Promoter Cannot Escape Post-Possession Obligations: Himachal Pradesh RERA

The Himachal Pradesh Real Estate Regulatory Authority has held that a promoter's obligations under Sections 11 and 14 of the Real Estate (Regulation and Development) Act, 2016 (the Act) are continuous and non-delegable, requiring strict compliance with sanctioned plans and provision of all essential services even after handing over possession.

The Authority comprising Chairperson R.D. Dhiman and Member Vidur Mehta allowed the complaint filed in relation to the “New Town Baddi” project and found that Gupta Property Developers Pvt. Ltd. had committed deficiency and violated statutory obligations. It held:

“The promoter is legally bound to ensure that the project is completed in all respects, with all essential infrastructure and services made available, before transferring responsibility to the association of allottees or any other entity. In view of the above, this Authority is of the considered opinion that the complainant has successfully established deficiency and non-compliance on the part of the promoter and is, therefore, entitled to appropriate reliefs.”

The dispute arose after allottees alleged that despite possession being handed over, the promoter failed to provide essential infrastructure, including proper electricity connections, sewerage systems, lifts, street lighting, fire safety systems, and maintenance services, forcing residents to manage and fund basic facilities on their own.

The promoter, represented by Vipul Mittal, contended that its role was limited and that maintenance issues were being handled by residents.

The complainant, Romit Barnyal, approached the Authority under Section 31 of the Act. He alleged that the promoter had failed to discharge core statutory duties, including provision of essential services, obtaining completion certificate, execution of conveyance deeds, and formation of a Residents' Welfare Association, and further alleged that the builder's representative stated that the promoter had “absconded” while still engaging in sale transactions.

Relying on inspection findings dated 29 November 2025, the Authority found that electricity was being supplied through a single 200 KW connection against the sanctioned requirement of 400 KW, resulting in inadequate supply and recurring financial liabilities on residents. It also recorded that residents had deposited approximately Rs. 16,00,000 towards enhancement of load and payment of arrears that were otherwise attributable to the promoter.

The Authority further noted that lifts, street lighting, sewerage systems, and fire safety infrastructure were either non-functional or poorly maintained. It observed that the project had significantly deteriorated due to absence of a functional association of allottees and long-term neglect of maintenance obligations.

It further held that only 32 registered sale deeds had been executed despite a substantially larger number of units being sold and handed over, reflecting failure to complete conveyance obligations.

The Authority also recorded that the promoter had remained absent from proceedings despite sufficient opportunities and failed to rebut the allegations, strengthening the complainant's case.

It held that continuation of project activities after expiry of registration on 03 November 2022 and failure to complete essential infrastructure amounted to violations of Sections 11 and 14 of the Act. It also noted that in related suo motu proceedings (Petition No. 26/2024), a penalty of Rs. 1,50,00,000 had already been imposed by the TCP Wing for continued non-compliance.

The Authority directed that if non-compliance continues, the Sub-Divisional Magistrate, Baddi, and the TCP/ATP, BBNDA, shall convene a General House Meeting of allottees on 05 June 2026 to facilitate formation and registration of an association under the Himachal Pradesh Societies Registration Act, 2006. It added:

“In the event of failure of the promoter to comply with the above directions, the Sub-Divisional Magistrate (SDM), Baddi and the TCP/ATP, BBNDA, Baddi, are hereby directed to convene a General House meeting of the allottees/association of allottees on 05.06.2026, and to take necessary steps for educating the allottees regarding their rights and responsibilities, facilitating constitution of the governing body of the association, and ensuring registration of the association under the applicable provisions of the Himachal Pradesh Societies Registration Act, 2006, in a time-bound manner.”

The Authority directed the promoter within two months to complete pending works, restore essential services, obtain completion certificate, execute conveyance deeds, and facilitate formation of a Residents' Welfare Association.

Accordingly, the RERA disposed of the complaint and directed that it be monitored in ongoing proceedings.

Appearances for petitioner (Romit Barnyal): Romit Barnyal, in person.