Himachal RERA Penalizes Builder For Advertising And Selling Flat Without Registration

Background Facts

The complainant filed a case accusing the builder of being engaged in the advertisement, marketing, and sale of properties within the "New Una" project in Una, H.P., without registering the project with the relevant authority as mandated by the RERA, 2016. The complainant alleged that 10 plots had been sold without proper registration, violating Section 3 of the Act.

Upon receiving the complaint, the Authority took suo moto cognizance and issued notices to the builder. During a hearing, the builder''s counsel admitted the necessity of project registration and requested time for compliance. The builder was granted time with the condition to register the project and was restrained from further sales until registration.

Despite the initial grace period, subsequent orders were issued as the project remained unregistered. Therefore, on 17.10.2022, the builder was penalized and given another opportunity to apply for registration under the Act. Further delays ensued as the builder sought additional time on 10.11.2022.

Even after initiating the registration process, deficiencies were noted in the application, including incomplete promoter details, discrepancies in land area, and inadequate documentation regarding regulatory approvals. The builder was directed to provide a sworn affidavit disclosing all relevant property details and sales activities.

Contention of Builder

Builder contended that the complaint has failed to establish a cause of action, asserting that complaints before RERA can only be filed by an aggrieved person, a status which the complainant does not possess.

Additionally, Builder argued that the complaint was solely directed against her, without implicating the relevant company, "Group Colonizers Pvt. Ltd." Furthermore, Builder pointed out that "Group Colonizers Pvt. Ltd." had been deregistered since 2019, rendering it legally non-existent. Consequently, Builder contended that targeting her personally, without involving the defunct company, is erroneous and lacks legal basis.

RERA Order

The Authority penalizes the builder with a 13-lakh penalty for advertising and selling the flat without registering it under Section 3 of RERA 2016. The Authority further provided the last opportunity to register the project under RERA within one month.

The Authority further held that violation of Section 3 can be brought to notice by any person and that the definition of an aggrieved person is relevant for the purpose of filing a complaint under Section 31 and not for providing information of violation of Section 3 of the RERA 2016.

To come to a conclusion, the Authority referred to relevant parts of Section 3 of The Real Estate (Regulation and Development) Act, 2016, which is read as follows:

3. Prior registration of real estate project with Real Estate Regulatory Authority

(1) No promoter shall advertise, market, book, sell or offer for sale, or invite persons to purchase in any manner any plot, apartment or building, as the case may be, in any real estate project or part of it, in any planning area, without registering the real estate project with the Real Estate Regulatory Authority established under this Act.

Regarding the issue of the Respondent not implicating the Builder's Company in the complaint, the Authority held that since all the sale deeds have been executed by the builder, the issue of summoning the Company "Group Colonizers Pvt. Ltd." does not arise in this case.

Case – Bhawak Prashar Versus Smt. Indu Walia

Citation - Complaint no.HPRERA2022029/C