the flat purchasers by making internal arrangements with investors, land owners, etc 

observations made by the Hon’ble Court

1. There appears to be no dispute that the payments were made by the Allottee to the SSS.
2. it is necessary to determine whether Wadhwa falls in the definition of the term ‘promoter’.
3. While registering the project as ongoing project under Section 3 of the RERA, Wadhwa’s name has been included in the list of Promoters. Therefore, Wadhwa cannot run away from the fact that it is the promoter in respect of the project ‘The Nest’
4. Mere falling of flat in the share of the SSS under the JDA would not excuse the Wadhwa from the responsibilities and liabilities under the RERA, Rules and Regulations made thereunder qua that flat. 
5. RERA does not demarcate or restrict liabilities of different promoters in different areas and the liability is joint for all purposes under the Act, Rules and Regulations
6.  Since the Wadhwa is covered by definition of the term ‘Promoter’, it is also jointly liable to refund the amount along with the SSS.
7. Distinction between projects launched before and after coming into force of RERA cannot be a ruse to escape the liabilities as promoter under RERA.
8. The Wadhwa’s contention about absence of privity of contract between it and the Complainant is totally misplaced as it is a matter of indoor management between the Promoters and the flat purchaser who is not supposed to know the intricacies of the arrangements made between several promoters amongst themselves.

Court’s Order

Accordingly the Second Appeal is accordingly dismissed with costs.

Chattisgarh RERA Notification on Joint Venture Agreement between Land Owners and Developers

 Joint Venture Agreement between Land Owners and Developers

 Chattisgarh Real Estate Regulatory Authority (RERA) vide circular No./94 /RERA/2023/1956 dated 01/12/2023 directs following clauses to be mandatorily added in the joint venture agreement between the land owners and builders:

1. The land owners and the builders shall be jointly & severally liable to fulfill all obligations under RERA;
2. The Agreement to Sale with the allottee should be signed by both.

Bombay High Court - A license does not create any title in favour of the licensee

 In the Matter of Suresh Malappa Shetty Vs. Special recovery officer, 2002 SCC Online BOM 1054; (2003) 3 Mah LJ 248

A license is treated to be in permissive possession only and possession is regarded to be with the licensor always. This usually happens in the case of joint development agreement / Collaboration agreement / License agreement and it is noteworthy that a license does not create any title in favour of the licensee