Kerala RERA Awards ₹5 Lakh To Homebuyer After Apartment Lost 'Brand New' Status Due To Prior Use

The Kerala Real Estate Regulatory Authority has directed Sobha Limited and Puravankara Limited to pay ₹5 lakh in compensation to an NRI homebuyer.

It found that the developers had used his apartment for their official non-residential purposes before handing it over, causing it to lose its promised "brand new" status.

Adjudicating Officer K.S. Sarath Chandran partly allowed the complaint filed by Ernakulam resident, Tomy Abraham. The authority found that photographs placed on record clearly showed the apartment being used by the developers' staff and construction labourers before the occupancy certificate was obtained.

It awarded ₹3 lakh for the unauthorized use of the apartment, ₹2 lakh for mental agony, and ₹25,000 towards litigation costs. The authority also directed that the compensation would carry interest at 16.65% per annum from July 6, 2024 until recovery.

The authority observed, "From the photographs of Ext. A5 series it is clearly evident that the apartment allotted to the Complainant was used by the Respondents for the use of their staff or construction labourers. The torned carpets, Almirahs, tables, racks etc can be seen from the photographs. Electricity is also provided in that apartment and AiC and fan are aiso seen installed in that apartment before obtaining Occupancy Ceftificate, dated 3L.L2.2024 and it shows that the Respondents had used the apartment of the Complainant for their official unresidential use. Therefore, it is evident from Ext. A5 series and evidence of CW1 that the Respondents had utilized the apartment of the Complainant, allotted to the Complainant after Ext. A1 and A2 by their staff/labours and it lost his brand new status which amounts violation of A1 and A2 agreements"

Abraham entered into an agreement for sale and a construction agreement on May 24, 2018 to purchase a four-bedroom apartment bearing No. C17-S12064 in South Wing 12 of the Marine One project for ₹2.88 crore. Under the agreements, possession was to be handed over by June 30, 2022.

The occupancy certificate was issued on December 31, 2024. Possession of the apartment was handed over on October 29, 2025. The sale deed was executed two days later.

According to Abraham, he received an email from the developers on July 1, 2024. The email stated that the tower would be completed by September 2024 and called upon him to make the final payment. When he visited the apartment on July 6, 2024, he found several people inside the unit.

He also found a large conference table, office tables, and steel cupboards. Abraham alleged that construction workers were walking through the apartment in dirty safety shoes. The carpets were torn, and the kitchen and bathrooms were being used by the developers' staff and labourers.

He immediately emailed the developers along with photographs of the apartment. Later, he approached the authority seeking compensation for the unauthorized use of the apartment, alleging that it had lost its promised brand new status and caused him mental agony. He also sought rent at the rate of ₹1 lakh per month for twelve months.

Sobha and Puravankara denied using the apartment for commercial or other non-residential purposes. They maintained that tehy only stored construction materials in there and relied on the handover certificate signed by Abraham's authorised representative. The certificate essentially said that the place was inspected by him and was satisfactory.

The authority was not persuaded by that defence. It noted that the developers' witness admitted Abraham had visited the apartment in July 2024 and had taken photographs inside the unit.

It further held that the handover certificate, executed more than a year later, could not override Abraham's statutory right to seek compensation for the misuse of the apartment before possession.

While deciding compensation, the authority found that the evidence established the apartment had been used by the developers' staff and labourers before handover. However, it found no evidence to show that the misuse continued for one year, as alleged by Abraham.

It therefore rejected his separate claim for rent. The authority observed that awarding rent in addition to compensation for the same conduct would amount to double recovery.

The authority ultimately awarded ₹3 lakh towards compensation for the unauthorized use of the apartment and ₹2 lakh for the mental agony suffered by Abraham. It also awarded ₹25,000 in litigation costs.

The total compensation of ₹5 lakh will carry interest at 16.65% per annum from July 6, 2024, the date of the A5 series email and photographs, until recovery.

For Petitioner (Tomy Abraham): Advocates A K Muhammed Hashim, Shamjath Imran M P, Sherin Sheriyar (Wafa & Wafa Advocates).

For Respondent (Sobha Limited & Puravankara Limited): Advocates Abraham Mathew, Anil Abey Jose, Jeena Jose.