Telangana RERA Initiates Penalty Proceedings Against Sivom Projects, MD For 44 Unregistered Plot Sales

The Telangana Real Estate Regulatory Authority (Telangana RERA) on 14 October ordered joint penalty proceedings against developer Sivom Projects Private Limited, its Managing Director, and a landowners' GPA holder for selling 40 residential plots in the 'Sivom Sahasra II' layout without prior registration under the RERA Act, 2016.

A Bench comprising Members Laxmi Narayana Jannu and K. Srinivasa Rao held that the project required registration before any marketing or sale activity. The Authority observed:

“Section 3(1) of the Act places the obligation to obtain prior registration squarely upon the "promoter" before any marketing or sale activity is undertaken. Section 4(1) of the Act further mandates that it is the promoter's obligation to make an application for registration. Registration under the Act is a statutory approval it is a sanction of the highest order under the real estate regulatory framework, required before any sale, marketing, or booking in the project can take place.”

The dispute concerns Sivom Sahasra II, a residential layout spanning approximately 18,755.25 square yards in Jeedimetla Village, Medchal-Malkajgiri District, Telangana.

Under a Memorandum of Understanding dated 22 November 2017, the landowners agreed to develop the property into residential plots. The Greater Hyderabad Municipal Corporation (GHMC) granted tentative layout approval on 17 December 2019 for 45 plots, including five plots mortgaged to GHMC.

Subsequently, Sivom Projects marketed the project and executed registered sale deeds for 40 plots during 2021 and 2022 without obtaining RERA registration. Essential infrastructure works remained incomplete.

Kambalipati Haribabu, representing members of the Sivom Social Welfare Association, approached Telangana RERA under Section 31 of the Act, seeking directions to complete the development works or allow the buyers to undertake them by selling the five mortgaged plots. The buyers alleged delays in completing roads, drainage and other amenities, as well as obstruction of access to their plots.

Landowners Penmatsa Bosu Raju, Penmatsa Venkataramana Raju and P. Rangaraju opposed the complaint, arguing that Sambamurthy lacked authority to sell their land. They maintained that the GPAs authorised him only to obtain statutory approvals and that disputes concerning ownership and partition were pending before competent courts.

The Authority found that the layout, comprising 45 plots across approximately 18,755.25 square yards, exceeded both exemption thresholds under Section 3(2)(a) of the Act, eight plots and 500 square metres, and therefore required registration before any marketing, booking or sale. It observed:

“The total number of plots in the layout, being 45, and the total extent of the land, being approximately 18,755.25 sq. yds, both manifestly exceed the thresholds of 8 plots and 500 square meters prescribed under Section 3(2)(a) of the Act for exemption from mandatory registration, and the project was therefore required to be mandatorily registered under Section 3(1) of the Act prior to any marketing, booking, or sale activity.”

The Bench further held Sambamurthy liable as a promoter in his individual capacity, apart from his role as Managing Director. It also held that Raju's authorisation to obtain statutory approvals extended to securing RERA registration. Holding the three respondents jointly liable for the violation, it said:

“Respondent No. 6, represented by Respondent No. 1, as the principal developer and promoter of the project, Respondent No. 1 in his individual capacity as a promoter under Section 2(zk)(v) of the Act, and Respondent No. 4, Sri V.S.N. Raju, as the duly authorised GPA holder of the landowners specifically empowered to procure all statutory approvals for the project, are held jointly liable for the said violation.”

The Authority declined to direct completion of the development works or permit the sale of the mortgaged plots because a Telangana High Court status quo order dated 12 March 2025 concerning the tentative layout approval remained in force. Proceedings before GHMC and a civil partition suit were also pending. It declined to grant police protection but allowed the buyers to approach RERA again after the pending proceedings concluded.

Accordingly, Telangana RERA directed its Secretary to initiate penalty proceedings under Section 59 against Sivom Projects, Sambamurthy and Raju, excluding the other three landowner-respondents from liability for non-registration.