Mumbai: No respite for buyers despite RERA order

Bombay Realty's Island City Centre, project in Dadar

The New Year started on a great note for about eight to nine flat buyers who invested in Bombay Realty's Island City Centre project in Dadar. The reason - MahaRERA Appellate Tribunal overturned MahaRERA Chairman Gautam Chatterjee's order and passed a verbal directive on December 31 in favour of flat buyers. However, two months have gone by and the tribunal has not yet issued the written order, leaving the flat buyers in the lurch.

Advocate Ramesh Prabhu, who is also founder of Maharashtra Societies Welfare Association (MSWA), and had represented few flat buyers claimed, "As per the oral order on December 31, 2019, the Tribunal held that the allottees who booked the flats by paying 20 per cent are entitled to get entire amount refunded along with interest at the rate of 10.50 per cent from the date of payment till the entire amount is refunded. Further, the developer cannot sell the flat till the amount is refunded."

Prabhu added, "Justice delayed is justice denied" and the fact that the order though made verbally had to be issued within the stipulated time period, failing which it only creates further ambiguity in the minds of the common man. Moreover, as per the RERA Act, the complaints should be heard and decided within 60 days, but the Tribunal took almost a year for hearing and passing verbal order. And even after two months, they have not issued their written order, this derails the very purpose of formation of the Act"

Flat buyer Nainesh Sanghavi

'Still paying interest on loan'
Nainesh Sanghavi, a businessman who invested in the project said, "The developer made several promises at the time of construction but to our surprise, the project is far different from the assurances, and it is our right to step out of the project, now that we found that the layout plan changed, the date of possession was delayed and so is list of amenities that were promised. And all these changes are being done without informing us. Moreover, we are expected to stay with the project and pay for things, which we are not actually being given to us."

Sanghavi added, "I approached MahaRERA who had passed an order in my favour in 2018, directing the developer to refund. Soon, a bunch of other flat buyers too filed a complaint before MahaRERA, but this time the Chairman directed them to continue being in the project." When asked about the payment he had made to the developer, Sanghavi said, "I took financial assistance of approximate R2 crores, which was paid towards the flat cost of over R11 crores. I am still paying interest on the loan taken, and I had availed the loan for R11 crore."

"Even if the Appellate's order comes in my favour or even the other bunch of flat buyers, the developer will challenge the same before the Bombay High Court and then the Supreme Court, which means we will have to continue to keep fighting."

Should have issued in 30 days
Senior property lawyer Vinod Sampat said, "As per the provisions of Civil Procedure Code, any order should normally be issued in writing within a period of thirty days, from the date of pronouncing the order. Delay in issuing the order within the stipulated time, results in confusion amongst the parties." "In this case, the Appellant authorities have rightly set aside the order passed by MahaRERA. It appears that strong signals to MahaRERA authorities has been sent through this order that the merits of the complaint should be considered and the developers are restrained from taking the flat buyers for granted" Sampat concluded.

No comments
When contacted Bombay Realty, a spokesperson, refused to comment and said - "The matter is sub judice."

Jan 9, 2019
The day the MahaRERA chairman set aside the flat buyers' plea

The flashback

The complainants had booked apartments in the project in 2012-2013 via booking application letters. They later stated that the developer made false assurances regarding the amenities in the booking application and moreover has made changes to the carpet area and overall layout of the project. Therefore they asked the developer be directed to refund the entire amount paid along with interest and compensation as per the provisions of Section 12 of Real Estate (Regulation and Development) Act 2016. Stating its reasons, MahaRERA said in its order [mid-day has a copy], "Keeping in mind the larger interest of approximately 520 allottees of the project, allowing bulk withdrawal to so many complainants at this stage would mean jeopardising the completion of the project. Money for the refund will have to be taken out from a separate account, which is meant specifically for the completion of the project. This would eventually slow down the progress of the project work, especially when the project is nearing completion. Therefore, the provisions of Section 12 of the Act cannot be retrospectively applied to transactions that transpired before the Act came into force. Further, the complainants have failed to show that they have sustained any loss and damage by reason of an alleged incorrect, false statement made by the respondent and therefore, section 12 of the said Act is not applicable in the present case."

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