Haryana RERA Directs Ocean Seven Buildtech To Pay Interest To 15 Homebuyers Of Expressway Towers For Delayed Possession

The project was an affordable housing project, and possession was expected to be handed over by the builder within 4 years from the date of building plan approval or environmental clearance, whichever is later.

Background Facts

The homebuyer (Complainant) was allotted a flat in the builder's (Respondent) affordable housing project named Expressway Towers, situated in Sector 109, Gurugram, through a letter on September 25, 2019. Subsequently, both parties entered into the builder-buyer agreement on May 25, 2019.

The homebuyer contended that the builder violated Section 1(iv) of the Affordable Housing Policy, 2013, by failing to provide possession of the flat within four years from the approval of the building plan or grant of environmental clearance, whichever is later.

Furthermore, the homebuyer claimed that the builder failed to comply with all the terms of the agreement and the Affordable Housing Policy, which caused the homebuyer to face numerous hardships. Therefore, the homebuyer filed a complaint before the authority seeking delay interest from the builder under Section 18(1) of RERA, 2016.

Observation and Direction by Authority

The authority referred to Clause 1(iv) of the Affordable Housing Policy, 2013, which stipulates that all projects must be completed within four years from the date of building plan approval or environmental clearance, whichever is later.

The Authority referred to Section 18(1) of the Real Estate Regulation and Development Act 2016, which reads as follows:

18. Return of amount and compensation.

(1) If the promoter fails to complete or is unable to give possession of an apartment, plot, or building, —

(a) in accordance with the terms of the agreement for sale or, as the case may be, duly completed by the date specified therein; or

(b) due to discontinuance of his business as a developer on account of suspension or revocation of the registration under this Act or for any other reason, he shall be liable on demand to the allottees, in case the allottee wishes to withdraw from the project, without prejudice to any other remedy available, to return the amount received by him in respect of that apartment, plot, building, as the case may be, with interest at such rate as may be prescribed in this behalf including compensation in the manner as provided under this Act:

Provided that where an allottee does not intend to withdraw from the project, he shall be paid, by the promoter, interest for every month of delay, till the handing over of the possession, at such rate as may be prescribed.

The authority observed that since the builder obtained environmental clearance on November 30, 2017, the due date for possession, including a six-month extension granted due to the COVID-19 outbreak, would be May 30, 2022. Therefore, the authority held that the builder is liable to pay interest to the homebuyer under Section 18(1) of the Real Estate (Regulation & Development) Act, 2016.

Hence, the authority directed the builder to pay interest to the homebuyer from the possession date (May 30, 2022) until the date the builder makes a valid offer of possession to the homebuyer, plus an additional two months. Furthermore, the authority also directed the builder to execute a conveyance deed in favor of the homebuyer.

Case – Rameshwar Singh Versus Ocean Seven Buildtech Pvt. Ltd. A/w 14 others

Citation - Complaint no. 7964 of 2022 and 14 others