Mr. Rahul Mittal vs M/s Yogiraj Promoters Pvt. Ltd.

This complaint (No. 03/01/2025) concerns M/s Yogiraj Promoters Pvt. Ltd. (hereinafter, referred to as ‘Respondents’) demanding over 10% of the unit cost from Mr. Rahul Mittal (hereinafter, referred to as ‘Complainant’) without registering the Agreement for Sale. The Complainant alleges that he booked unit MRC – GF - 312 in the Respondents' ‘Migsun Rohini Central’, by depositing ₹4,60,000/- as booking amount. The Complainant on demand has paid an amount exceeding 10% of the booking cost. Till date, the Complainant has paid an amount of ₹19,28,439/- which constitutes about 40% of the total cost of the unit purchased. Thus, the Complainant claims that he has paid 30% amount, which was not required to be paid before signing Agreement for Sale. The Complainant has prayed for a refund of 30% amount along with interest, which was taken over and above the booking amount of 10%.

Both parties admit that to date, no Agreement for Sale, as prescribed under the Real Estate (Regulation & Development) Act, 2016(hereinafter, ‘RE (RD) Act’ or ‘the Act’), has been executed or registered between the Complainant and the Respondents.

The Complainant alleges that he has paid to the Respondents a sum equivalent to 40% of the total sale consideration pursuant to a demand raised by the Promoter Respondent vide a Payment Requisition Letter dated 18.04.2024.

The Complainant alleges that the acceptance of 40% of the total consideration by the Respondents without a registered Agreement for Sale is a direct violation of the Section 13(1) of the RE (RD) Act, which caps the advance payment at 10% before such an agreement is registered.

The Respondent Promoter, in its defense, argues that the Complainant had willingly opted for a ‘40:30:30’ payment plan. The demand for 40% of the amount was not arbitrary but in accordance with the payment schedule chosen by the Complainant.

The Complainant, while not seeking to withdraw from the project entirely, prays for a refund of 30% of the total sale consideration, along with interest.

For the sake of convenience, the main submissions on behalf of the complainants are summarised as follows:

For the sake of convenience, the main averments on behalf of the Respondents are summarised as follows:

We have perused the documents available on records and heard the arguments of both the parties.

The primary questions for consideration before this Authority are:

Section 13(1) of the RE (RD) Act, 2016 is explicit and unambiguous. It reads:

The language of the statute uses the word "shall" indicating its mandatory nature. The provision serves as a cornerstone of the Act's buyer/allottee protection framework, designed to prevent promoters from collecting substantial sums from homebuyers without a binding, registered contract that clearly defines the rights and obligations of parties.

In the instant case, the Respondents have admitted to accepting 40% of the total price while also admitting that the Agreement for Sale is not yet registered. This is a clear, indisputable contravention of Section 13(1) of the RE (RD) Act.

The Respondent's defense that the Complainant opted for a 40:30:30 payment plan is not a valid defense in law. Parties may freely determine the terms of a Sale Agreement, but, any act of theirs that contravenes the RE (RD) Act, 2016 will be deemed invalid. The act of demanding the payment as per the payment plan is permissible but accepting that amount without registering the Agreement for Sale is a contravention of the Act. The RE (RD) Act, 2016 is a special enactment, and its provisions have an overriding effect over any contractual arrangement that is inconsistent with it. Thus, the acceptance of the payment by the Promoter before the execution of Agreement for Sale is a contravention of Section 13(1) of the RE (RD) Act.

The Promoter Respondents by violating Section 13 of the RE (RD) Act, 2016 have contravened a provision of the Act and can be subjected to Penalty under Section 61 of RE (RD) Act which states:

Therefore, this Authority holds that the Respondent Promoter has violated Section 13(1) of the Act. The Respondents are, therefore, liable to pay penalty for this contravention.

Another issue is that the Complainant is seeking a refund of the 30% amount paid over and above the booking amount, in excess of the statutory limit laid down by Section 13 of the Act. However, it is a settled position of law that the Act, particularly Section 18(1), only envisages a full refund in case of withdrawal from the project. It provides for a refund if the promoter "fails to comply with or is in contravention of any of the terms and conditions of the agreement for sale or the provisions of this Act or the rules and regulations made thereunder".

While Section 18(1) primarily details the allottee's right to withdraw from the project and receive a full refund, the power of this Authority is not circumscribed to only that specific relief. The overarching purpose of the Act is to ensure regulation, transparency, and justice. The Authority is vested with powers under Section 37 to issue directions from time to time to promoters or allottees as it may consider necessary to secure compliance with the Act.

The collection of 40% was as per the payment plan agreed upon by the complainant. It was however, over and above the statutory limit of Section 13 of the Act which prohibits acceptance of more than 10% of the amount by the Promoter, before execution of the Agreement for Sale. It is clearly mentioned in the Welcome Letter dated 04.04.2024 that the Complainant opted for a payment plan of ’40:30:30’. The demand of 40% of the cost was valid as per the payment plan, but, the acceptance of the 30% amount by the Promoter Respondent before execution of Agreement for Sale is evidently a violation of Section 13 of the Act.

We note that the Complainants received the draft of the Agreement for Sale on 15.07.2024. The RE (RD) Act, 2016, prescribe rights and liabilities/duties of the Promoter as well as the Allotees. It is the duty of an Allottee to execute the documents as per the Act and Rules framed thereunder. As per Rule 20 of the NCT of Delhi RE(RD) (Agreement for Sale) Rules, 2016, the Complainant should have taken steps within 30 days for Execution and Registration of the Agreement for Sale. The Complainant was at fault for keeping the Agreement for Sale from 15.07.2024, until now, without signing it.

The Complainant had submitted that the total value of the Unit and the Area promised at the time of booking was different from those mentioned in the Agreement for Sale. Therefore, they did not execute the Agreement for Sale. However, we note that the Complainant have not raised an objection with Promoter Respondent with respect to the cost and area of the Unit. The Customer Ledger dated 05.05.2025, mentions the Carpet Area as 8.72 Square Metres. The Provisional Booking form dated 02.01.2024 which is duly signed by the Complainant clearly mentions the Super Area as 209 Square Feet and Carpet Area as 93 Square Feet. Thus, we find no discrepancy with respect to the space allotted to the Complainant.

Further we note that the Provisional Booking Form dated 02.01.2024, mentions the total cost of the Unit as ₹52,37,853/-, including GST, and the Customer Ledger dated 05.05.2025 also mentions the cost as ₹52,37,850/-, with taxes. However, we note that in the E-mail dated 27.04.2024 sent by the Respondents to the Complainant confirm the cost of the Unit as ₹49,88,431/-, but it is without taxes. If the complainant had any objections with respect to the cost of unit, they should have taken matter to the Respondent. However, the Complainant has not raised any objections with respect to the space and cost of the Unit. Instead, the Complainant withheld the execution of Agreement for Sale. Therefore, we do not see any justification for issuing direction for refund of the amount collected by the Respondent over and above the 10% of the initial payment as refunding the money to them would allow them to profit from their own mistake.

We are of the view that, in the present circumstances, direction for refund of the 30% amount to the complainant would overextend the Authority's residuary powers under Section 37 of the Act.

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 Section 13 of the RE (RD) Act, 2016. However, the Complainant is not entitled to get the refund of the amount paid by him along with the interest, as prayed, as per Doctrine of Reasonableness, good conscience, and principles of natural justice.

In view of the above findings, this Authority finds it just and equitable to penalize the Promoter for contravention of the Provision of the Act but issuing refund of the amount over and above 10% is not justified. However, the parties are directed to register the Agreement for Sale within 45 days of the issuance of this order.

In light of the aforesaid analysis and findings, this Authority, in the interest of justice, hereby orders the following:

The complaint is disposed of accordingly.

No order as to costs.

The file be consigned to the Record Room after due compliance.