Five Year Delay In Handing Over Possession, Haryana RERA Orders Raheja Developers To Refund Homebuyers

Background Facts

The homebuyers (complainants) were allotted flats in the builder's (respondent) project named Raheja Revanta, located in Sector 78, Gurugram, through an agreement for sale executed on 17.01.2017. The total consideration for the flat was ₹2,66,61,925, out of which the homebuyers paid ₹1,88,89,764 to the builder.

As per Clause 4.2 of the agreement, the builder was supposed to hand over possession of the flat within two years from the date of the agreement, with a grace period of six months. However, despite receiving 66% of the total consideration from the homebuyers, the builder failed to deliver possession of the flat within the promised time.

The homebuyers contended that they were compelled to pay ₹3,50,000 for covered parking charges, which is against the law since the parking area is part of the common area and cannot be sold separately by the builder.

Feeling aggrieved, the homebuyers filed a complaint before the authority seeking a refund of all the money they paid to purchase the flat, along with interest and ₹1 lakh as litigation costs.

Observation and Direction of Authority

The Authority referred to Clause 4.2 of the Agreement to sell which stipulated that the builder aims to deliver possession of the unit within 36 months for Tapas and 24 months for Surya Tower from the date the agreement is signed.

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 homebuyerss, 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.

The Authority observed that, as per Clause 4.2 of the agreement, the builder was supposed to hand over possession of the flat within 24 months from the date of execution of the agreement. Since the agreement was executed on 17.01.2017, the builder was obligated to hand over possession by 17.07.2019. Therefore, the homebuyers is entitled to a refund of the amount paid, along with interest for the delayed possession, under Section 18(1) of RERA, 2016.

The Authority further noted that even after 5 years, the construction is still incomplete, and the builder has not offered possession to the homebuyers. As a result, the homebuyers cannot be expected to wait indefinitely to receive possession of the flat. Therefore, the Authority directed the builder to refund the amount paid by the homebuyers, with interest at 11% per annum, for the delay in handing over possession.

Case – M/s Sentac India Company Pvt. Ltd. Versus Raheja Developers Limited A/W 1 other

Citation - Complaint No. 3848/2023 and 1 other