Karnataka RERA Orders Refund To Homebuyer After Builder Refuses To Register Sale Agreement Despite Receiving Over 10% Of Flat's Cost
Karnataka Real Estate Regulatory Authority (Authority) bench, comprising Neelmani N Raju (Member), has directed the builder, Suvilas Realities, to refund the amount paid by the homebuyer to purchase a flat in their project after the builder refused to register the agreement for sale despite receiving more than 10% of the total cost of the flat.
Background Facts
The homebuyer (Complainant) booked a flat on the 14th Floor of Tower-02 in the builder's project named “The Poem by Shriram Properties” by entering into an agreement for sale on 17/04/2023. To purchase the flat, the homebuyer paid a total amount of ₹9,01,040 to the builder.
The homebuyer contended that the builder, even after collecting more than 10% of the total cost of the flat, refused to register the agreement for sale. Consequently, the homebuyer decided to cancel the booking and demanded a full refund.
Therefore, the homebuyer filed complaint before the authority, seeking a refund of the amount with interest.
Observation and Direction by Authority
The authority observed that it is evident the builder collected more than 10% of the total sale consideration value without registering the agreement for sale, which violates Section 13(1) of the Real Estate (Regulation and Development) Act, 2016. Therefore, the homebuyer are entitled to a refund of the full amount with interest.
Section 13(1) of the RERA Act stipulates that a promoter shall not accept more than ten percent of the cost of the apartment, plot, or building as an advance payment or application fee from a person without first entering into a written agreement for sale with that person and registering the agreement under the relevant law.
The Authority referred to the Supreme Court decision in M/s Newtech Promoters and Developers Pvt. Ltd vs. State of Uttar Pradesh & Ors, where it was held that if the promoter fails to give possession of the apartment, plot, or building within the time stipulated under the terms of the agreement, then the allottee's right under the Act to seek a refund or claim interest for delay is unconditional and absolute, regardless of unforeseen events or stay orders of the Court/Tribunal.
Therefore, the Authority directed the builder to pay the sum of ₹9,40,912 towards refund, with interest, to the homebuyer within 60 days.
Case – Amrendra Kumar Singh Versus M/s. Suvilas Realities Private Limited
Citation - Complaint No: 00902/2023