MahaRERA Orders Gaurang Associates To Pay Interest To Homebuyer, Rejects Health Issue Of Builder As Force Majeure Event

Background Facts

The homebuyer (Complainant) initially booked two flats (501/502 and 402) in the builder's (Respondent) project named Tulsi Vrindavan Society. For flat 501/502, the homebuyer signed a sale agreement on November 28, 2017, and completed the full payment as per the agreement's terms. As per the agreement, the builder was supposed to hand over the flat by June 30, 2018.

Regarding flat 402, although the homebuyer paid the full amount, no sale agreement was executed by the builder initially. Later, at the builder's request, the sale deed for flat 501/502 was canceled, and on March 30, 2022, sale deeds for flats 603 and 402 were registered.

The homebuyer raised concerns about flat 402, after finding a significant deviation from the floor plan, including a pillar in the middle of the living room. The builder assured compensation for these discrepancies but did not follow through.

Furthermore, members of the previous Tulsi Vrindavan society initiated reconciliation proceedings with MahaRERA. During reconciliation on February 22, 2019, the builder assured possession by July 2019, which was not fulfilled.

As a result, the homebuyer filed a complaint seeking the execution of a sale agreement for flat 402 and requesting possession, along with claims for interest due to delays, compensation for discrepancies, and rental losses incurred for both flats.

Observation and Direction by Authority

The authority observed that due to changes in the Unified Development Control and Promotion Regulations (UDCPR) brought by the Maharashtra government to govern real estate development, the builder canceled the agreement for sale dated 20.11.2017, which was executed for flat no. 501/502. In place of that, a new flat (No. 603) was allotted to the homebuyer.

The authority further observed that the builder and the homebuyer signed the agreement for the sale of both flats (603 and 402) on 30.03.2022. Therefore, the authority held that the homebuyer's prayer for the execution of the agreement for sale for flat no. 402 had been fulfilled.

Regarding the issue of interest, the authority observed that as per clause 6 of the agreement for sale signed on 30.03.2022, the builder was supposed to hand over possession of both flats by 31.12.2022. Therefore, the authority held that the builder has violated section 18 of the Real Estate (Regulation & Development) Act, 2016.

Furthermore, the authority rejected the builder's contention that the project was delayed due to the health issues of one of its partners. MahaRERA concluded that this reason does not fall within the force majeure factors that could justify the delay.

Consequently, the authority directed the builder to pay interest to the homebuyer from the possession date (01.01.2023) until the date the occupancy certificate was granted (08.01.2024).

Case – Atul Avinash Dixit Versus Gaurang Associates

Citation - Complaint No. CC006000000209623