Delay Of More Than 12 Years In Providing Possession Of Apartment, Rajasthan RERA Directs Sahara Prime City To Refund

Background Facts

The homebuyer (Complainant) booked an apartment in the builder's (Respondent) project named Sahara City Homes, situated in Jaipur. The total sale price of the apartment was Rs 16,75,000/-, out of which the homebuyer paid Rs 12,12,664/- and was allotted the apartment through a letter dated 21.08.2009.

Homebuyer mentioned that despite multiple requests and follow ups builder never executed a sale agreement in favor of the homebuyer. The builder also failed to develop the apartment and common areas and did not give possession within the 38 months promised in the allotment letter.

Therefore, aggrieved by the delay of more than 12 years in the completion of the project, the homebuyer filed a complaint before the authority seeking a refund of the amount with interest.

Contentions of Sahara

Sahara contended that, on 21.11.2013, Supreme Court passed an order prohibiting all transactions of the Sahara group of companies and directed SEBI to control these transactions, including those related to the construction, development, and possession of the project.

Further, Sahara proposed two options to resolve the issue:

1. Option A: If a homebuyer consents in writing to proceed with their booking and pays the outstanding amount then they will complete and register the apartment within six months.
2. Option B: If a homebuyer prefers a refund then they will return the principal amount along with interest calculated from the date of deposit until 31st March 2024. The refund will be paid in 36 monthly installments at an interest rate of 7% per annum starting from January 2025.

Observation and Direction by Authority

The authority held that since the project has not been completed to date it falls under the definition of an ongoing project and therefore falls under the purview of RERA.

Authority referred to the Supreme Court decision in M/s Newtech Promoters and Developers Pvt. Ltd vs. State of Uttar Pradesh & Ors (LL 2021 SC 641), where it was held that if the builder fails to handover the possession of the apartment, plot, or building within the time stipulated under the terms of the agreement, then the homebuyer's right under the RERA, 2016 to seek a refund or claim interest for delay is unconditional and absolute.

As a result of it, the authority directed builder to refund Rs. 12,12,664/- paid by the homebuyer in order to purchase the apartment, with an interest rate of 11.10% per annum from due date of possession (21.10.2012) till the date of refund.

Case – Mustafa Khan & Others Versus Sahara Prime City Limited

Citation – Comp. No. RAJ-RERA-C-N-2024-7477

Date of order – 29.10.2024