Rajasthan RERA Says Cancelled Allotment Requires Refund, Awards ₹1 Lakh Compensation To Homebuyers

The Rajasthan Real Estate Regulatory Authority (RERA) on 16 September awarded Rs. 1 lakh compensation to homebuyers in the “Surya Residency” project after promoter Ravi Surya Affordable Homes Pvt. Ltd. retained their Rs. 1.45 lakh booking amount despite cancelling the allotment.

Adjudicating Officer R.S. Kulhari passed the order on a compensation claim by Seema Devi and other homebuyers, directing the promoter to pay Rs. 1 lakh for retaining their booking amount after cancellation of the allotment. He held:

“In case the unit was cancelled, the promoter was supposed to refund the amount after deducting the administrative charges, if any, but no such communication has been made. The respondent has been utilizing the funds after cancellation of the unit. Simultaneously, the complainants were deprived of this amount.”

The homebuyers had booked Flat E-605 in the “Surya Residency” project on 19 July 2018 by paying Rs. 1.45 lakh. Ravi Surya issued an allotment letter on 24 July 2018, fixing the total sale consideration at Rs. 14.54 lakh.

They claimed that they intended to obtain a bank loan due to their financial condition and therefore asked Ravi Surya to execute an agreement for sale. According to them, no agreement was executed, the project was not completed and the booking amount was not refunded.

Ravi Surya contended that the agreement could not be executed because the homebuyers failed to execute it and pay the remaining sale consideration despite repeated demands. It eventually cancelled the provisional allotment on 25 July 2022.

The homebuyers initially approached RERA seeking a refund. On 25 September 2024, the Authority dismissed their complaint, holding that they had paid only 10% of the sale consideration and were therefore entitled to neither refund nor possession.

The homebuyers challenged the decision before the Rajasthan Real Estate Appellate Tribunal (REAT). On 28 October 2025, the REAT found contributory negligence on the part of both the promoter and the homebuyers, but directed Ravi Surya to refund the entire principal amount of Rs. 1.45 lakh without interest.

Thereafter, the homebuyers approached the Adjudicating Officer seeking compensation, contending that their money had remained with Ravi Surya since 2018, depriving them of both the flat and any return on the amount. They also sought compensation for physical and mental agony and litigation costs.

Ravi Surya opposed the claim, arguing that the homebuyers had paid only around 10% of the sale consideration and had failed to respond to demands for further payments. It contended that the homebuyers, being themselves at fault, were not entitled to compensation.

Rejecting the contention, the Adjudicating Officer held that the question of compensation had to be assessed independently. He noted that the entire Rs. 1.45 lakh had remained with Ravi Surya for about eight years and that the REAT's direction to refund the principal indicated that the cancellation and consequent forfeiture were not justified. He added:

“Therefore, the complainants are entitled to get return on the deposited amount in the form of compensation. If no compensation is granted, it would cause apparent tangible financial loss to the complainants and undue enrichment of the respondents.”

The Authority reasoned that if the promoter had borrowed the amount from the market, it would have had to pay interest. However, since the homebuyers had deposited only the booking amount, the case could not be equated with refund cases where a substantial portion of the sale consideration had been paid. It observed:

“If viewed from another angle, in case the promoter would borrow the amount from market he would have paid interest on that amount. However, the complainants have deposited only the booking amount, so this case cannot be equated with the cases of refund where a substantial amount of the sale consideration is deposited, yet the reasonable return on the deposited amount deserves to be awarded in the form of compensation towards financial loss.”

Accordingly, the RERA awarded Rs. 80,000 towards financial loss and Rs. 20,000 towards physical and mental agony and litigation costs, totalling Rs. 1 lakh. It directed Ravi Surya to pay the compensation within 45 days, failing which the amount would carry interest at 6% per annum from 16 September 2026 until payment.

Appearances for complainants (Seema Devi & Ors.): Advocate Pravesh Ramola.

Appearances for respondent (Ravi Surya Affordable Homes Pvt. Ltd.): Advocate Hardik Mishra.