Haryana RERA Directs Imperia Wishfield To Refund Amount For Delay In Handing Over Possession Of Shop

The Haryana Real Estate Regulatory Authority (Authority) on 12 February directed Imperia Wishfield to refund the amounts paid by the complainants, along with interest, after finding that the builder had failed to hand over possession of the commercial shops.

A Bench comprising Member Phool Singh Saini held that, as the project remained incomplete and the Authority had not issued the occupation certificate, the complainants could not be expected to wait indefinitely for possession. It observed:

“The occupation certificate of the building/tower in which the allotted unit is situated has not yet been obtained by the respondent. Accordingly, the respondent is liable to refund the amount received from the allottee in respect of the subject unit along with interest at the prescribed rate.”

The complainants booked commercial retail shops in the project “Elvedor Retail” located at Sector-37C, Gurugram, Haryana, developed by the builder, in 2013 and 2016.

The total consideration for the shops was approximately Rs. 37.34 lakh and Rs. 38.82 lakh respectively, and the complainants paid around Rs. 6.45 lakh. Despite receiving these payments, the builder neither executed a Builder-Buyer Agreement (BBA) nor delivered possession of the shops.

The complainants stated that, although they paid as demanded, the builder failed to start construction and later cancelled the project. They argued that the cancellation and non-delivery caused substantial financial loss, as they had invested their savings expecting to operate their business from the retail shops.

Aggrieved, they approached the Authority and sought a refund of the amounts paid with interest, compensation for mental agony and harassment, a penalty for failure to execute the BBA, and litigation costs.

The Authority found that the builder had not obtained the occupation certificate and had not taken any steps to complete the project. In these circumstances, it concluded that the complainants could not wait indefinitely for possession.

Relying on the Supreme Court's decision in Grace Realtech Pvt. Ltd. v. Abhishek Khanna & Ors., the Authority reiterated that builders cannot compel homebuyers to wait endlessly for possession. It also referred to Newtech Promoters and Developers Pvt. Ltd. v. State of U.P., which affirmed that an allottee's right to claim a refund under Section 18(1) of the Act is unconditional and absolute when the promoter fails to deliver possession within the stipulated time.

The Bench held that the builder violated Section 11(4)(a) of the Act by failing to hand over possession of the units and failing to demonstrate progress or completion of the project. Consequently, the complainants could withdraw from the project and claim a refund of the amounts paid.

While the complainants had sought a penalty for failure to execute the BBA, they did not press this claim during arguments, and no material substantiated it; therefore, the Authority did not make any finding on this relief.

Further, the Authority held that claims for compensation for mental agony, harassment, and litigation expenses fell within the jurisdiction of the Adjudicating Officer.

Accordingly, the Authority directed the builder to refund the entire amount paid by the complainants along with interest at the rate of 10.80% per annum, calculated from the date of each payment until the date of actual refund.