RERA Doesn't Give Homebuyers Right To Insist On Preferred Flat Or Block: Rajasthan REAT

The Rajasthan Real Estate Appellate Tribunal has held that the Real Estate (Regulation and Development) Act, 2016 does not confer any statutory right upon an allottee to insist on allotment of a preferred apartment, block or location. It held that such entitlement depends on the contractual terms agreed between the parties.

A Bench of Chairperson Justice Madan Gopal Vyas and Judicial Member Yudhishthir Sharma dismissed an appeal filed by Rail Vihar Phase-III homebuyer Rakesh Kumar Sharma against the Union of India and the Indian Railway Welfare Organization (IRWO).

Sharma had sought a refund after he was allotted a flat in Block A instead of his preferred park-facing Block C.

Noting that the parties' contractual relationship was governed by the IRWO General Rules, 2013, the tribunal observed that apartments are allotted through a computerized draw of lots. It held that no enforceable right accrues merely because an allottee expresses a preference.

Referring to Clauses 15.4 and 15.5 of the Rules, it observed:

"It is clear from the above text that no request for allotment of any specific dwelling unit or a floor shall be entertained and allotment of dwelling units shall be made by computerized draw of lots; meaning thereby, the particular unit in a particular block cannot be claimed by any allottee as a right. It is noted that the RERA Act, 2016 not mandated about any choice of Apartment or Unit. It will depend on agreed terms & conditions between the parties."

Sharma had applied for a Type-III dwelling unit in IRWO's Rail Vihar Phase-III project in Jaipur in March 2015. Although the project was initially planned with six residential blocks, IRWO later decided to construct only Blocks A and D due to technical reasons and poor booking response. Rajasthan RERA approved the curtailment in June 2023.

Sharma, who had paid ₹46.85 lakh and opted for a first-floor apartment in park-facing Block C, was allotted Flat No. A-602 in Block A through a computerized draw of lots. He refused possession and sought a refund, alleging that IRWO had misrepresented that the project would comprise six blocks.

The tribunal rejected the contention. It held that Sharma had applied only for a Type-III dwelling unit could not refuse posession merely because he was not allotted his preferred block. 

The tribunal also rejected the homebuyer's argument that IRWO's failure to execute an agreement for sale under Section 13 of the RERA Act automatically entitled him to a refund. According to it, although such non-compliance may have penal consequences, it give no right to recover the entire amount paid. 

Accordingly, the tribunal dismissed the appeal and affirmed Rajasthan RERA's order. It also clarified that Sharma remains free to withdraw from the project in accordance with the IRWO General Rules.

For Appellant (Rakesh Kumar Sharma): Advocate Unnati Vijay.

For Respondents (Union of India, Indian Railway Welfare Organization and Rajasthan Real Estate Regulatory Authority): Advocate Mitesh Rathore.