Maharashtra RERA instructs builders to give back interest paid to 15 home-buyers

The underconstruction project at Malwani, Malad

The Maharashtra Real Estate Regulatory Authority (MahaRERA) is surely and steadily showing its teeth. For the first time, 15 applicants have got relief in a case where they had booked flats in an under-construction project at Malwani, Malad, and the builder failed to meet the deadline. Interestingly, one of the complainants only had a letter of allotment (no agreement was signed), which was accepted by the adjudicating officer at MahaRERA, BD Kapadnis.

Interestingly, this is the first case wherein collective complaints were taken up as one, thereby saving the complainants from paying the mandatory RERA fee of R5,000 per complaint. Legal expenses, too, were low as instead of separate lawyers, one lawyer argued for all. This also saved the time of the adjudicating officer, said their lawyer Godfrey Pimenta.

The complaint
The complainants had booked flats in Gaurav Discovery, a project in Malwani, under the SRA scheme. Most of them had even entered into a proper sale agreement with the developer. While most of them claimed in their complaint that possession was to be given between June 2015 and December 2015, some agreements had no date of possession and in a few cases the date of possession was July 2017, Pimenta said.

Interestingly, while the complainants were keen on continuing with the deal, they wanted MahaRERA to intervene and impose interest on amount paid on the developer for not keeping his promise of handing over the possession within the stipulated period.

The argument
The agreements were executed as per the provisions of the Maharashtra Ownership Flats Act. Section 4 (1A) (a)(ii) which says that in every agreement prescribed by Section 4 (.1), particulars regarding date by which the possession of the flat is to be handed over to the purchaser has to be mentioned. This is the promoter's duty. When the promoter fails to specify the date of possession, he cannot take advantage of this and interpret the agreement in his favour. Hence, the dates of the allotment mentioned by the complainants were relied upon, even in cases where dates were blank.

Legal aspect
Section 18 of RERA provides that allottees can claim interest on their amount paid if the promoter fails to deliver possession of the apartments on the dates specified in the agreements. The rate prescribed is 2% above the Marginal Cost of funds based Lending rate (MCLR) of SBl; the current rate is 8.05%. Advocate Pimenta said, "This is a good order where a composite application has been entertained, despite them having different flats. Also, relief has been given to all flat purchasers of whom one had only an allotment letter."

Also read: Mumbai: MahaRERA fines builder Rs 12 lakh for advertising unregistered projects