TN RERA Directs ₹5.94 Lakh Refund After Finding Common Area Encroachment In Casa Grande Bellissimo Project

The Tamil Nadu Real Estate Regulatory Authority (TN RERA), on 3 June, held that Casa Grand Civil Engineering Pvt. Ltd. cannot retain amounts linked to common areas where it uses such areas for additional parking without approval, and it directed the developer to refund Rs.5,94,832 to homebuyers in a Chennai residential project.

A Bench comprising Adv. M. Krishnamoorthy and Dr. D. Jaganathan, I.A.S. (Retd.), partly allowed the complaint filed by Nithya and R. Maghizharaman and ordered a refund of Rs.5,94,832 while rejecting the remaining reliefs. The Authority observed:

“Hence, the encroachment was not yet rectified by the Respondent. Due to additional car parking provided by the Respondent, there has been encroachment upon the common area for which the Complainants have paid certain amount towards the common area. Therefore, the Complainants are entitled for Rs.5,94,832/- towards the encroachment of common area, as per the calculation submitted by the Complainants which was not disputed by the Respondent.”

Nithya and R. Maghizharaman purchased Flat No. H-302 measuring 1,627 sq. ft. in the Casa Grande Bellissimo project in Chennai, developed by Casa Grand Civil Engineering. The Authority recorded that it allotted the flat on 18 May 2017. The parties executed a Deed of Guarantee on 13 June 2017, followed by a registered Construction Agreement and Sale Deed on 4 September 2020. The developer handed over possession on 6 February 2021.

The homebuyers approached TN RERA under Section 31 of the Real Estate (Regulation and Development) Act, 2016, seeking refund of Rs.5.94 lakh and alleging that the developer encroached upon common areas by creating excess parking spaces. They also sought refund of GST, parking charges, utility connection charges, and compensation for delayed possession.

They contended that the Greater Chennai Corporation's building approval dated 19 May 2017 and the CMDA planning permission dated May 11 2017 permitted only 345 parking spaces, while the developer provided 506 parking spaces by using portions of common areas. They alleged that this reduced the common area available to allottees despite collecting consideration for it.

Casa Grand Civil Engineering denied the allegations and stated that it did not encroach upon any common area. It further submitted that a revised parking arrangement had been proposed and placed before the competent authorities for approval.

TN RERA recorded that it had earlier rejected the claim for delay compensation in its order dated 27 April 2022. It held that the registered Construction Agreement dated 4 September 2020 fixed 31 December 2020 as the possession date and therefore no compensation for delay arose. It held:

“The Complainants having accepted the Construction Agreement which explicitly disclosed the details of completion of construction of the flat and handing over possession of the flat, are not entitled to claim compensation for delay in handing over possession of the flat", the Authority observed.

On the parking issue, TN RERA held that Casa Grand Civil Engineering failed to comply with its earlier direction requiring it to obtain allottee concurrence and CMDA approval for any revised parking plan by 30 October 2022. It noted that the developer did not place any material to demonstrate compliance.

The Authority further held that the developer did not produce any approval or document showing that it had rectified or regularised the alleged encroachment. It concluded that the common area dispute remained unresolved. It held that the homebuyers remained entitled to recover Rs.5,94,832 attributable to the affected area.

Accordingly, the TN RERA directed Casa Grand Civil Engineering to refund Rs.5,94,832. It rejected the remaining claims relating to GST, parking charges, utility connection charges, and delay compensation.

Appearances for complainants (Nithya and R. Maghizharaman): Represented by Chennai Law Associates.

Appearances for respondent (M/s Casa Grand Civil Engineering Pvt. Ltd.): Represented by Advocates Ganesh and Ganesh.