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Judgment
A complaint was filed in Form ‘M’ on 24.06.2024 by Ms. Chandrakanta Rawat (hereinafter referred to as ‘Complainant’) stating that in the year 2019, she booked an apartment in their project namely “CGHS Home” (hereinafter referred to as “project”) promoted by “M/s Experia Boulevard Multistate CGHS Ltd.” (hereinafter referred to as “Respondents”) in Dwarka, Delhi.
The Complainant booked a 2 BHK Apartment admeasuring 64 sq.mtrs. in “CGHS Home” project and paid a sum of Rs. 5,57,100/- (Rupees Five Lakh Fifty-Seven Thousand and One Hundred Only) to the Respondents.
For the sake of convenience, the arguments and submissions made on behalf of the Complainant are summarized as under:
a. The complainant, Ms. Chandrakanta Rawat, booked a 2 BHK apartment from Experia Boulevard Multi States CGHS Ltd. in Dwarka, Delhi in December 2018.
b. Despite multiple follow-ups, the Respondents have failed to hand over possession of the apartment and there is no development in the project.
c. The complainant alleged that the Respondents misled her by making false representations, deliberately avoided returning her money or providing the apartment, and committed fraud and redirected her money.
d. Consequently, the complainant is seeking a full refund of his deposited amount, along with interest from the Respondents.
A preliminary hearing in the case was held on 12.08.2024. Notice of complaint was sent to the Respondents on 21.08.2024 via post and on 23.08.2024 via email.
The matter was subsequently heard on 15.10.2024, 18.12.2024, 04.03.2025 and 24.04.2025. The Respondents filed their reply on 18.12.2024. The Complainant filed the rejoinder on 04.03.2025.
For the sake of convenience, the arguments and submissions made on behalf of the Respondent Society are summarized as under:
The Respondents have been in the business of the 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.
The Respondents launched project namely ‘CGHS Home’. The Complainant 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, they could not obtain the Land Transfer Certificate, which was a prerequisite for developing the project. As soon as the Respondents realized that the project is 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 Complainant opted for refund out of their own free will.
The Respondents are ready to refund the entire principal amount of Rs. 2,76,000/- (Rupees Two Lakh and Seventy-Six Thousand Only) to the Complainant.
We have heard the arguments of Ld. Counsels of both the parties and perused the records.
Analysis and Consideration
In the present matter, the Respondents admitted to pay only Rs. 2,76,000/- to the complainant of which receipts have been annexed by the complainant in her Form M complaint.
A perusal of the documents available on record shows that the Respondents have issued three receipts dated 29.03.2019, 17.04.2019 and 17.04.2019 acknowledging deposits of Rs. 2,81,100/-, Rs. 2,32,000/- and Rs. 44,000/-respectively. Hence, a total payment of Rs. 5,57,100/- (Rupees Five Lakh Fifty-Seven Thousand and One Hundred Only) by the Complainants to the Respondents is a recorded fact.
It must be appreciated that the RE (RD) Act, 2016 was enacted to induct professionalism and standardization in the real estate sector, thus paving way for accelerated growth and investments in the sector is long run. The RE (RD) Act, 2016 is a special law enacted to address issues in the real estate sector. All disputes between homebuyers/allottees and promoters/developers relating to any real estate project, covered under the 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 this Authority is empowered by or 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.
As per 2 (zk)(iv) of the RE (RD) Act 2016, promoter means
“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;
Therefore, the Respondent Cooperative Housing Society falls within the definition of "promoter" as provided in Section 2 of the Real Estate (Regulation and Development) Act, 2016.
Furthermore, the issue of whether a Multistate Co-operative Society falls under the purview of the RE (RD) Act, 2016, has been thoroughly discussed by the Hon’ble Real Estate Appellate Tribunal (‘REAT’), Delhi, in its order dated 12.05.2023, in the case titled Jeevan Ashray Welfare Society Vs. Diwakar Garg. The relevant paragraph of the said order reads as follows:
“15.A literal interpretation of the definition of promoter under Section 2(zk) itself is clear and apparent, notably sub-clause (iv) which provides for an Apex State Level Cooperative Housing Finance Society and a Primary Cooperative Housing Finance Society, similar to the appellant society, which constructs apartments or buildings for its Members to be a promoter. Section 2(zg) of the Act, which defines the word ‘Person’ used while defining the word ‘Promoter,’ reinforces the above position of law. The appellant society is registered under the Societies Registration Act, 1860, and their activity as a society is confined to constructing a ‘real estate project,’ as defined under Section 2 (zn) comprising apartments for its members. The appellant society has a large number of members, who have been solicited for membership on assurances of a plot of land on a share of plot of land and an apartment to be constructed by the society. The appellant society admits having purchased land for development and construction of apartments and such activity makes them amenable to the Real Estate (Regulation and Development) Act, 2016, and for prior registration of their project under Section 3 of the Act at the appropriate stage. The context of the activities of the appellant has been shown on record by way of documents that the members have been assured of a constructed apartment and that the respondents have deposited moneys with the appellant from time to time as per the demands raised by the society. The contours of the activities and the conduct of the appellant do make them fall within the ambit of the definition of promoter as provided in Section 2 (zk) of the Act. Even though, we are not examining the felicity or correctness of their registration under the Societies Registration Act, but their amenability to the Real Estate (Regulation and Development) Act, 2016, cannot be doubted. Even the elaborated definition of the word ‘Person’ used to define the promoter, as given in Section 2(zg) categorically includes in its fold a cooperative society registered under any law relating to cooperative societies, as also an association of persons or body of individuals, whether incorporated or not, thus shutting the door to prevent unscrupulous persons from hiding under the garb of their registration under any other law relating to cooperative societies."
Therefore, the Authority under the RE (RD) Act has jurisdiction over real estate projects promoted by such a society. Thus Multistate Co-operative Societies Act, 2002 cannot put fetters on the jurisdiction of this Authority to decide disputes between homebuyers and the promoters/Respondent Society.
The Respondents collected monies for purchase of land for the housing project. The Membership Letter issued to the Complainant by the Respondents clearly mention about the project “CGHS Home” promoted by the society. The aim and objective of the Respondent Society, thus, was to raise housing project and the Complainant invested money and became member of the Society to purchase a flat in the said housing project and not for purchase of land only. The Respondents fall within the definition of “promoter” as defined in the RE (RD) Act, 2016. Therefore, the Authority has jurisdiction to adjudicate the matter and pass appropriate orders on the complaint. The Respondents cannot shirk away from the obligation cast upon them by RE (RD) Act, 2016.
It is pertinent to note that the statement of objects and reasons of RE (RD) Act, 2016 attempts to balance the interests of consumers and promoters by imposing certain responsibilities on both. It seeks to establish symmetry of information between the promoters and purchasers, enhance transparency of contractual conditions, set minimum standards of accountability and established a fast-track dispute resolution mechanism.
An allottee/home buyer can seek refund of amount invested with the 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 and compensation and also under section 12 of RE (RD) Act, 2016 if he/she was misled by any information furnished by the promoter with regard to the project either through advertisement or otherwise.
In the present complaint, the Complainant intends to withdraw from the said project on the ground of delay and are seeking refund of the amount paid to Respondent Society in respect of subject units under section 18(1) of the RE (RD) Act, 2016 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, which 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 Complainant but also misled her by concealing information that their society cannot undertake housing activity.
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 recent judgments of the Hon’ble Supreme Court that the Regulatory Authorities have 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., Civil Appeal Nos. 6745-6749 of 2019).
The Authority finds the Respondents' contention of refunding only Rs. 2,76,000/- to the complainant has no merit as the Respondents failed to disprove the receipts submitted by the complainant and which were issued by the Respondents only in favor of the complainant. Therefore, the Authority determines the full amount of Rs. 5,57,100 to be the correct sum due for refund to the Complainant.
In the light of the aforesaid, we are of the view that Complainant is entitled for refund of the amount proved to be deposited with the Respondent Society. Accordingly, we direct the Respondents i.e. ‘M/s Experia Boulevard Multistate CGHS Ltd.’ to refund the entire amount of Rs. 5,57,100/- (Rupees Five Lakh Fifty-Seven Thousand and One Hundred Only) to the Complainant i.e. Ms. Chandrakanta Rawat within 45 days of issuance of this order along with interest at the rate of 11.00% 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.