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Judgment
A complaint was filed in Form ‘M’ on 01.12.2023 by Mr. Chandan Kumar Mishra & Ms. Nikita (hereinafter referred to as ‘Complainants’) stating that in the year 2015, they booked an apartment in the project “Antriksh Urban Greek” (hereinafter referred to as “project”) in L-Zone, Dwarka, Delhi promoted by “M/s Antriksh Group” (hereinafter referred to as “Respondents”).
The Complainants submitted that they booked a flat in the subject project and paid a sum of Rs 8,29,000/- (Rupees Eight Lakh and Twenty-Nine Thousand Only) to the Respondents.
The Complainants have placed on record copies of Welcome Letter dated 19.11.2015 and receipts which clearly shows that the Respondents collected money for constructing flats in their project “Antriksh Urban Greek”.
The Complainants submitted that no construction has yet been started in 3 years and also the Respondents did not even have the land transfer certificate in their name and thus fraud is committed upon the Complainants. Therefore, they sought refund of the amount paid to Respondents as well as compensation.
A preliminary hearing in the case was held on 12.02.2024. Notice of complaint was sent to the Respondents on 23.02.2024 via registered post and on 27.02.2024 via e-mail.
The matter was subsequently heard on 18.04.2024, 09.07.2024 and 05.09.2024. The Respondents filed their reply on 09.07.2024.
We have heard the arguments and perused the records. For the sake of convenience, the arguments and submissions made on behalf of the Respondents are summarized as under:
The Respondents have been in the business of construction and development for more than a decade and have successfully delivered projects in the NCR region and are developing many projects which are near completion in accordance with law.
In the year 2015, the Respondents launched a project namely ‘Antriksh Urban Greek’. The Complainants approached the Respondents for booking a residential apartment in the said project and accordingly they signed and executed booking application form out of their own free will.
The Respondents had every intention to develop the said project but owing to the government policies and procedural and administrative delays beyond the control of the Respondents, the Respondents could not obtain the Land Transfer Certificate, which was a prerequisite for developing the project. As soon as the Respondents realized that the project was being delayed, they gave an option to its existing investors to either stay invested and await the requisite clearances from the competent authorities or, in an alternative opt for a refund. The Complainants opted for a refund out of their own free will.
The Respondents are ready to refund the balance amount of Rs. Rs 8,29,000/- (Rupees Eight Lakh and Twenty-Nine Thousand Only) to the Complainants on an equitable monthly installment basis.
Analysis and Consideration
The complainants have claimed compensation and sought refund as well. At the very outset, it is pertinent to shed light on the issue whether compensation can be granted by the Authority. The Hon'ble Apex Court in the case of M/s. Newtech Promoters and Developers Pvt. Ltd vs. State of UP & Ors. (CIVIL APPEAL NO(S). 6745 6749 OF 2021) has categorically held, "when it comes to a question of seeking the relief of adjudging compensation and interest thereon under Sections 12, 14, 18, and 19, the adjudicating officer exclusively has the power to determine, keeping in view the collective reading of Section 71 read with Section 72 of the Act." It is thus clear that the Authority does not have the power to grant the relief of compensation under Section 18 of The Act. As per Section 71, the complainants may approach the Adjudicating Officer for the grant of damages and compensation. In view of the same, we are not considering the relief as to compensation in the present order.
A perusal of the documents available on record shows that the Respondents have issued two receipts dated 02.09.2015 and 10.05.2015 acknowledging deposits of Rs. 4,14,000/- and Rs. 4,15,000/- respectively. Hence, a total payment of Rs 8,29,000/- (Rupees Eight Lakh and Twenty-Nine Thousand Only) by the Complainants to the Respondents is a recorded fact.
The RE (RD) Act, 2016 has been enacted to induct professionalism and standardization in the real estate sector, paving the way for catalyzing investments and accelerating growth of the sector in the long run. To achieve these objectives, the Act created a Regulatory Authority to supervise the conception, initiation and completion of a real estate project. The RE (RD) Act, 2016 is a special law enacted to address issues in the real estate sector. Therefore, all disputes between homebuyers/allottees and promoters/developers relating to any real estate project covered under RE (RD) Act of 2016, can be raised before the concerned Real Estate Regulatory Authority (RERA). Section 79 of the RE (RD) Act, 2016 even bars jurisdiction of civil courts to entertain any suit or proceeding in respect of any matter which the Authority is empowered under the Act to determine. Moreover, section 89 of RE (RD) Act, 2016 says that provisions of this Act shall have an overriding effect on anything inconsistent in any other law in force.
An exhaustive definition of "promoter" is provided under section 2(zk) of the Real Estate (Regulation and Development) Act, 2016 (hereinafter referred to as “RE (RD) Act, 2016 or Act”) which is reproduced below:
2.(zk) “promoter” means, -
i)a person who constructs or causes to be constructed an independent building or a building consisting of apartments, or converts an existing building or a part thereof into apartments, for the purpose of selling all or some of the apartments to other persons and includes his assignees; or
ii) a person who develops land into a project, whether or not the person also constructs structures on any of the plots, for the purpose of selling to other persons all or some of the plots in the said project, whether with or without structures thereon; or
iii) any development authority or any other public body in respect of allottees of-
(a)buildings or apartments, as the case may be, constructed by such authority or body on lands owned by them or placed at their disposal by the Government; or
(b)plots owned by such authority or body or placed at their disposal by the Government, for the purpose of selling all or some of the apartments or plots; or
iv) an apex State level co-operative housing finance society and a primary co-operative housing society which constructs apartments or buildings for its members or in respect of the allottees of such apartments or buildings; or
v)any other person who acts himself as a builder, coloniser, contractor, developer, estate developer or by any other name or claims to be acting as the holder of a power of attorney from the owner of the land on which the building or apartment is constructed or plot is developed for sale; or
vi) such other person who constructs any building or apartment for sale to the general public.
Explanation. - For the purposes of this clause, where the person who constructs or converts a building into apartments or develops a plot for sale and the persons who sells apartments or plots are different persons, both of them shall be deemed to be the promoters and shall be jointly liable as such for the functions and responsibilities specified, under this Act or the rules and regulations made thereunder;
The Respondents, thus, fall well within the definition of promoter and are therefore under all the obligations and liabilities of ‘promoter’ under the RE(RD) Act, 2016.
It must be appreciated that the statement of objects and reasons of RE(RD) Act, 2016 clearly states that the Act attempts to balance the interests of consumers and promoters by imposing certain responsibilities on both. It also seeks to establish symmetry of information between the promoter and purchaser, enhance transparency of contractual conditions, set minimum standards of accountability and a fast-track dispute resolution mechanism.
An allottee/house buyer can seek refund of amount invested with promoter under section 18 of RE(RD) Act, 2016, if the promoter fails to complete project by the date specified in agreement to sale with interest including compensation and also under section 12 of RE(RD) Act, 2016 if he/she was misled by any information furnished by promoter with regard to the proposed project either through advertisement or otherwise.
In the present complaint, the Complainants intend to withdraw from the said project and are seeking refund of the amount paid to Respondents in respect of subject unit under section 18(1) of the RE(RD) Act, 2016 on account of delay which reads as under:
“Section 18. Return of amount and compensation. -
18(1). If the promoter 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 allottees, 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.”
Section 12 of the RE(RD) Act, 2016 casts a duty upon the promoter to provide correct and updated information to allottees regarding the project. It reads as under:
“Section 12. Obligations of promoter regarding veracity of the advertisement or prospectus. -
Where any person makes an advance or a deposit on the basis of the information contained in the notice advertisement or prospectus, or on the basis of any model apartment, plot or building, as the case may be, and sustains any loss or damage by reason of any incorrect, false statement included therein, he shall be compensated by the promoter in the manner as provided under this Act:
Provided that if the person affected by such incorrect, false statement contained in the notice, advertisement or prospectus, or the model apartment, plot or building, as the case may be, intends to withdraw from the proposed project, he shall be returned his entire investment along with interest at such rate as may be prescribed and the compensation in the manner provided under this Act.”
The Respondents, in complete disregard to their duties, not only failed to furnish correct information to the Complainants but also misled them by concealing information that their project cannot be completed well within the time limit given to the allottees.
The law is well settled that the allottees/homebuyers hold an unqualified right to seek refund of the amount with interest at such rate as may be prescribed in this behalf. A conscious decision has been taken by the legislature to cast an obligation upon the promoter to refund the amount on demand along with interest at rate prescribed. It has also been held through the recent judgments of the Hon’ble Supreme Court that the Regulatory Authority has exclusive jurisdiction to direct refund of the amount, and interest on the refund amount to the allottees. (Vide: Imperia Structures Ltd. Vs. Anil Patni and Another, 2020 (10) SCC 783, and Newtech Promoters and Developers Pvt. Ltd. v. State of UP And Ors. LL 2021 SC 641).
On perusal of the documents on record and submissions made by both the parties, the Authority is of view that the Respondents are in contravention of the sections 18 and 12 of RE (RD) Act, 2016. As such, the Complainants are entitled to get the refund of the amount paid by them along with the interest at prescribed rate @ 10.75% p.a. (i.e., MCLR plus 2%) as per provisions of section 18 and 12 of RE (RD) Act, 2016 read with Rule 15 of the NCT of Delhi RE(RD) (General) Rules, 20161.
In the light of the aforesaid, we are of the view that Complainants are entitled for refund of the remaining amount proved to be deposited with the Respondent. Accordingly, we direct the Respondents M/s Antriksh Group to refund the entire amount of Rs 8,29,000/- (Rupees Eight Lakh and Twenty-Nine Thousand Only) to the Complainants i.e. Mr. Chandan Kumar Mishra & Ms. Nikita within 45 days of issuance of this order along with interest at the rate of 10.75% per annum (MCLR+2%) from the date of payment of each sum until the date of its actual return.
The case is disposed of accordingly.
No order as to costs.
Footnotes
- 1.The National Capital Territory of Delhi Real Estate (Regulation and Development) (General) Rules, 2016