MahaRERA Orders Sahara Prime City To Refund ₹33.84 Lakh And ₹20.87 Lakh For Decade Delay In Handing Over Flats.

The Maharashtra Real Estate Regulatory Authority (MahaRERA) has recently held Sahara Prime City Ltd liable for a delay of over a decade in handing over possession of flats in its Nagpur project. The authority directed the developer to refund Rs 33.84 lakh and Rs 20.87 lakh paid by two homebuyers along with interest.

A bench comprising Mahesh Pathak observed: “In these circumstances, MahaRERA is of the prima facie view that the balance of convenience lies in favour of the homebuyers.Hence, the complainants are entitled to seek refund of the amounts paid along with applicable interest, irrespective of the fact that no specific date of possession is mentioned in the booking form executed by the complainant at Sr. No. 1."

The homebuyers (complainants) had booked flats in the project “Sahara City Homes Phase 1 Nagpur” developed by the builder.

In one case, the homebuyer's father had originally booked the flat in July 2007 for a total consideration of Rs 33.84 lakh, which was paid in full. After the death of both parents, the homebuyer became the sole legal heir and pursued the claim.

In the second case, the homebuyer booked a flat in August 2015 for a total consideration of Rs 20.87 lakh after a special category discount and also paid the entire amount.

The homebuyers stated that the builder had promised to hand over possession within the stipulated timeline. However, possession of the flats was not handed over even after several years from the dates of booking. They also alleged that no agreement for sale was executed despite full payment.

According to the homebuyers, the builder had issued letters in September 2016 acknowledging the delay and assuring reimbursement for losses caused due to the delay in possession. The builder, through letters issued in September 2016, acknowledged the delay and indicated that reimbursement would be provided for losses arising from the delayed possession. The communication also stated that compensation would be payable if the delay continued.

Even after these assurances, no agreement for sale was executed, and possession of the flats was not handed over.

Faced with the continued delay, the homebuyers moved the authority, seeking a refund of the amounts paid along with interest and compensation. Both complaints were subsequently clubbed together and heard by the authority.

The builder did not appear before the authority during the proceedings. The Authority noted that the builder failed to file any reply to the complaints despite repeated opportunities and therefore proceeded ex parte against it.

It also observed that the homebuyers had paid the entire consideration for their respective flats. However, the builder neither executed the agreement for sale nor handed over possession even after several years from the dates of booking. In one case the booking was made in 2007, and in the other in 2015.

The Authority held that under Section 18 of the Real Estate (Regulation and Development) Act, 2016, an allottee has the right to withdraw from the project and seek a refund with interest if the promoter fails to hand over possession within the agreed timeline.

In the present case, the builder failed to deliver possession and also failed to justify the delay. The Authority also noted that similar orders had been passed earlier in respect of the same project, granting relief to other allottees/homebuyers

Accordingly, the authority partly allowed the complaints and directed the builder to refund the entire amount paid by the homebuyers towards the flats along with interest at the rate of SBI's highest Marginal Cost of Lending Rate (MCLR) plus two percent from May 1, 2017, until realization. The refund amount along with interest has been directed to be paid within six months in six equal installments