Flat Buyers Can’t Seek Relief For Delay After Project Ready: MahaRERA

Flat buyers are not entitled to compensation for delay if the demand is made after the project is complete or handing over possession has begun, said Maharashtra Real Estate Regulatory Authority or MahaRERA.

On November 12, MahaRERA rejected a plea for compensation sought by Ashley Serrao and his father who had purchased a flat in Runwal Greens in Mulund in 2012.

The builder, Propel Developers Pvt Ltd, said the project had already received part occupancy certificate (OC) in July 2018, before the buyers had lodged their complaints and it had also “already offered possession to the complainants”.

In 2018, the Serraos had filed a complaint claiming that the flat possession, as per the agreement for sale, was promised by December 2015, but was offered only on July 11, 2018.

MahaRERA chairperson Gautam Chatterjee said Section 18 (1) (a) of the Rera Act stipulates obligations and liabilities if a promoter fails to complete or is unable to give possession of a flat. If the buyer wishes to withdraw from the project, the builder is liable to return the amount received by him for the apartment, plot, or building as the case may be, with interest, the Act states. And if the buyer wishes to continue in the project, the builder has to pay “an interest for every month of delay, till handing over of the possession”.

Chatterjee, in his order, said: “Simple present tense used in the starting line of Section 18 clearly indicates that the provision shall apply only till the project is incomplete or the promoter is unable to give possession. Once the project is complete or possession is given, the provision ceases to operate.” He ‘advised’ the Serraos to take possession of the flat and make the balance payment.

Counsel for Serraos, Basil Menezes, said they were to make the requisite payment when the builder on July 31, 2018, asked them to pay an additional Rs 10.85 lakh since the flat’s carpet area had increased by 127 sq ft. No explanation or physical examination over the increase was provided, said the Serraos.

But the order stated that an increase in carpet area and price “being covered in agreement for sale, cannot be termed a breach of agreement” and directed the builder to provide a certificate for the added area.

Advocate Anil Dsouza, secretary of the Bar Association of MahaRERA Advocates, said “the now-famous case of Suresh Swamy v Larsen & Toubro in February 2019 was a landmark order on the sanctity of the possession date as per the registered agreement”. “We had filed the Serraos case too and will explore options to file an appeal against this order,” he added.

How To Bring Back The Confidence In Real Estate Buyers?