THE Bombay High Court recently upheld the Maharashtra Real Estate Regulatory Authority (MahaRERA) and MahaRERA Appellate Tribunal order and directed an errant 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 had ordered the developer to refund the amount plus interest calculated from the time of booking in 2019.
The Bombay High Court also levied a cost of R1 lakh (to be paid to the respondent) on the errant developer in driving the respondents (flat buyers) to unnecessary litigation before the appellate tribunal and now before the high court.
The case:
In 2019, R S Pillai and his wife R R Pillai jointly booked flat 1603 in Avant Heritage, an under-construction project by Aishwarya Avant Builders LLP in Jogeshwari, valued at R1.15 crore. They paid over 10 per cent, R13.50 lakh, to the developer. Their attempt to secure a housing loan failed as the developer issued a no-objection letter only in R R Pillai’s name, not both. Opting to exit, they sought a refund, but the developer didn’t respond. Approaching MahaRERA, the couple won a refund order with 2 per cent interest from the appellate tribunal. The developer then contested this in the Bombay High Court.
Court observation
The high court noted in its ruling that the appellant developer showed no genuine intent to pursue the initial option provided by MahaRERA, which required the execution of a registered agreement for sale. There is no evidence in the records to suggest that, after the MahaRERA order was issued on January 12, 2021, the appellant made any effort, such as sending correspondence to the respondents, to express its willingness to proceed with the registered agreement for sale. Consequently, it is clear that the appellant lacked any real interest in fulfilling this obligation following the order dated January 12, 2021.
Court order
The court levied a penalty of R1 lakh on the appellant developer and concluded the second appeal. It directed the appellant to pay the full amount stipulated in the appellate tribunal’s order, along with the costs to the respondents by April 15, 2025, at the latest.
Respondent speak
“I am very happy and overjoyed and really believe that justice is delayed but not denied. After six years I got justice” said R Pillai
Advocate speaks
Builders can’t get away with, forfeiting the flat purchaser’s money on any flimsy excuse. As it is they delay completion of the project and possession and on top of that they penalise the allottees for no fault of theirs,” said Adv Anil D’Souza, Bar Association of MahaRERA, advocate on record for the respondent in the case.
“This order will reinforce flat purchasers’ belief in MahaRera orders and will ensure more people stand up to truant builders who unjustly enrich themselves with the booking amount or further payments made by purchasers. This is a well-fought and hard-earned victory for the institution of justice itself,” Adv D’souza added.
