Haryana RERA Directs Ambience Projects To Hand Over Possession To Homebuyers, Pay Interest For Delay

Background Facts

The homebuyer (Complainant) was allotted a flat in the builder's (Respondent) project named The Creacions in Sector 22, Gurugram, for a total sale price of Rs. 1,14,76,080/-.

On 09.02.2017, the homebuyer and the builder signed an apartment buyer's agreement. According to Clause 11(a) of the agreement, the builder had to finish construction and hand over the flat within 60 months, making the possession date 09.02.2022.

However, despite the homebuyer paying Rs. 1,29,40,021/- to the builder, the builder failed to provide possession of the flat on time. According to the homebuyer, the project was nowhere near completion even before the outbreak of the COVID-19 pandemic in India. There has been a delay of more than one year from the due date of possession on the part of the builder.

Therefore, aggrieved by the delay, the homebuyer filed a complaint before the authority seeking possession of the flat and interest for the delay.

Contentions of Builder

The builder contended that there was no delay in completing the project. As per Clause 11(a) of the apartment buyer agreement, the builder aimed to complete construction within 60 months from the signing of the agreement, barring any force majeure conditions. Due to COVID-19 and construction stoppages from pollution, RERA extended the deadlines to 24.09.2020, then to 30.06.2021, and finally to 29.09.2023.

The builder completed the project within these extended deadlines and applied for the occupancy certificate on 05.09.2022.

Observation and Direction by Authority

The authority rejected the builder's request for COVID-19 related leniency, holding that the builder-buyer agreement was executed on February 9, 2017, and according to the agreement, the possession date was February 9, 2022. Since the COVID-19 outbreak occurred in 2020, the builder cannot claim benefits for their own wrongdoing.

The Authority referred to 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 Act:

Provided that where an allottee does not intend to withdraw from the project, he shall be paid, by the builder, interest for every month of delay, till the handing over of the possession, at such rate as may be prescribed.

Therefore, the authority directed the builder to pay interest to the homebuyer for the delay in handing over possession at the rate of 10.85% per annum. Additionally, the authority also directed the builder to hand over physical possession of the flat to the homebuyer within 30 days.

Case - Rohit Madhok & another Versus M/s Ambience Projects and Infrastructure Pvt. Ltd.

Citation - Complaint no: 5220 of 2023

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