Failure To Hand Over In Time, MahaRERA Directs Goel Ganga To Refund Amount To Homebuyer

Background Facts

The homebuyer (Complainant) booked a flat in the builder's (Respondent) project by signing an agreement for sale on May 30, 2016, whose total price was Rs. 1,20,02,820/-. Out of the total cost, the homebuyer paid Rs. 1,03,90,483/- for the flat, Rs. 7,20,000/- for stamp duty, and Rs. 30,940/- for registration charges.

While signing the agreement, the builder had promised the homebuyer to complete the project on time and had already finished Phase I, handing over possession to the buyers.

Because of this promise, the homebuyer paid the full amount to the builder. According to clause 5 of the agreement for sale, the builder promised to hand over the flat by December 2017. However, the builder failed to do so.

The homebuyer repeatedly asked the builder for a refund, but the builder did not respond. Therefore, the homebuyer filed complaint before the authority seeking a refund, along with interest, compensation, and costs under the provisions of RERA.

Observation and Direction by Authority

The authority observed that the builder, being experienced in the real estate sector, knew the market risks when starting the project and signing the agreement with the homebuyers. Moreover, if the project was delayed for reasons known to the builder, the builder should have informed the homebuyer and updated the possession date in the agreement by signing a rectification deed with the homebuyer.

The authority noted that even if force majeure caused the delay, the promoter could have sought a six-month extension under the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act, 1963 ("MOFA"). This extension would have extended the possession date to June 30, 2018. However, the promoter still failed to complete the project by that date, violating section 18 of RERA. Therefore, the homebuyer is entitled to a refund with interest under section 18 of RERA.

The Authority referred relevant part of Section 18(1) of the Real Estate Regulation and Development Act 2016, which states:

18. Return of amount and compensation.

(1) If the builder 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 homebuyers, 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 ActTop of Form.Bottom of Form

Therefore, the Authority directed the builder to refund the amount paid by the homebuyer to purchase the flat with interest as per section 18 of RERA, 2016.

Case- Dr Anant Bagul Versus Goel Ganga India Pvt Ltd

Citation - Complaint No. CC005000000106646