Appellate tribunal rules in favour of buyers who opted out of the project and were denied refund
The couple had booked the flat in a project at Jogeshwari in 2019
The Maharashtra Real Estate Regulatory Authority (MahaRERA) tribunal has ordered a developer from Mumbai to refund the booking amount to a couple who failed to get a housing loan and opted out of the project as a result. The tribunal has ordered the developer to refund the amount plus interest calculated from the time of booking in 2019.
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R S Pillai along with his wife R R Pillai had jointly booked a flat in the under-construction project, Avant Heritage, developed by Aishwarya Avant Builders LLP in Jogeshwari. The flat at the time of booking in 2019 was valued at Rs 1.15 crore and the couple had jointly paid over ten per cent Rs 13.50 lakh to the developer.
Attempts by the Pillai couple to avail a housing loan from a leading private bank hit a roadblock as the developer had issued a no-objection letter only in the name of the first applicant (R R Pillai) instead of both of them. The dejected couple decided to withdraw from the project and asked for a refund. When the developer didn’t respond to the couple’s request, they approached MahaRERA.
According to advocate Anil D’Souza, in January 2021, MahaRERA said that no refund can be granted under section 13 of Real Estate (Regulation and Development) Act. The authority directed both parties to register an agreement for sale in accordance with the allotment letter of May 20, 2019, as per section 13 of RERA. In case of failing to register the agreement, the developer will have to refund the money to the complainants, MahaRERA stated in its order. However, the developer did not honour the MahaRERA order.
Advocate D’Souza said the couple challenged the MahaRERA order before the Maharashtra Real Estate Appellate Tribunal, Mumbai. The tribunal in its order (copy with this newspaper) dated September 27 set aside MahaRERA order and directed the developer to refund the amount of Rs 13.50 lakh to appellants along with interest at the rate of 2 per cent.
The other side
The promoter had claimed that the couple had booked the flat under the special discount scheme on the occasion of Akshay Tritya. Owing to the discount, the flat price was reduced from Rs 1.15 crore to Rs 1.04 crore. The discounted price was subject to payment of instalments as per the payment schedule agreed on at the time of booking (Rs 20 lakh by June 10, 2019). Besides the couple agreed to pay an approximate Rs 51.12 lakh at the time of registration of the agreement for sale.
The promoter even argued that timely payments of the remainder of the instalments were the essence of the contract, failing which the discounted and concessional sale rate offered to the customer shall stand withdrawn. In such a scenario, the promoter claimed that the customer shall be liable to pay R1.15 crore, else the allotment shall be terminated, cancelled or revoked and the promoter shall be entitled to forfeit the booking amount.
Appellate authority order
Shriram Jagtab (judge) and Shrikant Deshpande, member (A) observed that as per section 13 of RERA, the promoter cannot accept more than 10 per cent of the cost of the apartment without entering into a written agreement for sale with the buyer. In violation of this provision, the promoter by letter dated June 29, 2019, has again demanded Rs 6.50 lakh from the buyer.
The tribunal observed that there is no express mention in RERA, which entitles the promoter to forfeit an earnest amount on account of cancellation of booking by the buyer. The act is silent on the point of permissible deduction if the buyer or promoter for whatever reason cancels the booking. There is nothing on record to show that because of the cancellation of the booking by buyers, the promoter has suffered damages or loss, the order read.
Advocate speak
Anil D’Souza Advocate
Advocate D’Souza said, “It’s truly a remarkable order where the appellate tribunal has acknowledged the humble allotment letter. There were several violations of Real Estate (Regulation and Development) Act”
Complainant speak
R R Pillai
“We had put in all our life savings [mortgaged gold, broken fixed deposits] to book this under-construction property. We have been fighting for our rightful refund for the last five years and I lost all my hope of getting my money back, as MahaRERA was not entirely in our favour. It was only because of advocate Anil D’Souza, who advised us to challenge the MahaRERA order before the appellate authority that we got our money back. This order has restored my faith in the judiciary and judicial process.”
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