Adani M2K Homebuyers Can't Seek Additional Compensation After Accepting Delay Interest Award: Haryana RERA

The Haryana Real Estate Regulatory Authority (HRERA) has held that homebuyers in an Adani M2K project who chose to continue with the project after securing delayed possession compensation cannot seek separate compensation for the same delay.

Adjudicating Officer Rajender Kumar held, “The parliament did not intend to provide compensation other than DPC in case allottee does not intend to withdraw from the project.”

The ruling came while dismissing a complaint filed by two homebuyers against Adani M2K Projects LLP, the developer of the Oyster Grande residential project in Gurugram.

According to the complaint, the homebuyers applied for an apartment in the Oyster Grande project in October 2012 and paid a booking amount of ₹27 lakh. A Buyer's Agreement executed in September 2013 provided that the project would be completed within four years. The homebuyers stated that they had paid more than 95% of the agreed sale consideration for the apartment.

The buyers alleged that despite receiving substantial payments, the developer failed to complete the project within the promised timeline. They further contended that the developer raised additional demands and issued pre-cancellation notices even though the project was not ready and issues relating to registration of the project under RERA were pending.

The dispute was not the first round of litigation between the parties. The homebuyers had earlier approached the Authority seeking possession of their allotted unit.

By an order passed on April 20, 2023, the Authority directed Adani M2K to pay delayed possession compensation to the homebuyers and hand over the apartment after completing it in all respects in accordance with the Buyer's Agreement.

Despite having secured that relief, the homebuyers approached the Authority again, this time seeking ₹75,000 towards litigation expenses.

While considering the claim, the Authority examined Section 18(1) of the Real Estate (Regulation and Development) Act, 2016. It noted that where a promoter fails to complete a project or deliver possession as promised, an allottee who chooses to exit the project is entitled to seek a refund along with interest and compensation.

The position is different for homebuyers who decide to stay invested in the project. In such cases, the proviso to Section 18(1) limits the relief to interest for the period of delay until possession is handed over, the Authority held.

The Authority pointed out that the complainants had never sought to withdraw from the Oyster Grande project. Their earlier complaint was aimed at securing possession of the allotted apartment, and that proceeding had already resulted in an order directing payment of delayed possession compensation.

In reaching its conclusion, the Authority relied on the Uttar Pradesh Real Estate Appellate Tribunal's ruling in Greater Noida Industrial Development Authority v. Ranjan Misra. The appellate tribunal had held that compensation under Section 18(1) is available to allottees who choose to exit a project, while those who continue with it are entitled only to interest for the delay in handing over possession.

The Authority reproduced the appellate tribunal's observation that the legislature intended to provide compensation only to allottees who exit a project and not to those who continue in it.

Holding that the complainants had already been granted delayed possession compensation for the delay in delivery of possession, the Authority ruled that there was no justification for awarding separate compensation for the same cause of action.

The complaint was accordingly dismissed.